• Waste, Business

Optimizing changes to packaging can lead to less food waste and a better carbon footprint

David Feber is a partner at McKinsey & Company, a global management consulting firm, with 30,000 employees and offices all over the world. He is based out of Detroit and leads the Global Packaging Service Line for McKinsey. What is striking about Feber is that he talks about packaging, his field of expertise, the way others talk about sports: with incredible knowledge, openness and honesty. He is first and foremost a fan of packaging, and believes that the companies that will do well in the future are the ones gravitating towards fully recyclable packaging solutions right now.

For Feber, a simple trip to the grocery store can be a revelatory experience. “I recently got a box of apples from a warehouse store; they used to come packed in these thermoform packs. The new way they are packaged is incredible: this micro-fluted corrugated box that is really thin with lots of holes in it. It uses less pulp, which means less water, which is spectacular for the environment.”

For the consumer, this new packaging means the apples are visible. For the store selling the apples and the people shipping them, it means that the box is strong enough to be stacked on a pallet directly. “And I was thinking, ‘That is so cool!’— I showed my kids and they were not nearly as excited as I was,” he shares. 

‘The packaging industry touches everything'

At USD 900 billion, the entire global packaging industry is fairly large, but to put it into perspective it is worth noting that it is just a bit smaller than one company: Amazon, which has USD 110 billion in annual sales. But Feber suggests that monetary size belies the huge importance that packages have in our lives.

“The packaging industry in general is incredibly important to the world, and it is a very large industry sector,” he says. “But it touches everything. Think about the very large percentage of the global population who eats food grown or made further than fifty miles from them: all that food had to be packaged to get to you safely. Then factor in medicine and personal care, and you begin to realize that the packaging industry touches most — almost all — of the people in the world.”

Feber is keenly aware that what some might dismiss as a simple box or carton is actually the end product of a long process. “A lot of people put a lot of hard work into packaging and each of them has their own wants and needs for packaging. I help people think through the entire process, think of it differently, and ultimately think about how to create value in packaging.”

Trends that pay dividends

One of the biggest changes that David sees in the near future is the shift from items that would have been sold at supermarkets that are now being shipped direct to consumer. “A lot of packaging has not been designed for e-commerce. Now, it is such a significant part of the channel that we project it is going to go up to 20% of the entire grocery category in the next four or five years. Before the pandemic, that number was just 3%.”

McKinsey forecasts that this is going to cause a lot of package changes to be optimized; drop testing alone will have to be doubled. But ultimately this will lead to less food waste, and a better carbon footprint.

“Even with one small change in packaging design, everybody wins. There is no downside."

As excited as a sports fan would be to crow about their favorite team winning a big game, Feber eagerly shares an example to illustrate how small changes can pay off big time. “When I was in the packaging industry, one of the companies I worked for migrated from round juice bottles to rectangular ones. It turns out that just one change from round to rectangular shapes meant that you could get around 15% more on a pallet, which meant that we could ship more, which meant that the shipping costs were less, and it had a lower carbon footprint. Everybody wins. There is no downside.”

Sustainability-related issues confronting the packaging industry

Greenwashing is one of the biggest issues that the packaging industry faces as the shift to sustainable solutions continues. “Whereas there are many companies that have made strong progress with sustainability, it can be disingenuous for some companies to say that they are environmentally responsible to their customers when they are not,” he points out, as some brands claim to the consumer that they are using both compostable and recycled plastic in the same product when, in fact, the packaging is impossible to separate into distinct components. “Those are all great solutions individually, but when you combine them, the product cannot be composted or recycled.”

He also expresses concern about how some well-meaning but ill-informed environmentalists are using social media to fight the wrong fight. “You often hear things like ‘We want to get rid of plastic packaging’ from companies, but you cannot paint all plastics with that one brush. There are multiple, different types of plastic, each of which has a different sustainability narrative. And consumers are getting really confused,” he adds. “The companies that will do well in the future are the ones who are right now gravitating towards fully recyclable packaging solutions.”

New solutions for old problems

USD 161 billion worth of fruit and vegetables are thrown away each year, a figure that could soon see a big decline thanks to new technology. It sounds like something out of a science-fiction novel, yet it is a solution to a problem as everyday as a Seinfeld episode.

“The challenge with a lot of fresh produce and a lot of fresh food in general is that they will spoil eventually,” Feber says. “There is a company that is inventing rewritable produce labels digitally, that change the price as the product gets older. So, if a consumer knows if that they are going to consume this in the next 48 hours, it will cost X amount of dollars or cents. If it just got into the store that morning and will stay fresh longer, it might cost a little more.”

Feber marvels at this incredible achievement. “It makes me hopeful for the future,” he says.

This article is part of a series where different stakeholders discuss how fit for purpose packaging is essential for sustainable food systems. The articles are published ahead of our virtual roundtable.

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