Stuart Greenfield, Sales Director at Advanced Supply Chain, looks at how the packaging Extended Producer Responsibility (pEPR) scheme has prompted a review of sustainability during pre-retail logistics.
Final base fees were recently confirmed for the first year of the pEPR, marking a significant milestone for a scheme which is estimated to raise billions of pounds in revenue from impacted businesses.
Packaging usage and waste are firmly in the spotlight, but have already been longstanding areas of innovation and improvement for many organisations, and certainly well before the pEPR.
However, the rollout of the new scheme has prompted a renewed focus on sustainability during pre-retail logistics – and this focus is stretching beyond packaging.
Pre-retail packaging inefficiencies
The latter stages of supply chains, where products are prepared for sale, have become a hotspot for the pEPR because of recent years of range expansion and diversification.
Retailers have had to compete with the growing popularity of online marketplaces. They’ve expanded and diversified their product ranges to give shoppers greater choice and better value, in an attempt to rival the likes of Amazon.
Retail business models have evolved, causing supply chains to swell, as goods are sourced from multiple suppliers and locations.
In addition to responding to competition from marketplaces and changing shopping habits, retailers have also grown supplier networks to spread risk and mitigate the impacts of possible supply chain disruption and delays. These factors have created numerous packaging inefficiencies.
High volumes of products are arriving at retailers’ warehouses and fulfilment centres from many different suppliers, in varying packaging and labelling formats.
Items have to be increasingly repackaged and relabelled to comply with a retailer’s stock inventory management system, as well as their branding.
This risks a lot of material waste, purely because of a lack of consistency and compliance throughout supply chains.
Pause for thought
In most cases, retailers have been moving at pace to expand and diversify product ranges, while also contending with global supply chain shocks and volatile trading conditions.
Attention and resources have, understandably, been required elsewhere, meaning a lack of bandwidth to properly interrogate the scale and complexity of packaging inefficiencies during pre-retail logistics.
pEPR provided pause for thought and has also led to retailers finding other opportunities to optimise processes and sustainability when preparing products for retail.
Eradicating wasteful repackaging and relabelling of products requires IT systems, operating processes and infrastructure, and resource models that ensure compliance with retailers’ standards.
An end-to-end process will be created that effectively ensures numerous different suppliers all provide goods in the same, retail-ready condition.
Packaging and labelling can be specified at source, so that they are consistent with what a retailer requires, rather than how a supplier typically works.
The creation of retail-ready solutions has improved packaging sustainability and saved retailers time and resources involved in repacking and relabelling.
New solutions have also created a flow of data that’s enhanced end-to-end visibility of stock inventory, presenting an opportunity to further understand the wider pre-retail impacts of working with a larger number of suppliers. In particular, retailers have been able to review and better coordinate their fleet.
With the right IT capabilities and transport management systems, it’s possible to consolidate both inbound and outbound vehicle movements during pre-retail.
Transportation load capacity is being optimised to avoid part-loaded HGVs arriving at and departing from retailers’ warehouses and fulfilment centres. There’s less movement of empty vehicle space, meaning supply chain mileage and the number of vehicles on roads can be reduced to help lower emissions.
Improved fleet scheduling can also avoid HGVs queuing and idling at warehouses to further reduce emissions.
The pEPR has seen retailers concentrate on packaging efficiencies during pre-retail logistics, which is supporting wider supply chain sustainability. Improving packaging compliance and consistency also eliminates errors that can cause deliveries to be rejected.
Getting supplier orders right the first time avoids redeliveries and any associated emissions. Pre-retail has become a strategic focus for optimising both packaging and processes that minimise waste and environmental impact.
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