Gaining a Seat at the Table

Incorporating Environmental Considerations into the Packaging Development Process

J. EdwardsAssociate Principal Engineer

Kraft Foods Global, Inc.

The Challenge

Influence Packaging R&D culture such that:

Environmental design considerations are routine

Pursuit of sustainability enables / accelerates innovation

The Obstacles

Stiff competition for developers’ attention & time:

Aggressive project timelines

Focus on immediately tangible benefits

Need for actionable environmental design direction

The Opportunity

Establish sustainability as the new context for packaging innovation:

Provide industry design guidance

Collaborate with customers & consumers to address challenges w/ sustainable methods

Communicate successes, often

Environmental Packaging Design Guidance Drivers

► Pkg. Management- Adhere to corporate

environmental policy- Promote best practices

► Customer- Minimize environmental

impact across packaging supply chain

► Consumers- Deliver on expectation of

‘environmentally friendly’ packaging

Eco-Toolbox Implementation

- Poses key design questions- Provides resources to

address

Eco-Toolbox Overview

• Provide environmental data for common packaging materials facilitate informed comparisons amongst options

• Quantifies a packaging system’s environmental impact

• Provides guidance, by material type, to maximize package compatibility w/ current recycling infrastructure

• Documents a design’s adherence to policy via 4 key design questions

Material Fact Sheets

Eco-Tool Calculator

Design for Recyclability

Packaging Environmental

Compliance Checklist

Material Fact Sheets

Eco-Toolbox Calculator

Technical Background

o Excel spreadsheet is a condensed excerpt from a software tool called Eco-It, w/ focus on packaging-relevant information only

o Eco-It is a condensation of many European LCA studies - this LCA data is well accepted as European Industry Average

o Data updates pending in 2H ‘07o North America: via U.S. Life Cycle Inventory Databaseo EU: via Eco-It

Eco-Toolbox CalculatorMaterials Used Weight in Grams

Aluminum foil 1.9

Aluminum (low recycled content) 0

Aluminum (high recycled content) 0

Steel (low recycled content) 0

Steel (high recycled content) 0

HDPE 0

LDPE 0.1

LLDPE 0

Nylon 66 0

PET (bottle grade) 0

Polycarbonate 0

Polypropylene 0

Polystyrene (HIPS) 5.3

PVC 0

Recycled mixed plastic 0

EPS 0

Glass (clear) 0

Glass (colored) 0

Paper/board (virgin) 12.3

Paper/board (recycled) 0

Corrugated board (recycled) 8.3

Wood (pallet) 4.6

Eco-Points Score:

50

Energy Used in Manufacture & Use Quantity in MJ

Heat from Hard Coal 516

Heat from Oil 0

Heat from natural gas 1485

Electricity (grid) 1278

Electricity (credit) 0

Eco-Tool: Packaging Energy Content

0.00

1000.00

2000.00

3000.00

4000.00

5000.00

6000.00

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Packaging Environmental Compliance Checklist

► Is the package minimal?• Is every component critical? Has work been done to minimize the amount of material in each component?• Resource: Material Fact Sheet #2 (Minimization); Measure: Eco-Tool Calculator Packaging Environmental

Index

► Is the package recoverable?• To what degree is the package designed to facilitate end-of-life options besides landfill?• Resources: Material Fact Sheets (Waste Management Sections); Design-for-Recyclability Guidance

► Does the package contain retailer-banned materials? Is the package free of hazardous substances?

- PVC (Material Fact Sheet #6) - Fluoro polymers - Heavy Metals

► Is the use of materials made from sustainable sources an option?

- Paperboard - Bio-based resins - Recycled content

The PECC is the key deliverable in the Toolbox and needs to be completed as part of the development process

• Resource: Material Fact Sheet #1 (Overall PECC guidance)

Eco-Toolbox Roll-Out, Learnings

Extension of guidance to Global Packaging R&D completed in November ’06

Roll-Out learnings (North America):Be flexible evolve the communicationBe responsive host follow-up training for

small groups as necessaryBe relevant update Toolbox with new &

supplemental guidance

Eco-Toolbox: Supplemental Guidance

Design-for-Recyclability (Sept. ’06) Consolidation of paperboard, plastic, glass, aluminum

and steel packaging industry guidance

Sustainable Packaging Coalition Design Guidelines (Jan. ’07) Kraft Foods has been a SPC member since 2005

Overall Approach re: Benefits – ‘Think Negative’

Seek first a business problem that can be solved via a packaging change

Solve the problem w/ sustainable means or methods

“If you want to do something wonderful, start with a problem”

- Anonymous

Articulating Environmental Design Benefits

At least three ‘audiences’ exist…

1. Internal business teams Goal: Resource the project

2. Customers Goal: Support the commercialization

3. Consumers Goal: Inspire purchase

Articulating the Benefits: Internal Business Teams

“Why should we work on this?”

To what degree does the design in question offer one or more of the following?

Material reduction cost savings• Either via lightweigting or material substitution

Conversion energy savings• Either @ packaging supplier and/or @ product filling

Improved efficiency through common / improved design• Freight savings (i.e. more product per pallet, product per truck)

Articulating the Benefits: Customers

“Why should we support this change?”

Best to collaborate with customer buyers as appropriate to seek out relevant supply chain benefits:

Improved efficiency through common / improved design• Freight savings (i.e. more product per pallet, product per truck)• Easier handling improved operations (foodservice)

Reduction of in-store / facility waste

Alignment with corporate sustainability goals• Wal*Mart, etc.

Articulating the Benefits: Consumers

“Why should I buy this?”

Need to closely engage material supplier and Marketing to determine the following:

Range of benefits enabled by the subject material / technology• Supplier to share all verbiage that can be applied and substantiated

Fertile ground for effective environmental claims• Marketing must distill business insight and summarize relevant customer areas of

interest• To what degree do these areas overlap with the ‘technical’ verbiage from the

material supplier?

Ensure that ‘short list’ of claims can all be verified• FTC Part 260: Guides for the Use of Environmental Marketing Claims • ISO-14021: Environmental Labels and Declarations• Engage Legal as necessary

Communicate Successes

Such communications do the following:

Motivate… Project teams to pursue new sustainable solutions

Inform… The organization as to which solutions work and which alternate

approaches might hold promise

Demonstrate alignment… With both individual company and customer environmental policy

Case Study #1: Crystal Light & Fruit2O Bottle Lightweighting

Key enabler: optimized, common design

Inventory flexibility, sourcing efficiencies

PET resin reduction: 18%; 8.7MM lb. annually

84% of reduction occurred in 2006, w/ balance taking effect in 2007

Case Study #2: Mac ‘n Cheese Pallet Overhang Elimination New shipper facilitates

automated warehousing*

849M lb. annual material reduction

1,950 more cartons / truck Decr. transportation emissions

Display-ready design*

*New design not pictured – project still in process