Cardboard Packaging Industry: Channel Innovation
Smurfit Kappa is a global leader in the production and supply of corrugated cardboard packaging, cardboard containers, and liquid containers. The company is the market leader in Europe in its field and has operations in 35 countries. It has won numerous innovation awards for its packaging solutions and some of its customized solutions have helped clients increase revenue and profits. In 2016, the company designed an innovative packaging to transport strawberries for a Polish client which resulted in a 50% profit increase.
- In 2016, a Polish company called SoFruPak approached Smurfit Kappa with a fruit packaging issue.
- Initially, wood veneer punnets were used by SoFruPak to transport strawberries. However, fruits stored in this type of container were damaged by mildew and fungi, resulting in sales losses.
Faced with this issue and using its experience and know-how, Smurfit Kappa designed and created a new packaging solution that allowed strawberries to rapidly cool and avoid fruit loss.
- The new packaging developed by Smurfit Kappa featured numerous air holes in the single strawberry packs and a bottomless crate.
- As a result of adopting the new packaging solution, the Polish strawberry producer managed to increase profits by 50%.
- Two videos were published on YouTube to explain the offering.
- The first video is 16 seconds long and the second one is 58 seconds long.
Google Slide Presentation
- All the main insights have been added to the shared slide presentation.
- The company logo has also been added to the presentation.
- Videos 1 and 2 have been embedded in the presentation.
Cardboard Packaging Industry: Service Innovation
Smurfit Kappa is an environmentally-ethical cardboard packaging company that has succeeded in innovating several product designs and services through its sustainability-focused strategies. More information about this company is provided in the attached Google slides.
- Smurfit Kappa is a company that focuses on manufacturing paper-based packaging. Other than providing a wide range of papers and packaging designs, this company also offers recycling solutions for its clients.
- The global headquarters of this company is located in Dublin, with regional headquarters in Amsterdam and Miami. Smurfit Kappa employs approximately 46,000 workers in 350 production sites in 35 countries across Europe and the Americas, including Ireland, Chile, Germany, Greece, Spain, and Portugal.
- Smurfit Kappa owns about 67,000 hectares of forest around the world to ensure sustainable development principles, promote economic growth, use natural resources responsibly, and foster social equity.
- This company is aware of the mega-trend of sustainable packaging. For instance, approximately 75% of customers prefer paper-based packaging compared to plastic. Hence, it aims to focus more on recyclable packaging options.
- Smurfit Kappa has committed to make measurable progress against its five strategic sustainability priorities of the forest, climate change, water, waste, and people. To achieve its goal, this company is guided by four core principles of materials, production, supply chain, and end of life.
Smurfit Kappa's Service Innovation
- In 2018, Smurfit Kappa created the 'Better Planet Packaging' campaign to raise awareness about sustainable packaging.
- Smurfit Kappa held an Innovation Event in 2019 with the theme ‘Better Planet Packaging’ to educate 350 customers about the distressing impact of waste on the environment.
- On its website, this company also educates its customers about the importance of sustainability for the environment and sustainability tips.
- According to a study, approximately 60% to 80% of consumers will not repurchase a product with poor packaging. On the other hand, about 72% of US shoppers will buy a product based on the packaging alone.
- Smurfit Kappa has 25 Experience Centers around the world. This place allows a visitor to explore the importance of paper and packaging can improve the marketability of his/her product, learn about customer behavior from leading behavioral insights, observe supply chain trends, discover about Smurfit Kappa's advanced paper and packaging design tools, and get inspired from the packaging exhibition. A visitor may also view the digital prototype of his/her selected packaging design in a fully simulated store environment.
RESEARCH AND DEVELOPMENT
- To create products that offer better performance and improved utility, Smurfit Kappa is keen to do research and development based on experience, data, and creativity. It also collaborates with various universities and organizations to develop fit-for-purpose, cost-effective, and sustainable packaging solutions. Smurfit Kappa's R&D focus areas are paper & board mechanics, quality, process control, supply chain technology, print expertise, consumer research, and food safety.
- The examples of Smurfit Kappa's innovative products that match the trends and public's needs are Cardboard Castle, Not A Drop Wasted, and Packed Like Sardines.
- In 2020, every business in the UK must recycle 75% of its paper and cardboard waste. This new regulation may be troublesome for some companies.
- Smurfit Kappa offers a recycling service where it purchases cardboard and paper waste from public and private sectors to be recycled. It accepts various types of waste, including gray board, supermarket corrugated paper, magazine, newspaper, and printed white paper. This company recycles about 15,000 tonnes of paper waste annually and plans to increase to 25,000 tonnes by 2020.
- Due to its sustainable packaging strategy, Smurfit Kappa saw an increase in its revenue by 3% to €6.85 billion in 2019.
Smurfit Kappa's Packaging Innovations
- Many parents feel guilty about purchasing unsustainable toys that cannot be recycled after they're broken.
- Cardboard Castle, an award-winning innovation that Smurfit Kappa created, is an attractive toy box that can be turned into a castle for children to play in. Since the product is made of cardboard, it is 100% recyclable, renewable, and biodegradable.
- Additionally, Smurfit Kappa also launched eco-friendly toys under the brand of ekolife.
NOT A DROP WASTED
- 'Not A Drop Wasted' is a life-saving dialysis kit that won the 2019 WorldStar Awards for innovative and sustainable packaging solutions.
- This packaging contains two 5-liter dialysis bags of solution securely with safe rounded corners. This product can be opened easily without a knife.
PACKED LIKE SARDINES
- 'Packed Like Sardines' is an environmentally friendly, space and cost-saving packaging product that is designed as a tray that can hide an easy-assembling insert in its bottom.
- This packaging design also won the 2019 WorldStar Awards for innovative and sustainable packaging solutions.
- This product is designed to eliminate the use of plastic.
Cardboard Packaging Industry: Product Performance Innovation
Northbox is a pioneer innovator in cardboard manufacturing. It produces cardboard boxes with insulation that ensures products remain refrigerated for up to 48 hours. Northbox is suitable for the delivery of ready to eat and ready to cook products, which it is the market leader in Canada. We attached here a video presentation of the innovation in addition to presenting the findings in a Google Slide here.
- The rapid growth of the meal kit market faced expensive cost premiums from use of refrigerated trucks. The meal kit industry faced logistical challenges and cost implications that negatively affected their profitability and customer satisfaction.
- Importantly, the companies faced poor customer experience from receiving ready-to-cook products that were not at the right temperatures. As such, meal kits often led to customers getting sick that attracted regulators and public safety concerns.
How it works
In order to determine a case study example of a product performance innovation of a cardboard packaging company that has successfully innovated by improving its products' performance, features, and quality, your research team reviewed news and industry sources such as Packaging Connections and Candy USA. We restricted our research to cardboard packaging innovation that had taken place over the last five years. Importantly, we presented information on how the innovation is an improvement of product performance, features, and quality. Your research team attached a video depicting the innovation as well as presenting findings in the attached Google Slide show.
Cardboard Packaging Industry: Process Innovation
WestRock is an example of a company in the cardboard packaging industry that has successfully innovated by optimizing the operations that produce its primary offerings. To address the labor-intensive production of customized packaging, WestRock utilized digital tools to allow its new generation of machines to switch packaging capabilities in under an hour. Detailed below is an overview of the company as well as how it successfully optimized its processes. The same findings have also been entered in the Google Slide attached.
- WestRock is a market leader in the paper and packaging industry that caters to the packaging and paper needs of a wide range of sectors, including beverage, food, media & electronics, healthcare, retail, and luxury among others. It is the second largest paper and packaging company in the US and among the top five in the world.
- WestRock was born in 2015 when leading packaging companies MeadWestvaco and RockTenn merged, creating a $16 billion cardboard carton manufacturer.
- The company is headquartered in Atlanta, Georgia, and has 26 other offices located all over the world.
- In 2018, the company generated a revenue of $16.29 billion.
The Process Innovation
- Producing packaging of different sizes and diameter was a laborious and inefficient process. For example, producing packaging for a four-pack energy drink required a different system as producing packaging for a double stack of 12-ounce cans. Customization for different packaging needs was expensive and hard to scale.
- The company believes that brands should have the power to change without compromising their production time and processes.
To address the customization challenges in packaging, WestRock integrated new digital tools that allow its new generation of machines to switch packaging capabilities in under an hour.
- The company's automated beverage multipack systems "enables brands to achieve mass customization at speed and scale to differentiate their products to their consumers."
- WestRock worked with Bosch and Dassault Systems for the hardware and software, respectively, to come up with the machines that help their customers win consumers through their packaging. The machines were designed using "aerospace-quality 3D software" and "cutting-edge sensors and servomotors."
- The company's new generation of machines can automatically transition between 24 configurations of packaging and container sizes.
- WestRock's latest automation innovations are Meta Duo, a shelf- and retail-ready packaging automation; Pak on Demand Pouch System; and BoxSizer, an intelligent right-sizing box technology.
Interesting or Little Known Facts
Cardboard Packaging Industry: Network Innovation
Kite Packaging Ltd is a packaging company in the UK that has collaborated with five other companies to innovate on a new way to make cardboard packaging that takes less space and weighs less but does not compromise on strength. A Google Slides presentation of the insights provided below and some video examples from Kite Packaging Ltd has also been attached to this request.
Overview of Kite Packaging Ltd
- Kite Packaging Ltd is a premier packaging company in the UK that believes in employee-ownership.
- Kite offers solutions for consumers from various industries in need of packaging. For example, they offer corrugated cardboard packaging solutions for consumers that need to ship according to certain specifications.
- With 7 sites operating around the country, Kite has become one of the largest distributors of packaging in the UK. They have integrated all 7 of their sites into their national and international supply chain to ensure fast delivery time all the time.
- Kite believes that customer satisfaction becomes more important to a person that owns the business so the company was established as an employee-owned business from the moment it was founded in 2001 so that employees also enjoy the benefits stemming from great customer service.
How Kite Packaging Ltd Innovated
- Kite Packaging Ltd wanted to improve the logistical efficiencies of their warehouses by cutting down on the amount of space taken up by corrugated cardboard cartons. They believed that by doing so, the company would be able to save money and reduce household waste stream.
- Kite Packaging Ltd, in collaboration with other companies and programs such as the Waste & Resources Action programme (WRAP), the Packaging Industry Research Association (PIRA), Svenska Cellulosa Aktiebolage (SCA), Toys R Us and ARUP, took on the task of using single wall flute cartons for their new packaging products instead of the usual double wall flute cartons.
- Kite Packaging Ltd enlisted the help of PIRA and SCA for the compression testing of the new cardboard packaging to ensure that the strength of the new packaging was not compromised by using single wall flute cartons. As a result of these tests, two grades of single wall flute boards were chosen which weighed less but had similar strength when compared to the old double wall flute cartons.
- To test the new packaging's strength, Kite Packaging Ltd partnered with Toys R Us for a trial run of this innovation. The results of this test was consistent with the results of the compression tests, allowing for the continuation of the project.
- Kite Packaging Ltd commissioned ARUP to investigate the environmental implications of their new cardboard packaging product.
How The Innovation Works:
- The idea of the innovation was to switch to the use of the thinner single wall flute cartons while maintaining the strength of the old ones. Customer feedback on the strength of the new cardboard packaging revealed that this was achieved with 55% of survey respondents saying that the strength of the new cardboard packaging has not changed from the old one and 45% saying that it has gotten better.
- The report of ARUP concludes that using the thinner single wall flute cartons could result in a 30% carbon dioxide saving because it would take fewer trips to transport the same amount of boxes "from manufacturer to distributor to end-user".
- Kite projects that the use of this thinner cardboard packaging could save the company as much as 36 tons of paper-based packaging material per year, which in turn reduces the amount of corrugated cardboard entering the household waste stream by about 25 tons.
- The overall customer feedback on the new cardboard packaging was very positive.
Cardboard Packaging Industry: Customer Engagement
Using intelligent cardboard engineering technique and innovative trays, TRAKRAP reduced cardboard usage in its packaging solutions by 40%, while providing packaging that is 100% recyclable for retailers. This Google Doc and the brief below provide further details of our findings.
WHAT TRAKRAP DOES
- TRAKRAP designs and manufactures sustainable packaging solutions for its clients in the Fast Moving Consumer Goods (FMCG) space. The company strives to provide packaging solutions that are sustainable and have a lower impact on the environment.
- The company is located in Skelmersdale, Lancashire.
- TRAKRAP aims to "minimize external packaging and provide a clean and simple solution to the preparation of the main pack direct to the shelf."
- The company reduces the time for shelf replenishment by producing packs that are quicker to prepare for the shelf, break down, and discard. They also reduce supply chain costs, using inbound packs that are quicker to fill.
- For example, TRAKRAP, in collaboration with Encase, improved customer engagement using a "two-piece, die-cut pack, wrapped in a low CO2, fully recyclable film. This film was used to provide strength and transparency to the pack."
- The company also provides the latest change management programs for its customers, led by its team of experts to ensure fast, seamless, and successful adoption of most recent technological changes in packaging and machines.
HOW IT WORKS
- TRAKRAP wraps products using 100% unique, recyclable polymer film. It also uses the film to hold the pack together. This procedure thus eliminates the need for heat tunnels and reduces energy consumption by 90% when compared with traditional shrink wrapping.
- As such, the TRAKRAP system is more suitable for "ambient, chilled, frozen, or volatile products." The company, in collaboration with ReelVision, developed innovative trays that work with the film and reduces cardboard usage by 40% through intelligent cardboard engineering, resulting in a lighter weight, as well as retail-ready packaging (RRP) that is 100% recyclable for retailers.
- Using its TRAKRAP System that includes the unique TRAKRAP machine, pack design, film development, and knowledgeable staff, the company has sped up the rate of eco-innovation adoption in the market, reduced carbon footprints greatly, while increasing productivity, flexibility, and safety in its packaging solutions for FMCG manufacturers.
- Their solution canceled out problems such as frayed tears and damage due to mishandling.
TRAKRAP packaging solutions are considered to be ideal for the FMCG market.
- The company's new, innovative packaging system earned it three award nominations for the UK Packaging Awards, namely "Corporate Social Responsibility Initiative of the Year; Resource Efficient Pack of the Year, and Retail Ready Pack of the Year."
- "The TrakRap Packaging System won the Innovation Award at the Food and Drink Federation (FDF) Awards 2018."
Cardboard Packaging Industry: Product System Innovation
The case study of Hans Boodt packaging is an example of how the cardboard packaging company Swedbrand Group, demonstrated innovation by creating a new way to package individual products and bundled them together in a scalable system. The details of this case study were included in the attached presentation and below.
- The company's goal is to create sustainable packaging solutions of high quality, provide an excellent service, and being competitive through their innovation, creativity, quality, knowledge, and support.
- They believe that production and design must work together to deliver high-quality, reason why they provide packaging design services to their clients and work together to innovate their packaging solutions and customize the packaging to their cost, design, or efficiency needs.
- Swedbrand Group has locations in Shanghai, London, Stockholm, Hong Kong, Ho Chi Minh City, and Tallinn.
- Background facts:
The company was founded in 2006 in Hong Kong by two Swedish nationals.
Swedbrand Group has manufacturing partners in different regions of Asia and Europe, clients in 17 countries, and support in ten languages.
- The company has case studies of packaging innovation works they've done for high-profile companies of different industries, like Doddle, LH Cosmetics, Dr. Temt, Plantagen, SmartThings, Porsche, Axfood, Santa Rita, The Chocolate Line, Swarovski, Maelu, Doro, Hans Boodt, SCA, Auchan, Live It, Gondo Gifts, Dolores Promesas, Beech's, Yoomi, and Apple, among others.
Hans Boodt Case Study
- Through this design, the company wanted to provide a cardboard package that was easy to carry, open, assemble, understand, and dispose of, which felt like a gift.
- They created a cardboard package that contained all the different pieces of a mannequin in small boxes bundled together in the main box, which served as assembly instructions.
- The challenges Hans Boodt presented to Swedbrand Group included creating a package able to hold all the mannequin parts to make it easy to carry, that created a positive impression aligned with the brand's image of elegance and high-quality, that could be opened easily, and helped the user understand how to assembly it faster.
- Swedbrand Group created a full experience through their packaging, creating a sense of exclusivity, and simpleness from elements like adding a scent, and boxes that were numbered and ordered based on assembly steps to guide the user through the process.
- Additional to the cardboard packaging, they used foam layer for the fragile items to make it easier for the customer to lift them, and reusable padded bags for sustainability.
- They conducted client tests and group research to perfect the packaging and finally created a high-quality package comprised of five instructional packages in the interior.
- The result was a positive impression by Hans Boodt and its customers.
Cardboard Packaging Industry: Brand Innovation
Smurfit Kappa is a company in the cardboard packaging industry that has successfully innovated by identifying new ways of improving product recognition and branding. It launched the Better Planet Packaging initiative in 2018 to promote its sustainable packaging credentials. The research insights were presented in the attached Google Slide that also includes a video on the branding campaign.
- Consumers are less aware of the recycling credentials of corrugated cardboard packaging. Additionally, customers are confusing corrugated cardboard packaging recycling as being less sustainable than packaging that can be reused.
- Consistent campaigns of the recycling and sustainability attributes of corrugated cardboard have increased its prominence in the public eye. Already, about 73% of shoppers prefer paper-based packaging over plastic. About 86% of shoppers prefer buffering that is easily disposable and recyclable.
THE BETTER PLANET INITIATIVE
- A critical part of the initiative was Smurfit Kappa's engagement with consumers, sustainability experts, innovators, and corporate partners to promote recyclable packaging.
- Smurfit Kappa partnered with innovators by launching two design challenges. In the first challenge, whose focus was on isolation for temperature control, the winning team used expanded polystyrene to make insulation products from paper pulp. The second challenge winner came up with a net-like paper structure for securing pallet loads.
- Smurfit Kappa partnered with corporate companies to promote the initiative and included their case studies to promote the importance of using recycled cardboard packaging. It has presented ten case studies, covering topics such as the use of cardboard packaging for utilization in shopping baskets, pizza discs, and grooming products, among other applications.
In order to identify a company in the cardboard packaging industry that has successfully innovated by identifying new ways of improving product recognition and branding, we engaged in extensive research across news sources such as Copy Book and Packaging Europe. Importantly, your research team restricted the research to identify innovations created in the last five years. Additionally, we presented information on the problems guiding the innovation, the innovation and its impact as well as background facts about the company. We presented the insights in the attached Google Slide that also include a video on the branding campaign.
Cardboard Packaging Industry: Structure Innovation
Amcor is an example of a cardboard packaging company that was able to innovate and increase its profit by identifying new ways of structuring itself, reorganizing its talents, and assets. The details of the analysis were included both below and in the attached presentation.
- Amcor is one of the global leaders in sustainable packaging, producing packaging for food, home and personal care, beverages, medical, pharmaceutical, etc. They work with specialty cartons and cardboard, flexible packaging, plastic bottles, jars, capsules, and closures, among others.
- The company has its head office in Zurich, Switzerland; additionally, the company has 250 office locations in more than 40 countries around the world, including 164 locations in America, 59 in Asia-Pacific, and 97 in EMEA.
- Background Facts: Amcor is a public company that generates US$13 billion in annual sales and has more than 50,000 employees around the world.
- It has been in the packaging market for over 160 years, founded in 1860 in Australia as APM, and then rebranded to Amcor Limited. Its knowledge and expertise have made it a global leader, and its drive to innovate constantly has kept them relevant in the market.
Case Study: Amcor's Restructuring Plan
- The company focused on the value offered to its clients and employees and is currently working on expanding to other markets, adding new technologies, and improving its industry structure.
- Amcor created a strategy to reduce operating costs, raw-material costs, and provide more benefits through a restructuring initiative.
- Amcor wanted to increase profitability and market share in a competitive industry, be more attractive to its shareholders, and serve the customers better by offering a scalable business with better global reach.
- Raw-material prices had increased since 2017, and the requests for beverage packaging had decreased in North America and other emerging countries.
- According to the company's chief executive, Ron Delia, the strategic restructuring plan would involve operational restructuring and strategic geographic investments and acquisitions.
- As planned, Amcor acquired different companies in the US, Brazil, South Africa, India, and China, and closed 14 plants in Europe and other developed markets for its operational restructure and to reduce overheads.
- The packaging companies Alusa, Hebei Qite Packing, and Bemis were some of the companies acquired in Chile, Brazil, and China.
- To support the operational restructuring in different regions, Amcor sought support from companies like Expert360 in Australia and Regional Growth Partnership in the US.
- This restructuring process also included changes in the board of directors of the company and listing the company on the
New York Stock Exchange.
- Thanks to the restructuring plan, the company doubled its global annual profit in 2018, jumping from USD$244.1 million to USD$597 million in one year, Amcor's market share grew 3% in the US, and its dividends and shares also presented growth.
From Part 01
- "Smurfit Kappa has won three awards for innovative and sustainable packaging solutions at the 2019 WorldStar Awards.
The first product was for a life-saving dialysis kit. ‘Not a Drop Wasted’ is a secure but easily opened pack with rounded corners to protect the 5-litre bags of dialysis solution inside."
From Part 04
- "We are a $19 billion paper and packaging company with leading positions in growing markets around the world."
- "We are 50,000 team members who are passionate about packaging."