Spending on packaging by consumer packaged goods (CPG) brands has grown over the past two years — and will continue to do so over the next two years, according to a recent study of CPG brand owners by global strategy consulting firm L.E.K. Consulting. In fact, the increased spending on packaging is expected to grow well in excess of inflation.
Brand Owners Spending More on Packaging — and Don’t Plan To Stop
Paper, Climate Change and Common Sense
Submitted: Kathi Rowzie August 18, 2021
The UN Intergovernmental Panel on Climate Change (IPCC) recently released updated projections about the effects of human activity on our planet, warning that inaction to immediately address climate risk will yield dire consequences. The IPCC’s conclusions and recommendations will no doubt be the subject of continuing debate, but there are three things that most people agree on: the climate is warming, humans play a role, and we need to do something about it.
However, without broad-based public understanding of how the environment works, there is an unfortunate tendency to believe that all manufacturing industries and processes must be part of the problem, a misconception that some in the ENGO community and the news media are only too happy to exploit. They push the thoroughly unscientific narrative that paper contributes massive amounts of carbon dioxide (CO2) to the atmosphere, a byproduct of tree harvesting, manufacturing processes and paper waste. Far from mitigating climate change, it’s a narrative that could stifle an industry that is, in reality, a part of the solution.
Mitigating climate change demands a common-sense approach that is grounded in sound science, embraces proven strategies, and invests in driving continuous improvement. This approach, in a nutshell, is why the North America paper and paper-based packaging industry is a climate mitigation leader.
Paper’s Carbon Footprint
A look across the life cycle of paper shows that its carbon footprint can be divided into three basic elements: carbon sequestration, greenhouse gas emissions and avoided emissions. Each of these elements is influenced by important characteristics that distinguish paper from other products: it’s made from a renewable resource that stores carbon, it’s manufactured using mostly renewable, carbon neutral energy, and it’s easily recyclable.
Sustainable Forestry and Carbon Sequestration
Sustainable forest management, the cornerstone of the North American paper and paper-based packaging industry, helps increase the ability of forests to sequester carbon while also protecting and conserving other forest values like soil, air and water quality, wildlife habitat and biodiversity. An infinitely renewable resource, healthy forests sequester carbon by capturing CO2 from the atmosphere and transforming it into biomass through photosynthesis. The carbon stored in forests helps to offset releases of CO2 into the atmosphere from sources like the burning of fossil fuels and deforestation (the permanent loss of trees).
The U.S. Environmental Protection Agency (EPA) reports that sustainable forest management practices resulted in net carbon sequestration each year between 1990 and 2018. As reported in the agency’s Inventory of Greenhouse Gas (GHG) Emissions and Sinks, U.S. forests and wood products captured and stored roughly 12% of all carbon dioxide equivalent (CO2e) emissions in 2018. CO2e is a measure of the global warming potential of all GHGs compared to CO2. The Canadian government reports that forestlands captured and stored around 19% of the country’s total CO2e emissions in 2018.
Planting new trees and improving forest health through thinning and prescribed burning are some of the ways to increase the uptake of forest carbon in the long run. According to the U.S. Forest Service, the perpetual cycle of harvesting and regenerating forests can also result in net carbon sequestration in products made from wood and in new forest growth. In its 2020 Global Forest Resources Assessment, the U.N Food and Agriculture Organization reported that net forest area in the U.S. increased by approximately 18 million acres between 1990 and 2020, while net forest area in Canada remained stable at around 857 million acres during those same years.
The Paper Industry and Greenhouse Gas Emissions
The North American paper and paper-based packaging industry was among the first industries to take voluntary action to reduce GHG emissions. Between 2011 and 2019, the U.S. industry reduced greenhouse gas emissions from 44.2 million metric tons to 35.2 million metric tons or 20%, according to the US EPA. Natural Resources Canada (NRCan) reports that between 2007 and 2017 the Canadian industry reduced GHG emissions from 22 million metric tons to 13.1 million metric tons or 40%.
These reductions are attributed to the predominant use of carbon-neutral, wood-based biofuel (which accounts on average for around 60% of energy generation at North American mills), the switch from coal and oil to less carbon intensive fuels such as natural gas, and investment in equipment and process enhancements that improved overall energy efficiency. Contrary to the claim that the North America paper and paper-based packaging industry is a major contributor to GHG emissions, EPA and NRCan data show that U.S. and Canadian producers account for only 0.5% of total GHGs in their respective countries. A continuing increase in the use of biomass energy at North American mills has the potential to reduce GHG emissions even further.
Some in the ENGO community argue that because biomass releases just as much CO2 in the atmosphere as fossil fuels, it isn’t really carbon neutral. But the U.S. Department of Energy (DOE) and other experts disagree. As DOE explains: “Burning biomass releases about the same amount of carbon dioxide as burning fossil fuels. However, fossil fuels release carbon dioxide captured by photosynthesis millions of years ago – an essentially “new” greenhouse gas. Biomass, on the other hand, releases carbon dioxide that is largely balanced by the carbon dioxide captured in its own growth.”
In other words, biomass contains carbon that was only recently removed from the atmosphere by photosynthesis, and that same carbon is returned to the atmosphere as part of the natural carbon cycle when it is burned to generate energy. This inherent property exists whether or not trees are regrown. Sustainable forest management practices help make sure that biofuel use does not outpace forest regrowth. The IPCC concludes that, “Regardless of how carbon neutrality is defined and calculated, the use of forest biomass produced under conditions where forest carbon stocks are stable or increasing always yields long-term mitigation benefits.”
Avoided Emissions: Paper’s Recycling Success Story
When paper products are sent to landfills, they release GHGs as they decompose. When they are recycled, these GHG emissions are avoided. That’s a significant environmental benefit when you consider that around two-thirds of all paper and paper-based packaging is recovered for recycling in the U.S. and Canada, more than plastics, glass and metals combined. When you single out corrugated cardboard, the recovery rate jumps to nearly 90%. The US EPA reports that the amount of paper and paper-based packaging that was recycled instead of going to landfills lowered U.S. GHG emissions by 155 million metric tons of CO2e in 2018, an amount equivalent to taking over 33 million cars off the road for an entire year.
The North American paper industry continues to invest billions of dollars in technology to increase the types of paper products that can be recycled as well as infrastructure investments that expand recycling capacity. For example, U.S. producers have announced or planned $4.5 billion in manufacturing infrastructure investments by 2023, more than $2.5 million per day. The industry also is focused on “recyclable by design” innovations that help brands, retailers and other end users develop fully recyclable paper packaging by eliminating non-recyclable elements.
Paper producers’ commitment to sustainable forest management, the use of renewable, carbon neutral energy, and strong support and investment in recycling has transformed the circularity of paper products from vision to reality, and will help to drive further GHG emission reductions.
For more facts about the sustainability of print, paper and paper-based packaging, click here.
Metalized Film to Board Lamination Boosts Product Visibility
MET-PET Helps Brand Managers Develop Attractive Packaging
Catching the consumer’s eye on crowded store shelves with a memorable look that conveys quality is the goal of every brand manager. Sierra Coating Technologies LLC, a Wisconsin-based coater laminator, supplies printers with packaging stock that helps their customers’ products shine.
Sierra uses metalized film to board lamination (MET-PET) technology that helps brands leverage the high-profile packaging that on-shelf advertising offers.
“Our metalized film to board lamination products help brand managers differentiate the shelf appeal of their products,” says Paul Smale, national sales director at Sierra Coating Technologies. “We are a great partner for printers that need to provide a cost-effective way for brands to tip the visual scales in their favor.”
MET-PET Packaging Stands Out From the Crowd
Sierra has developed a silver folding carton grade made with MET-PET film laminated to SBS board stock. This film proves an exceptionally high surface shine and lamination quality.
Metalized film to board lamination gives packaging stock a unique look that brands and printers often use in making folding cartons for retail packages. Board thicknesses can range from 8-point to 24-point, that is sheeted to size.
“All of our products are made to order, and we also work with stocking distributors to provide ready inventory for their customers,” notes Smale. “Our focus is on delivering high-quality products on time and at a good price.”
About Sierra Coating Technologies LLC
Sierra Coating Technologies LLC, based in De Pere, Wisconsin, is a coater laminator that works with brand managers and printers to create eye-catching stock for use in retail products and packaging. For more information on Sierra Coating Technologies or to request a quote, go to https://www.sierracoating.com/ or call 920-983-8008.
How Major Retailers are Redefining the Sustainable Packaging Game
As consumer preferences continue to shift, with more people seeking eco friendly, sustainable packaging in the products they buy, some of the world’s biggest retailers are taking note. Both Walmart and Amazon, for instance, have launched comprehensive packaging sustainability initiatives.
Walmart’s Packaging Scorecard
Just over a decade ago, Walmart introduced their proprietary Packaging Scorecard to companies throughout their supply chain.
Working with guidelines established by the Packaging Sustainable Value Network, a group of leading companies in the packaging industry, Walmart’s Packaging Scorecard identified nine key metrics to consider when designing and creating eco friendly packaging:
- Greenhouse gas/CO2 generation per ton of packaging produced
- Material value
- Product-to-package ratio
- Cube utilization
- Recycled content
- Recovery value
- Renewable energy use
Each of these environmentally relevant metrics is represented as a percentage of 100 possible points for rating existing packaging, developing new packaging, and comparing one’s own environmentally friendly packaging solutions to those of other companies.
Walmart doubled down on their sustainable initiatives in 2016 when they released their Sustainable Packaging Playbook — which focuses on optimizing packaging design, securing sustainable material sources, and supporting recycling — to help guide companies toward methods for improvement.
Amazon’s Certification Guidelines
Walmart is not alone in recognizing the importance of sustainable packaging, both for the environment and manufacturer ROI. In 2008, Amazon, the world’s largest online retailers, introduced their own eco friendly packaging initiative, the Frustration-Free Packaging Program.
Frustration-Free Packaging takes a more consumer-oriented approach — its main goal is to ease “wrap rage,” the frustration that consumers often feel when faced with excessive amounts of packaging materials or difficult-to-open designs.
The program aims to drastically reduce the number of boxes used in shipping, as well as packaging materials in general, such as clamshells, wire ties, and plastic bindings. By putting a focus on material reduction and recyclability, Frustration-Free Packaging is also eco friendly packaging.
Taking the Eco-Friendly Packaging Leap
Manufacturers large and small, and from all types of industries, are increasingly adopting the sustainable packaging requirements set into motion by mega-retailers like Walmart and Amazon.
These practices are often considered to be cost-ineffective for manufacturers, but with the right amount of research and analysis, environmentally friendly packaging practices can actually lead to significant cost savings.
Have you been considering making the switch to eco friendly packaging? Download Sierra Coating Technologies’ free eBook, “Taking the Eco-Friendly Packaging Leap,” to learn how to take the first steps and explore the unique benefits of various types of packaging, such as recyclable and compostable. Or, to discuss your unique packaging needs with an expert, contact the team at Sierra today.
The Rise of Single-Serve Food Packaging
As consumer preferences shift and technologies advance in both the food and beverage and the food packaging industries, smaller-sized packages are becoming more popular. Thanks to an increased focus on health, convenience, and environmental sustainability, single-serve and miniature food packaging solutions are in high demand.
With consumers now placing more importance on dietary intake — having a better understanding of what they’re eating and how much they should be eating — single-serve packaging is becoming the go-to choice for many health-conscious consumers.
Ease of use is another factor; in today’s fast-paced world, consumers desire portability, the ability to eat on the go, kid-friendliness, the ability to meet TSA regulations, and so on.
And finally, as environmental and sustainability concerns mount, steps are now being taken to reduce the risk of food spoilage while minimizing waste.
Companies Driving Demand for Single-Serve Food Packaging
The fast food industry has long depended on miniature packaging for on-the-go, portable condiments, salt, pepper, and other items. More recently, changes to kids’ meals, such as the inclusion of fruit as a side-dish option, are necessitating new miniature packaging solutions.
Traditional retail food producers are also beginning to require single-serve food packaging solutions. Yogurt and beverage producers are introducing portable standup pouches, while producers of items like jam and nut butters are increasing the number and variety of single-serve cup options. Companies in the spice industry are also expanding their product offerings to include individual and premeasured retail options.
Meal-kit services like Blue Apron, Plated, and HelloFresh are some of the largest — and newest — drivers of the single-serve trend in food packaging, as these companies depend on miniature and single-serve packaging to effectively portion out ingredients for consumers. Using this type of packaging for meal-kit services allows for optimal portability and intuitive consumer use.
How Companies are Meeting the Demand for Single-Serve Packaging
Food and food packaging companies are now pursuing various methods to meet consumers’ desire for conveniently packaged food. The specific solutions used, however, depend on the food product itself.
For instance, creating snack-sized packaging — or “snackifying” products — is an increasingly popular technique.
Snack-style packaging designs can be used for a range of products, such as single-serve spices and condiments for at-home use. This type of packaging is novel, convenient, and can help with portion control for consumers with health and dietary concerns.
Nutrition information labeling is also becoming more and more important; in addition to meeting FDA labeling guidelines, food packaging must also appeal to consumer sensibilities — a recent report showed that 61% of grocery shoppers believe that reading food packaging labels is an important step in maintaining health.
The “rightsizing” or downsizing trend in food packaging makes it easier for consumers to portion control and understand the nutritional value of the foods they’re purchasing.
Because producing miniature and single-serve packages inevitably increases the volume of packaging material used and ultimately disposed of, many companies are also focusing on environmentally friendly packaging initiatives.
To reduce waste and meet the growing consumer demand for sustainable business practices, many food packaging companies are offering compostable and even biodegradable packaging products, which are commonly produced using polylactic acid (PLA) based materials.
Partnering with an Experienced Contract and Toll Manufacturer
As demand rises for convenient, sustainable, and healthy food options, food and beverage producers and packaging companies are consistently working on innovation solutions to meet those demands.
To do so, companies often must partner with experienced contract or toll manufacturers; these experts can offer a wide range of services to help food-industry and food-packaging businesses create reliable miniature and single-serve packaging products.
Sierra Coating Technologies is proud to provide industry-leading contract and toll manufacturing services for the food packaging industry. To learn about the cost-saving benefits of working with a contract manufacturer, download our free eBook, “The Financial Case for Contract Manufacturing.”
Recycled Packaging & How it Impacts the Food Industry
Walmart Scorecard’s Impact on Packaging
During a PACK Expo keynote in 2006, Walmart launched the packaging scorecard initiative. Since then, brands have been continuing to update and revise their packaging to create a more environmentally-friendly solution. Below is an outline of how the sustainable initiative has impacted the food industry across various package types, including paper-based, plastic, glass, and aluminum.
Paper-Based Packaging and Poly-Replacements
Paper and paper-based products, such as cartons and paperboard, are easy to recycle, and the resultant recycled material is extremely versatile. More than half of Americans have easy access to paper recycling — an amount which is expected to increase rapidly — and there are far fewer restrictions on recycling paper than plastic.
For applications such as food safe packaging and high-end brand displays, coatings are utilized to provide the appropriate properties. To achieve a recyclable, paper-based package for these types of applications, water-based coatings are often required.
To address this, Sierra is working with nationally-recognized chemical companies to qualify reliable eco-friendly coatings. Our water-based, eco-friendly coatings can meet biodegradable, compostable, and fully recyclable requirements. These coatings also possess important properties to aid in brand awareness efforts; they are easy to print over and allow for optimal packaging aesthetics.
Plastic Brand Packaging
One of the biggest challenges with recyclable, plastic packaging is the restrictions involved with recycling plastic material. It is estimated that 95% of recyclable plastic packaging, amounting between $80 and $120 billion worth of packaging material, is wasted on an annual basis.
While outreach, recovery, reclamation, and recycling efforts can be effective for multinational corporations, they may be cost-prohibitive for smaller or regional brands. For these businesses, investing in eco-friendly packaging is often a more practical, actionable solution.
Recycling plastic presents a three-fold problem:
- Public access to plastic recycling facilities or programs is surprisingly limited;
- Different municipalities levy often confusing recyclability restrictions based on plastic type, size, and shape; and
- The recycling process is costly in terms of money and energy use.
Aluminum, Glass and Plastic Bottles
As demand rises for sustainable products, brands are prioritizing green initiatives, such as eco-friendly packaging and packaging recovery.
The Coca-Cola Company, for example, has established an extremely ambitious recycling initiative — by 2020, they aim to recover and recycle a full 75% of the beverage containers, bottles, and cans they produce annually. Working with The Recycling Partnership, Coca-Cola has already recycled 59% of their output.
This is just one example of the growing sentiment in favor of environmentally conscious initiatives; worldwide, consumers are looking to brands to lead conservation efforts with sustainable, environmentally friendly packaging options.
To learn how to make your food packaging eco-friendly without sacrificing your unique brand identity, contact our chemical experts.
Biodegradable Packaging Options
Investing in environmentally-friendly packaging is quickly gaining momentum in many industries, including food and beverage. From a product development perspective, our paper experts have seen biodegradable packaging become increasingly popular.
According to the Environmental Protection Agency (EPA), a material can be described as biodegradable when it is “capable of being decomposed by the action of biological processes.”
In other words, a material is biodegradable if it will decompose within a reasonable amount of time when left outside in natural conditions.
Packaging Materials and their Biodegradation Process
Glass, commonly used for packaging beverages and various high-end products, is not biodegradable. In fact, it can take up to 1,000,000 years to biodegrade. Plastics are not biodegradable, either; polyvinyl chloride (PVC), often used in food and beverage applications, is capable of physical breakdown but never truly decomposes. Polyethylene (also known as polythene or simply “poly”), another popular food packaging plastic, takes up to 1,000 years to biodegrade. Other plastics can take various lengths of time to biodegrade, averaging at about 450 years.
These packaging decomposition rates are untenable when striving for increased sustainability. Paper, on the other hand, is an ideal biodegradable option, taking anywhere from two to five months to decompose.
Biodegradable vs. Compostable
Because the terms are often incorrectly interchanged, biodegradability and compostability are frequently conflated. Adding to the confusion is the fact that the processes involve the same action — decomposing a material into an organic state. This decomposition occurs in two very different ways, however.
Compostable materials decompose only when in a carefully controlled environment, where factors such as source material, moisture content, temperature, oxygen levels, and acidity are all closely monitored. Biodegradable materials decompose through a chemical process where micro-organisms break down the materials resulting in carbon dioxide, methane, and biomass.
Paper is much more biodegradable than plastic or glass. Some paper can decompose faster than fully organic products. For example, paper towels often biodegrade quicker than thick fruit rinds such as orange or banana peels. However, it’s important to keep in mind that not all paper products biodegrade at the same rate.
Less processed papers, such as mechanically pulped products, biodegrade at slower rates than more highly processed papers. Paper containing mechanical pulp has higher amounts of lignin — very complex phenolic polymers found in the cell walls of trees — which interferes with biodegradation.
Designing Eco-Friendly Packaging
The right coating can provide resistance to grease, oil, water, oxygen-exposure, or a combination of these food-safe properties for paper-based packaging; while maintaining the eco-friendly standard. However, these types of properties are often provided by poly- or PVC-based substrates, thereby negating any of the potential environmental benefits of using paper in packaging.
To counter this issue and create truly environmentally friendly packaging, Sierra Coating Technologies has partnered with some of the nation’s most accomplished chemical companies to develop several biodegradable coatings.
As a leading contract and toll manufacturer of eco-friendly coating and lamination solutions, including poly and PVC replacements, Sierra is proud to be a part of the push toward sustainability. The benefit of working with Sierra is that we run tests on our production equipment to ensure the materials and substrates will run efficiently during a full-line production. If you’re ready to make the switch to environmentally friendly packaging, contact our chemical experts.
How to Choose the Right Eco Friendly Packaging –
Biodegradable vs. Compostable vs. Recyclable
For many years, plastic has been the standard in packaging. As concerns mount over environmental issues, however, there’s increasing demand for sustainable alternatives.
In some cities, such as San Francisco, governments are passing legislation that bans the use of plastic bags, while many retailers are proactively taking steps to “go green.” Popular food retailer Whole Foods, for instance, no longer uses plastic bags, and 60% of Apple’s paper packaging is now made from recycled wood fibers.
According to a recent survey, over half of American consumers said they would choose green products over conventional options if given the choice.
Green packaging is no longer just a niche marketing tactic; with long-term benefits easily outweighing the added costs, they’re imperative for remaining competitive in today’s changing landscape.
Making the decision to go green is simple. Understanding the various packaging options, costs, and marketing claims is often a challenge for brand owners.
Sierra Coating has been researching and working with poly replacement alternatives for years. Our team can shorten the product development stage by having already screened and tested a number of market-ready alternatives.
When developing an eco friendly package, it’s important to consider the specific usage standards that your application requires as well as material disposal methods.
The Ideal Solution
When choosing between biodegradable, compostable, and recyclable packaging; it’s important to ensure the chosen material does, in fact, reduce waste efficiently and effectively.
At current standards, there are three optimal solutions for creating an eco friendly package:
- Make the package smaller to reduce your footprint
- Utilize recycled materials to create the package
- Create a recyclable package that can be disposed of in a sustainable manner
For many packaging applications, paper is an ideal solution. Folding cartons are ubiquitous; they are used to ship everything from electronics to pharmaceuticals and provide a sustainable, customer-friendly experience.
Folding cartons can be made out of recycled materials and coated with environmentally-sustainable barrier coatings. Not only is folding carton sturdy, lightweight, and customizable; it’s also cost efficient.
Eco-Friendly Packaging and Disposal Options
Compostable Packaging’s Geographic Limitations
When disposed of properly, compostable products will break down through microbial digestion into humus, providing valuable nutrients to the soil without releasing toxins or metals.
Under the right conditions, this process takes approximately 180 days. However, this is rarely the case. According to ASTM standards, compostable products must be disposed of at a municipal or industrial facility that uses heat to properly break down the product.
Retailers rarely have control over consumers’ disposal methods. Compost facilities are usually located in major cities, limiting the impact and effectiveness of a brand’s sustainability effort.
More often than not, materials end up in trash cans and eventually in landfills, which are not conducive to the sustainability goal of the compostable package.
Biodegradable Packaging’s Greenwashing Association
Biodegradable packaging materials are broken down by bacteria, fungi, or other microorganisms. This occurs through either anaerobic (without oxygen) or aerobic (with oxygen) degradation.
Unlike other sustainable products, biodegradable materials are not required to meet any specific industry standards or regulations.
And because virtually everything is biodegradable, whether it happens in one year or 100, marketers often exaggerate claims of biodegradability. In fact, the ubiquity of the term has come to be associated with “greenwashing,” misleading consumers about the true environmental impact.
To combat this, the Federal Trade Commission (FTC) has set forth the Green Guidelines as a benchmark for marketers.
These guidelines state that a biodegradable product “will completely break down and return to nature within a reasonably short period of time after customer disposal.” However, the FTC has yet to pinpoint what is considered a reasonably short period.
Recyclable Packaging: The Most Eco Friendly Option
Recyclable packaging, on the other hand, can be remanufactured into something new after its initial use. Similar to composting, the efficacy of recycling depends on a number of factors.
First, the end user must make the decision to recycle the product, and their recycling center must have the capabilities to recycle that specific material. (Recycling guidelines can vary greatly by region). Also, the product cannot contain any food contamination.
When these requirements are met, recyclable packaging is often the most eco friendly option, since it allows the material to be reused for the same purpose.
Although recycled material requires energy, it still increases the overall product lifecycle. Manufacturers can also take more responsibility themselves by using recycled material as an input of the base product, rather than relying solely on the consumer to recycle.
Additional Resources for Packaging Engineers
At Sierra Coating Technologies, our team of experts can work with you through the development process and customize packaging solutions for your unique needs. Interested in learning more about green, paper-based packaging options?
Further your search and gain a clearer understanding of industry-specific applications with our Glossary of Top Misunderstood Terms in the Paper Industry, or contact our team directly to discuss your next project.
How Chemical Companies Work with Toll Coaters
Introducing Sierra’s Business Alliance Program
Though there are many keys to success in product development, two are most notable: speed to market and proof of production. To address the time and costs factors associated with developing a new product, business alliances are a great way to work efficiently and effectively.
For example, many chemical companies invest heavily in the development of new products, but need to show proof of a successful production process and provide finished goods to show potential customers. By working with a coating company in the pre-market stage of product development, a chemical company can expedite a new coating to market.
Why Sierra Customers Toll Coat
According to Robert Porter Lynch’s Business Alliance Guide, a “variation of product alliances is the joint manufacturing venture, where, because of scale costs, it makes economic sense to build a plant of large capacity, but no one company’s market can support the entire production capacity” (page 59).
It is for this reason that contract and toll manufacturers exist — to absorb the fixed overhead costs associated with running a facility, providing clients with a way to create a purely variable cost method of developing new products.
Business Alliance Advantages
There are a number of benefits to forming a business alliance. Primary among them are access to production equipment and technical experience in coating.
When working with a manufacturer who has partnered with clients across a variety of industries, you benefit from having a highly knowledgeable product development expert with wide-ranging industry contacts.
Alliances also facilitate knowledge sharing between companies and can allow for new product applications in niche markets.
Sierra Coating’s Chemical Business Alliance Program
As part of our Sierra Chemical Business Alliance Program, we are currently looking to form dedicated alliances with chemical companies that have developed innovative product solutions of their own. Sierra often recommends water-based chemicals for our clients’ products in order to meet their specific needs.
As a trusted toll and contract manufacturer with services, such as raw material planning, our team works with paper mills, printers, and brand owners to help develop new products.
To best guide our clients in choosing the proper chemicals to use, Sierra also works with chemical companies to develop a solution for our client’s requirements. Through this process, we facilitate growth for both our customers and ourselves.
What Our Clients are Looking For
Sierra serves clients across a wide variety of industries, but certain requirements come up more often than others. Our expertise is particularly pronounced in industries — such as the food and beverage, health and beauty, and retail industries, to name a few — that have product needs requiring unique and highly specialized chemical treatments.
We frequently receive inquiries about innovative food-safe packaging, eco-friendly packaging and other poly replacements, heat seal and blister pack coating, and high-end luxury packaging. These are fast moving spaces that require regular innovation and reinvention to not only stay ahead of trends but to keep products compliant with ever-changing industry standards and guidelines.
The Advantages of Toll and Contract Manufacturing
Developing On-Demand Services in Manufacturing
Consumers have grown accustomed to getting what they want, when they want it —services like Uber, Seamless, and Netflix are examples of how this on-demand business model can be successful. What if the on-demand model could be expanded to the manufacturing space?
Contract and toll manufacturing are prime examples of how the industry is ripe for the instant gratification marketplace. These two supply chain management strategies use the “sharing economy” model of on-demand services to help customers save time and money during product development.
Toll versus Contract Manufacturing
In toll manufacturing, a company provides a third party with raw materials to complete the manufacturing process for them. The toll manufacturer, equipped with the necessary production equipment and specialists, charges the company a fee (a toll) to finish the job.
Contract manufacturing is a similar process, except the contract manufacturer is responsible for sourcing raw materials in addition to making the product, meeting customer specifications, and adhering to delivery time requirements.
The Cost-Saving Benefits
OEMs and other industrial manufacturers can apply the on-demand service model to their businesses by taking advantage of toll and contract manufacturing.
By going to a third-party when they need specific services, companies avoid the investment required for additional equipment, facilities, and employees. In turn, they receive the services they need, when they need them, while saving time and money.
This on-demand service model is ideal for new product development, seasonal projects, and testing products by utilizing a variable-cost operation.
Contract and toll manufacturers allow companies more flexibility no matter what stage of production they are in. During product development, for example, companies can contract a manufacturer to begin production while still building their own facility.
They can also reach out to contract manufacturers for assistance producing high-quantity orders during overflow production or to help source and test materials during first-run production.
Sierra Coating operates as a toll and contract manufacturing organization (CMO) providing critical on-demand laminating services to our customers. To learn more about this model and the financial advantages of employing a contract or toll manufacturer, download a free copy of our eBook, “The Financial Case for Contract Manufacturing.”