TRENDS IN RETAIL PACKAGING

ISHAK ABDUL RAHIM,

CHEP MALAYSIA

12TH ECR ASIA PACIFIC CONFERENCE

OCTOBER 5, 2010

ECR KL, OCT 4 2010 CROWNE PLAZA HOTEL2

AGENDA

� THE IMPORTANCE OF RETAIL READY PACKAGING (RRP)

� INDUSTRY BENEFITS

� AGENTS OF CHANGE

� THE DRIVERS

� ENVIRONMENTAL FACTORS

� CURRENT TRENDS OF RRP

� IMPACT OF RRP

� INNOVATIONS IN RRP - ONE TOUCH REPLENISHMENT SOLUTIONS

� SUPPLY CHAIN STUDY : BEVERAGE INDUSTRY

� BEVERAGE TRAYS SUPPLY CHAIN

� CHEP’S ROLE

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THE IMPORTANCE OF RETAIL READY PACKAGING (RRP)

� First point of contact by which a company presents its products to consumers.

� Innovation in designs and colours as brands push for shelf appeal and space.

� Improved identification, recognition, direct case to shelf replenishment.

� The introduction of One Touch replenishment helps get the right product to the right place for shelf replenishment

Source: www.sustainpack.com

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INDUSTRY BENEFITS

% of

respondents

Source: IGD. Global RRP. IGD’s guide to building your response. August 2010

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THE DRIVERS

Electronic business processes

Supply chain management

Convenience packaging

Marketability Packaging for ageing populations

Other demands

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ENVIRONMENTAL FACTORS

Source: Australian Packaging issues and trends adapted from Packaging Council of Australia, issues # 18, 2005

Consumers – High awareness on the credentials of the products, brands and the companies they buy from.

Commercial factors - supply chain plays a leading role. Example - polystyrene boxes are banned and no longer acceptable in some developed countries

Governments –Europe and Australia have targeted packaging for environmental legislation. Example - container deposits, packaging levies, bans on certain types of packaging and imposing recycling rates

Recycling - recycling will benefit financial and environmental costs.

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CURRENT TRENDS OF RRP

Source: Global retail ready packaging, IGD, 2010

Shelf Ready

Typically corrugated tray

which sits directly onto the

shelf

Easy to change categories

Display Ready

Easily Movable

Most commonly used for

promotional products or short

term display

Infrastructure Ready

Infrastructure modifications are

required at certain levels

High Volumes, Fast moving

items

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IMPACT OF RRP

Source: IGD. Global RRP. IGD’s guide to building your response. August 2010

% of respondents

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CONSIDERATIONS

Emitter ConsumersWarehousing Transporter Retailers

Retail Ready Packaging

Supplier led considerations Retailers led considerations

Review Basic

Principles

Supply Chain

Efficiencies

Cost

Models

Measure

Performance

- Compliance

- Avoid

fragmentation

- Avoid complexity

- Implementation

- Measurement

- Safety compliance

- Total supply chain

benefits

- Robustness to

move along supply

chain handling

platforms

- Overall cost impact

- Pallets utilisation,

storage, transport,

shelf space

utilisation, labour,

- CAPEX, total

packaging costs &

environment

- In store costs

- In store

acceptance

- Supply chain costs

- Sales volumes

- Replenishment

time

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WHAT DO RETAILERS AND SUPPLIERS WANT?

Retailers Suppliers

Shelf availability and volumesEquitable distribution of productivity,

benefits and cost savings

Innovative, creative and consistency in developing solutions

Sharing data of RRP implementations

Shoppers Oriented Solutions Develop industry standards

Improved collaboration

Improved communication

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BARRIERS TO IMPLEMENTATION

% of respondents

Source: IGD. Global RRP. IGD’s guide to building your response. August 2010

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INNOVATIONS IN RRP - ONE TOUCH REPLENISHMENT SOLUTIONS

Rolling Solutions

Example: Wheeled pallets in Tesco UK that can

be a pallet or a dolly at any point in the supply

chain and will replace semi pallet and existing

dollies.

Delivery Trays

Example: Beverage trays on dolly or pallet

provides optimum display effect & efficient

handling throughout the supply chain.

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BEVERAGE SUPPLY CHAIN STUDY

� Study Thailand and Malaysia end to end supply chain of MNC in carbonated drinks and beer segment

� 80% of beverage segment leaders were interviewed.

� Key Findings:

- One-way packaging are common

- Lack of standardisation in platforms

- Don’t look at supply chain flow as whole.

- Environmental awareness is low

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BEVERAGE TRAYS SUPPLY CHAIN

TRAY, DOLLY & PALLET INDUCTION STATIONS AUTOMATED PACKING LINE

ASRS WAREHOUSING & DISTRIBUTION RETURN OF EMPTY BOTTLES IN TRAYS

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CHEP BEVERAGE TRAYS BENEFITS

Benefits

� Helps reduce total costs

� Optimum display effect

� Efficient handling

� Excellent stability

� One touch merchandising

� Eliminate cardboard waste

� Reduce repacking / unpacking time.

� Improve brand positioning

� Reduce import duty and tax cost.

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CHEP’S ROLE

� Focus on Reduce, Reuse, Recycle.

� Innovation based on a convergence of packaging needs

- the gap between product protection and

portability, cost efficiency, sustainability.

- solutions that provide speed to shelf, less

waste and safer handling.

� Create industry pool and standardize.

� Examples

- Returnable plastic containers

- Returnable beverage trays

- Returnable shelf ready packaging (SRP)

- Returnable display pallets.

THANK YOU