Waste reduction of returnable packaging:

Waste reduction of returnable packaging:
A case study of reverse logistics in an auto parts company Issued by Nophanut Katephap Sunpasit Limnararat Faculty of Engineering King Mongkut’s Institute of Technology Ladkrabang

Summary of topics I. Introduction II. Methodology III. Results IV. Conclusion V. Further study

I. Introduction Environmental problems have been hotly discussed among the government, businesses and society. Thus, companies should develop their image by changing their process. A suitable method to reach the environmental development in reverse logistics has received increasing consideration due to competitiveness reasons, environmental requirements and marketing.

I. Introduction Nowadays industrial packaging has still been considered on disposable packaging which big and varied quantities of waste but returnable packaging can reduce wastes, resource consumption and save cost. Based on current demand, studies on reverse logistics with focus on the industrial packaging activity stand out.

I. Introduction Examples of relevant publications on reverse logistics with emphasis on industrial packaging : D. J. Adlmaier & M.A. Sellitto suggested the benefits from replacement of disposable packaging with a returnable packaging by reducing resource consumption and operational costs.

I. Introduction Most activity of reverse logistics is cost reduction between 2 countries by changing from disposable packaging to returnable packaging in term of “Single trip”. X exports “product + returnable packaging” to Y, after Y unpacking, Y would return “emptied packaging” to X but if Y has to export to X, Y needs to buy new packaging.

I. Introduction Hence, this research proposes a study on “Round trip”. X exports “product + returnable packaging” to Y, after Y unpacking, Y would not return “emptied packaging” to X same as Single trip but Y can use returnable packaging from X to export to X. Therefore, Y does not need to buy new packaging. Thus packaging cost can be reduced.

I. Introduction This research presents a case study of reverse logistics of returnable packaging used to transport auto parts among 3 countries located in Thailand, Vietnam and the Philippines in replacement for its usual disposable packaging including Single trip and Round trip. Therefore, a cost reducing analysis was conducted expecting to prove that the reverse logistics with returnable packaging can get benefits that contribute to the sustainable development of the company.

II. Methodology 1. Overall data collection Export costs The results show that packaging is the highest cost. Hence, this cost would be taken further studies.

II. Methodology 1. Overall data collection Packaging cost The results show that metallic rack is the highest cost. Hence, metallic rack would be taken further studies.

II. Methodology 1. Overall data collection Dimension and ratio of metallic rack The results show that S1 metallic rack is the highest ratio. Hence, this type would be taken further studies. *Remark S1 = 1,490x2,250x730 mm. S2 = 1,490x2,250x1,460 mm. S4 = 1,490x2,250x1,095 mm.

II. Methodology 1. Overall data collection Therefore, this research focusing only on S1 metallic rack of packaging cost of export costs due to this packaging is the highest ratio and the highest cost. Export costs Packaging cost Ratio of metallic rack

II. Methodology 2. Technical data collection
Volume of S1 metallic rack Exporter Importer Volume (Pieces/Year) Thailand The Philippines 39,324 7,800 Vietnam 96,216 1,152 3,960 84 Total 148,536

II. Methodology 2. Technical data collection Concept of disposable packaging Materials used in the disposable packaging. Material Lifetime (Trip) Usage Unit S1 metallic rack (disposable) 1 Piece Carton pad 4 Pieces Kola tape 5 Meters Paper label

II. Methodology 2. Technical data collection Concept of disposable packaging The assembly steps of the disposable packaging.

II. Methodology 2. Technical data collection Concept of disposable packaging The assembly steps - Carton pads are used to prevent sliding boxes of auto parts from the S1 metallic rack. - The use of kola tape to hold the carton pads to side panel of S1 metallic rack. - Boxes of auto parts are arranged one by one. - The paper label is attached for export.

II. Methodology 2. Technical data collection Concept of returnable packaging Only S1 metallic rack was developed from disposable to returnable packaging in order to reduce inventory management of various types of packaging, the concept was described as follows: - Dimension was same as current disposable packaging to hold all of auto parts in a 40 foot export container.

II. Methodology 2. Technical data collection Concept of returnable packaging - The strength of structure was improved to extend lifetime of packaging. - Steel plates were added at the side panel of S1 metallic rack instead of carton pads to prevent sliding boxes of auto parts. - Carton pads and kola tape were not required. - The packaging was painted to prevent rust.

II. Methodology 2. Technical data collection Concept of returnable packaging Materials used in the returnable packaging. Material Lifetime (Trips) Usage Unit S1 metallic rack (returnable) 36 1 Piece Paper label

II. Methodology 2. Technical data collection Concept of returnable packaging The assembly steps of the returnable packaging.

II. Methodology 2. Technical data collection Concept of returnable packaging The assembly steps - Boxes of auto parts are arranged one by one. - The paper label is attached for export.

II. Methodology 3. Logistics data collection Concept of disposable packaging *Remark TH: Thailand PH: The Philippines VN: Vietnam D: Exported with disposable packaging (pieces/year) R: Exported with returnable packaging (pieces/year) : Products + packaging : Emptied packaging

Export Volume (Pieces/Year)
II. Methodology 3. Logistics data collection Concept of disposable packaging Thus, concept of disposable packaging needs to buy disposable packaging 39,324+96,216=135,540 Exporter Importer Packaging source Export Volume (Pieces/Year) By disposable By returnable Total TH-PH New order 39,324 PH-TH TH 7,800 TH-VN 96,216 VN-TH 1,152 PH-VN 3,960 VN-PH 84 148,536

II. Methodology 3. Logistics data collection Concept of returnable packaging (Single trip) *Remark TH: Thailand PH: The Philippines VN: Vietnam D: Exported with disposable packaging (pieces/year) R: Exported with returnable packaging (pieces/year) : Products + packaging : Emptied packaging

II. Methodology 3. Logistics data collection Concept of returnable packaging (Single trip) Need disposable packaging 15,288+1,607=16,895. Exporter Importer Packaging source Export Volume (Pieces/Year) By disposable By returnable Total TH-PH New order 15,288 24,036 39,324 PH-TH TH 7,800 TH-VN 1,607 94,609 96,216 VN-TH 1,152 PH-VN 3,960 VN-PH 84 29,891 118,645 148,536

II. Methodology 3. Logistics data collection Concept of returnable packaging (Round trip) *Remark TH: Thailand PH: The Philippines VN: Vietnam D: Exported with disposable packaging (pieces/year) R: Exported with returnable packaging (pieces/year) : Products + packaging : Emptied packaging

II. Methodology 3. Logistics data collection Concept of returnable packaging (Round trip) Need disposable packaging 5, =5,258. Exporter Importer Packaging source Export Volume (Pieces/Year) By disposable By returnable Total TH-PH New order 5,148 34,176 39,324 PH-TH TH 7,800 TH-VN 110 96,106 96,216 VN-TH 1,152 PH-VN 3,960 VN-PH 84 9,302 139,234 148,536

II. Methodology 3. Logistics data collection Returning conditions of the rest of returnable packaging (emptied packaging) To maximize capacity of 40 foot container, emptied packaging must be collected until complete 128 pieces before shipping.

II. Methodology 4. Packaging waste calculation Before improvement - Exported with disposable packaging. After improvement - Exported with returnable packaging (Single trip) - Exported with returnable packaging (Round trip)

Packaging volume (Pieces/Year)
III. Results 1. Packaging volume calculation After improvement, Returnable packaging (Round trip) is the lowest usage of disposal packaging or highest usage of returnable packaging. Concept Packaging volume (Pieces/Year) Disposable Returnable Total Before improvement Disposable packaging 135,540 After improvement Returnable packaging (Single trip) 16,895 118,645 Returnable packaging (Round trip) 5,258 130,282

Packaging waste (Kilograms/Year)
III. Results 2. Packaging waste calculation After improvement, Returnable packaging (Round trip) is the lowest waste. Waste reduction [(7,454,700-2,569,125) / 7,454,700] x 100 = 65 % Concept Packaging waste (Kilograms/Year) Disposable Returnable Total Before improvement Disposable packaging 7,454,700 After improvement Returnable packaging (Single trip) 929,225 2,076,288 3,005,513 Returnable packaging (Round trip) 289,190 2,279,935 2,569,125

IV. Conclusion We presents a case study of reverse logistics of returnable packaging used to transport auto parts among 3 countries in replacement for its usual disposable packaging including concept of Single trip and Round trip. Therefore, a waste reducing analysis was calculated, the result shows that returnable packaging by concept of Round trip is the best option, can reduce waste 65% that contribute to the sustainable development of the company.

V. Further study

V. Further study Further study discusses a study on “Multi trip”. Multi trip is X export “product + returnable packaging” to Y & Z, after Y & Z unpacking, Y & Z would not return “emptied packaging” to X same as Single trip but Y can use returnable packaging from X to export to X & Z, Z can use returnable packaging from X to export to X & Y.

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Waste reduction of returnable packaging:

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