Measuring reusable packaging performance in omni-channel networks

This is an excerpt of the original article. It was written for the May-June 2022 edition of Supply Chain Management Review. The full article is available to current subscribers.

May-June 2022

I recently returned from three days in Atlanta at the Modex trade show. Although advertised as a supply chain event, it’s really a materials handling automation show with a handful of logistics providers thrown in for good measure. Heading out the door to the airport, I had no idea what to expect. The two-year absence from the trade show and conference scene had me, and many of the individuals I spoke to before the show opened, wondering what’s next—not just for the show but for operations in general. If the turnout and the enthusiasm is any indication, I think supply chain is in pretty good shape these days, despite the disruptions we’ve…

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Omni-channel supply chains in the retail industry have evolved rapidly over recent years in response to shifting consumer demands. At the same time, the shift toward circular economies is gaining momentum as countries and companies set increasingly ambitious sustainability goals. How can omni-channel support the development of circular supply chains?

One way is to create reverse flow channels that collect returned product and packaging for recycling and reuse. The retail industry is actively developing these reverse supply chains, but one of the challenges they face is how to measure the impact of reuse strategies on omni-channel operations.

Research underway at the MIT Center for Transportation & Logistics’ Circular Supply Chain initiative highlights the importance of establishing key metrics to the future success of reusable packaging strategies in retail. A case study in the grocery business reveals the effectiveness of packaging return systems in improving sustainability performance and the implications for the efficiency of omni-channel retail networks.

Grocery retailer study

Reusable packaging is a vital component of sustainable supply chains. Product packaging uses huge quantities of material resources and is a significant source of municipal and industrial solid waste. For example, it is estimated that in Europe packaging uses 40% of plastics and 50% of paper while contributing 36% of solid municipal waste. Reuse is an obvious way to mitigate this waste, yet most packaging is designed to be disposed of after a single use.

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