Summit News

Packaging matters as food companies innovate

CHICAGO (Reuters) - As food companies develop products to attract consumers looking to do good for their bodies, shoppers are also increasingly interested in packaging that does good for the Earth, a food and retail industry consultant said on Monday.

Cannondale principal Ken Harris speaks during the Reuters Food Summit in Chicago March 5, 2007. REUTERS/John Gress (UNITED STATES)

The push for environmentally friendly packaging has not reached the level in the United States that it has in other countries, Kenneth Harris, a managing director at Cannondale Associates, said at the Reuters Food Summit in Chicago. But foodmakers need to be aware that consumers are paying more attention about how much waste is in packaging, he said.

“How do we either take advantage of that if you want to be Machiavellian about it?” Harris said, commenting on how manufacturers can address the concerns. “Or how do we at least not find ourselves caught in a bad situation because we didn’t observe that this thing was going on?”

Wal-Mart Stores Inc. WMT.N last year said it would push its suppliers to cut the amount of packaging used in products sold through the world's largest retailer by 5 percent under a five-year plan that would begin in 2008.

That push could encourage manufacturers to develop more environmentally friendly packages in the United States, where Harris said consumers are not clamoring for reduced packaging waste as much as people are in parts of Europe.


In Britain, retailers like Tesco Plc TSCO.L and J. Sainsbury Plc SBRY.L have seen customers pulling apart packaging and leaving it in the parking lot to send an environmental message, Harris said.

“People don’t want to even take the large packages home and they’ve seen this huge groundswell of rubbish in the parking lot,” he said.

Changing packaging can be costly, Harris noted, with companies having to recalibrate the machines on their production lines and even develop new forms of packages.

For example, he noted that breakfast bars currently come in boxes made of cardboard. Those boxes need to leave a certain amount of space around the product to avoid crushing. But manufacturers could consider other more durable materials, he said.

Another risk for manufacturers, though, is that smaller packages reduce the products’ presence on store shelves, making it harder to catch consumers’ attention as they walk down the aisle.

But Harris said the same thing happened in the deodorant section of the store several years ago when manufacturers were pushed to reduce the package size. What resulted was a complete change in the system that the packages were loaded on the shelves, with a mechanism that pushes the rest of the packages forward as each product is removed.

Environmentally friendly packaging does not always have to be smaller, though. Sara Lee Corp. SLE.N Chairman and Chief Executive Brenda Barnes said at a conference in February that sales of its Hillshire Farm Deli Select meats were helped by a change in packaging to larger plastic tubs from smaller packages that wrapped the meat more tightly in plastic.

But when questioned by reporters on whether the larger tubs added to environmental waste, Barnes said that consumers actually reuse the tubs for storage, helping cut down on waste.