As we brace for an exceptionally busy e-commerce holiday shopping season, Jeff
Chalovich, Chief Commercial Officer and president of Corrugated Packaging at
WestRock, discusses how the fiber-based packaging solutions company is helping
its customers fulfill orders not only swiftly, but sustainably.
Here in the US, we love coining words that take the seemingly mundane to the
next, terrifying level (hello, “snowpocalypse”). And, in keeping with this trend
— as we slide into a unique holiday season, thanks to
COVID — people across
the country are bracing for “shipageddon.”
Coined by Scott
Silverman
of Retail Geek, shipageddon refers to the anticipated delivery delays that
parcel companies such as FedEx and
UPS will be facing with the
significant surge in holiday packages shipping this year.
But the broad-reaching implications of shipageddon extend far beyond the moment
when the glut of holidays packages are en route. How are consumer packaging
goods companies prepared to fulfill the surge in orders? And, how are packaging
companies designing both product and corrugated shipping boxes in a manner that
ensures the product’s safety and the planet’s longevity? Shipageddon doesn’t
just raise concerns about deliverability; it raises concerns about
sustainability.
At WestRock, an
Atlanta-based fiber-based packaging solutions company (and one of North
America’s largest recycling networks), we’ve been pondering how we can help
customers skirt delivery disaster and minimize the havoc shipageddon might wreak
in terms of supply and demand. How are we helping our customers fulfill orders
not only swiftly but sustainably? Quite simply: by continuing our focus on
Connecting People to Products safely
and sustainably with solutions that are right-sized, renewable, recyclable and
compostable.
The challenge: exponential e-commerce growth
For the 2020 holiday season, people aren’t doing the bulk of their shopping on
Main Street, but rather online. In fact, according to Accenture, 75 percent
of
consumers
plan to shop online for at least some of their holiday
gifts
(up a whopping 65 percent from last year); and a little less than half plan to
do all of their holiday shopping online. Fueled by our pivot to online purchases
during the pandemic, consumers have cozied up more quickly than expected to
e-commerce.
The look ahead coming out of Deloitte's annual holiday retail
forecast?
E-commerce sales will grow by 25-35 percent year-over-year during the 2020-2021
holiday season. And Adobe Analytics predicts that online sales this month
will surge 33 percent year-over-year, to a record $189 billion.
In short, the expected e-commerce growth is unexpected, unparalleled and
exponential.
All told, the reality is that, since many Black
Friday
deals went digital and launched well in advance of Thanksgiving, shipageddon set
sail weeks ago. Thankfully, we and our customers were equipped with automated
packaging solutions, which meant we were also equipped to swiftly and
sustainably handle the surge.
The solution: speed, efficiency and sustainability — on demand
COVID-19’s impact on supply chain demands across the industry prompted leaders
to embrace newly improved and highly efficient practices of business management.
WestRock’s adoption of a “just-in-case” — rather than the familiar,
“just-in-time” model — pushed us to lead in the e-commerce world and optimize
our internal structure to prioritize and meet the needs of the customer.
The secret to a successful, sustainable e-commerce business is a resilient, yet
nimble supply chain — prioritizing efficiency and sustainability via automated
packaging solutions. Our
customers came to us with a challenge: Help us reduce or eliminate void fill and
reduce our overall packaging and shipping costs. Our right-sizing solutions not
only solve those challenges, but they also provide our customers with a more
sustainable package.
Customers often report that on-demand packaging systems improve their labor and
factory logistics, too. Many customers report an increase in the number of
direct-to-consumer shipments per day, reduction of floor space from stored
corrugated boxes and cost savings from decreased waste — all of which help our
customers win in e-commerce.
Sustainable from beginning to new beginning: contributing to a circular economy
Optimizing our supply chain to incorporate local forestry suppliers and
recycling practices is vital to WestRock’s commitment to advancing a circular
economy, and a key component of prioritizing a sustainable future.
Recycling existing products is an important step in WestRock’s process; and as
one of the nation’s largest integrated recyclers, we bring a level of fiber
expertise to the process that few companies can match. Once materials are
collected for recycling, WestRock processes and recycles the fiber (fiber can be
recycled 5-7 times) and puts it back into the manufacturing process, along with
virgin fiber. Leveraging 18 recycling plants across the US, WestRock recycles 8
million tons of materials per year — exceeding our 5.5 million tons of recycled
fiber consumption. Prioritizing connectivity in our core set of values, we also
work to increase awareness of recyclability and educate consumers, alongside
partners such as The Recycling Partnership.
In 2019, to help dispel the myth that corrugated pizza boxes are not recyclable,
WestRock commissioned a study of
the availability of pizza-box recycling programs in the US; we then
conducted a subsequent study that concluded
normal amounts of grease and residual cheese do not negatively affect
manufacturing of new product from this recycled fiber. To further encourage
pizza lovers to learn more — we launched a hub of
information about proper pizza box recycling —
in partnership with Domino’s.
When we consider how many boxes are heading out into the world these days — both
of the shipping and the
pizza
varieties — prioritizing planet alongside production is key. WestRock is aiming to help companies battle — rather than brace for — shipageddon by streamlining their systems for greater efficiency and greater
sustainability.
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Chief Commercial Officer and President, Corrugated Packaging
WestRock
Published Dec 7, 2020 1pm EST / 10am PST / 6pm GMT / 7pm CET