Driving Efficiencies

One might imagine that a manufacturing and packaging company with 55,000 employees has its hands in more than a few disciplines. Georgia-Pacific, headquartered in Atlanta, is a company that has extended its core manufacturing capabilities into service and production industries. Known as a leading manufacturer and marketer of tissue, packaging, paper, pulp, and building products, Georgia-Pacific also has expanded its business services arms in recent years to become a powerhouse of packaging efficiency.

Two business arms in particular are driving packaging innovations-the Innovation Institute in Atlanta and the Color-Box subsidiary. Georgia-Pacific’s Innovation Institute (www.gpinnovates.com) is a creative, collaborative environment where Georgia-Pacific and customers identify and reduce supply chain costs, increase shelf impact, and measure sustainability factors. The Innovation Institute simulates retail and packaging environments to help CPGs and other clients maximize the full value of their packaging investment.

Color-Box (www.gp.com/packaging/colorbox) is a Georgia-Pacific division also focused on the entire supply chain from the manufacturer all the way to the consumer. Consumer preferences are paramount as designers try to stay flexible while creating packages that meet the needs of different retail channels. Color-Box benefits from Georgia-Pacific’s deep experience with operational efficiency and their wide-range of board combinations and flute sizes.

Patrick Smorch, manager, packaging technology at Georgia-Pacific’s Innovation Institute, explains how primary packaging impacts secondary packaging and vice versa. Often, the discussion starts with cost savings and develops into an innovative way to accomplish more with less. Sometimes the strength of primary packaging can be increased structurally so less secondary packaging is required. Depending on the design project, Smorch says the opposite might be the better option to reduce overall production and supply chain costs while increasing sustainability goals.

“Cost savings translates pretty well into sustainability benefits,” emphasizes Brian Reilly, senior director of the Innovation Institute. Georgia-Pacific studies the whole packaging picture to develop the best solution for each project that addresses billboarding potential, structural advantages, production efficiencies, shipping costs, pallet strategies, retail impact, reduction of materials, and so on.

In essence, all the factors involved in package design are business interests that can be aligned to achieve one goal. “They’re all very much linked together,” says Smorch. Georgia-Pacific and its divisions also benefit from being both a manufacturer and a CPG company that produces many common household brands such as Quilted Northern, Angel Soft, Brawny, Sparkle, Vanity Fair, and Dixie. They believe that they are uniquely qualified to understand how each factor affects the other to reach the most efficient solution that also yields the best retail package design.

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Color-Box in action

The Color-Box division is a full-service package design company and the only litho-laminate company with nationwide coverage. It has the equipment to litho-laminate up to six colors with 150-200 line screen, preprint up to seven colors with 150 line screen, and direct print up to six colors with 85 line screen. Some recent case studies showcase its design and innovation capabilities.

The LEGO Mindstorms toy package was developed with a three-piece box with a tip-lid displaying real-life graphics that depict the high quality image the LEGO Group wanted to project. To emphasize the printing, a special high quality bright paper was used with UV/matte varnish coating to convey the eye-catching images. The box stands out on the shelves and explains the quality product inside the package. The package specifications included: tip-lid-folding carton; top-folding carton; bottom-micro-flute; four-color; and UV coating.

General Electric launched its Nighthawk Blue-White Light Automotive Headlamps with packaging by Color-Box. The box was specially designed for younger consumers with the die-cut head of a hawk while protecting the delicate headlamps from damage during transport.

“Like all good package designs, we set out to provide a design that balances form and function,” says Tony Paterini, sales representative at Color-Box. To enhance package shelf appeal, Color-Box selected four-color printing and aqueous coating with holographic silver foil stamping. The metallic finish reflects and illuminates light, supporting the headlamp theme and differentiating the product from the competition.

By eliminating the need for an insert, this structural design gave General Electric the necessary package stability while reducing raw materials and related costs. The corrugated package is also strong enough to eliminate the need for an over-pack when stacked and shipped on a pallet, further reducing material and handling costs.

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Dixie’s PerfecTouch Grab N Go insulated 12-oz. paper cups recently received a unique package design from Color-Box. Aimed at driving sales of the popular insulated cup during the holidays and year long, the packaging holds 14 cups and lids in an easy-to-carry and easy-to-store shrink-wrapped box and is available at retail outlets around the country.

PerfecTouch is Georgia-Pacific’s patented paper cup for hot beverages. It features a non-slip grip, double-insulated wall and snap-on dome lid to help secure hot beverages safely in the consumer’s hand. “Color-Box has created an integrated package design concept and production program to support our global promotional strategies,” says Fernando Gonzalez, vice president, retail marketing, Dixie.

Paper cups are traditionally packaged in large quantities in polyurethane bags. The Color-Box package design allows for better placement of the cups on store shelves and better storage on consumers’ pantry shelves. The carton itself acts as an excellent canvas for a variety of designs as well as communicating the product’s benefits to the consumer.

PSO in action

Georgia-Pacific’s Packaging Systems Optimization (PSO®) program, born at the Innovation Institute, uses a thorough five-step process to examine the efficiency of a company’s packaging supply chain and quickly offer results that can increase profitability and sustainability. The cost models are thorough studies of all materials and activities costs that are involved in packaging production and shipping.

Last month, Georgia-Pacific launched its PSO microsite (www.gppso.com) that highlights the company’s program to help customers reduce total packaging costs while achieving greater sustainability with a short lead time. A PSO Calculator on the site quickly estimates potential sustainability improvements from simple input values. The PSO Calculator then estimates potential savings in terms of raw material cost, energy consumption and greenhouse gas emissions (GHG).

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The PSO process includes a Total Cost Analysis (TCA®) tool that quantifies supply chain savings and measures sustainability impacts, including fiber and energy use and greenhouse gas emissions. For each PSO project a team of Georgia-Pacific engineers and experts assesses a customer’s supply chain, including package design, material optimization, shelf impact, and SKU consolidation, as well as line productivity, material handling and distribution.

For more on PSO, see the accompanying Q&A (page 40) with Brian Reilly. Two recent case studies showing innovations of the PSO process are outlined here-the development of Greenshield® produce boxes and the dramatic reduction of shipping materials for A.O. Smith Water Products Company.

Georgia-Pacific noticed that major retailers have specified that they no longer want products delivered in non-recyclable waxed boxes. Perishable food companies, primarily meat, poultry and seafood processors, as well as growers and shippers in the produce segment, challenged the corrugated industry to develop recyclable corrugated boxes to meet these demands.

The team at the Innovation Institute applied the 5-step PSO process and led the development and testing of a proprietary coating technology that offers structural integrity and outstanding performance while providing a recyclable solution not available with most waxed packaging products.

Greenshield® delivers 100% recyclability, tested strength, and cost benefits to the supply chain through Old Corrugated Containers (OCC) revenue. With Greenshield, customers are able to respond to retailer’s demands and differentiate themselves in the market at a competitive cost.

Over the last year, Georgia-Pacific has tested this solution in the poultry industry and shipped more than three million pounds of deli chicken successfully. The Innovation Institute is completing its final tests to validate Greenshield’s family of recyclable corrugated solutions for seafood and various produce commodities, such as celery, peaches, grapes, and squash.

As part of its PSO recommendations for water heater manufacturer A. O. Smith Corporation, Georgia-Pacific’s engineering experts assessed the company’s supply chain and developed a comprehensive plan to reduce fiber content, energy use, and transportation costs while significantly increasing productivity. In less than a year of PSO implementation, A.O. Smith saw a substantial reduction in total packaging systems costs.

The Georgia-Pacific team radically redesigned the locator base, the foundation of the box that secures the heater in place. The team also streamlined A.O. Smith’s assembly process by eliminating the need to fold locators, and reduced storage requirements as a result of the locator base redesign. The new design combined two pieces of corrugated laminated together and a plastic clip, which allows for proper nesting, provides impact resistance, and offers more vertical height for securing the heaters in the boxes.

The redesign reduced the amount of corrugated used to form the locator by one-third. This cost savings was partially reinvested into plastic clips used to keep the water heater firmly in place. Now the box flaps fit tighter to the locators, protecting product from damage during transit. And with a smaller footprint, the corrugated carton is easier to store in the warehouse and allows for a greater number to be placed on each truck, streamlining logistics, and reducing greenhouse gas emissions with fewer trucks on the road.

Q&A: Profitability and Sustainability Are No Longer Mutually Exclusive

In today’s rapidly changing retailer landscape, suppliers must meet retailers’ new sustainability requirements while remaining cost-competitive. By optimizing packaging operations, suppliers can deliver profitability and sustainability at the same time. Brian Reilly, senior director at Georgia-Pacific’s Innovation Institute, answers specific questions about changes in the consumer products industry and how the company’s Packaging Systems Optimization program can help suppliers adapt to a dynamic retail environment.

What changes have you seen in the consumer packaged goods (CPG) industry over the last few years?

Reilly: Large retailers are transforming the way CPG companies do business today. CPG companies face intense pressure: retail channels have blurred; there’s a fierce battle for shelf space; CPG companies must hold prices down while maintaining margins and delivering sustainable products.

What is PSO and how does it help CPG companies adapt to the changing retail landscape?

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Reilly: Packaging Systems Optimization is a system-wide analysis that uses a rigorous, five-step process to improve the efficiency of a company’s packaging supply chain. Performed by a team of Georgia-Pacific Packaging experts and engineers, PSO optimizes nine areas of the supply chain including package design, material usage, shelf impact, SKU consolidation, line productivity, material handling and distribution. By creating highly efficient packaging supply chains, the program delivers cost-savings and profitability, while achieving sustainability goals.

How does PSO measure cost-savings and sustainability?

Reilly: Within three weeks of an initial assessment, the team delivers a PSO Report, which includes a detailed analysis and quantification of potential supply chain savings. These savings are then translated into sustainability metrics, such as reduced fiber content (tons), reduced energy consumption (BTUs) and reduced greenhouse gas (GHG) emissions. Even small changes to a corrugated box design can result in significant system-wide cost reductions and environmental benefits. Our customers have found that operating in a sustainable manner actually helps them achieve greater profitability.

What makes PSO unique?

Reilly: PSO examines all packaging materials and processes from our customer’s packaging line, to distribution, and ultimately to the retail store. Georgia-Pacific’s PSO engineers drill down on every aspect of package performance to uncover hidden sources of inefficiency and waste related to warehousing, cube utilization, automation, and unitizing.

Georgia-Pacific is more than a packaging company; Georgia-Pacific is also a CPG company. This provides us with a unique understanding of retailer needs, as well as customers’ packaging operations and how to optimize them. The Packaging Systems Optimization program is also distinguished by its well-defined five-phase process, which provides a structured approach to help companies realize their profitability and sustainability goals.