April 22nd is ‘Earth Day’, when an estimated billion people globally will show their support for the environment and promoting sustainability. Growing from the 20 million Americans who joined the first Earth Day celebrations in 1970, it is now marked across 195 countries and is the largest mass observance movement in the world.
Organized by the Earth Day Network, this year the focus is on drastically reducing plastic pollution which litters our oceans and is clogging up landfill sites. For example, 500 million plastic straws are used every day in America. That’s enough to circle the Earth twice… So when it takes 200 hundred years for an aluminium can and 450 years for a plastic bottle to biodegrade, yet only 9% of all plastics are recycled, with the rest ending up as landfill or in the environment, in every sense, we cannot afford to ignore this problem.
With over 30% of all food and the associated packaging wasted globally each year, all of us, at whatever level, across the CPG industry must accept some responsibility. To put the scale of this issue into some context, ideas.TED.com estimates “America has twice as much food on its shop shelves… than is actually required to feed all its residents”. For this, as foodrescue.net says, 10% of the nation’s total energy budget, 50% of its land, and 80% of all U.S. freshwater consumption is dedicated to the production and distribution of food. Almost half of which then ends up as landfill.
The are many reasons for this level of surplus, with poor demand forecasting by both CPG companies and retailers, and the knock-on effects, being high up the list. So, as the Environmental Science and Technology organization highlights, “the key underlying questions… are how can we make the food supply chain smarter and more efficient”.
Not only will addressing these questions reduce the quantity of waste, there are also sound financial reasons to do so. According to the United Nations, food wastage in 2014 globally cost $2.6 trillion, which is a number that is hard to get your head around. At a more tangible level, then, it can cost a CPG company over 80% of a product’s standard margin to produce, ship, and fund overstocks, and possibly more if “Clearance Payments” for promoted lines are included. Essentially then having appropriate amounts of stock on shelves avoids waste, reduces pollution and increases margins.
From community groups to national governments there are now an increasing number of initiatives that are addressing these issues. Within the CPG industry Qui!Greens, is a French start-up, facilitating a local no-waste attitude across the supply chain, whilst the Dutch supermarket chain Ekoplaza, is rolling out plastic free aisles across it’s estate, and on a national level in Norway a government scheme has led to 97% of all plastic bottles being recycled. Manufacturers too are tackling the problem, with just for example, Danone’s Evian aiming to be a “100% circular brand” globally by 2025 or P&G, working with the re-cycling company Terracycle to manufacture Head & Shoulders bottles partially made from plastic collected from waterways and beaches.
We at UpClear endorse the aims of ‘Earth Day’, and are encouraged to see the various steps that are moving our industry forward.