Materials handling: Reusable Packaging Association launches economic calculator
Reusable packaging increases productivity and helps reduce costs; economic calculator tool will help businesses determine savings.
Staff -- Modern Materials Handling, 3/19/2009
The Reusable Packaging Association (RPA) has created a Reusable Packaging Economic Calculator to help businesses determine the cost savings of switching from single-use corrugated packaging to reusable packaging.
"Now more than ever, businesses are trying to reduce their operating expenses, and reusable transport packaging is a proven and effective way to reduce costs," said Bob Klimko, chairman of the RPA board and director of general industrial marketing for ORBIS Corporation.
The Reusable Packaging Economic Calculator is based on a financial model that covers the key concepts in the comparison of the per container cost of both reusable and single-use packaging. The tool allows a potential reusable packaging user to perform some basic financial analysis to determine if the supply chain in question is financially conducive to reusable packaging. The calculator was developed in cooperation with StopWaste.Org.
The model compares basic cost differences of single-use corrugated packaging and reusable packaging. The calculator factors in corrugated costs, dwell time (how long containers are held at various stages of the supply chain), cartons shipped annually, annual interest rate, return miles for reusables and the expected replacement rate. While the model uses factual inputs from prospective users, it is intended to offer guidance and not an absolute indication of exact cost benefits. More specific models are available to determine specific cost benefits, and additional assistance is available from RPA member companies.
“The calculator is a great tool for potential users to show their chief financial officers and others in the company the hard numbers to start a conversation about switching to reusable packaging,” said Jerry Welcome, RPA president. “In addition to these quantifiable savings, reusable packaging has been proven to reduce costs in other ways, including reducing product damage caused by faulty containers, reducing labor costs and injuries, reducing space required for inventory and increasing productivity. These savings can help businesses weather today’s challenging economic environment.”
Incorporating reusable packaging into the supply chain also can help corporations meet their environmental and sustainability objectives. Reusable containers have been proven to reduce solid waste and greenhouse gas emissions, improve transportation efficiency, and reduce energy use. These claims were substantiated in a landmark study conducted by Franklin Associates in 2004, Life Cycle Inventory of Reusable Plastic Containers and Display Ready Corrugated Containers Used for Fresh Produce Applications.
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