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PAC: Raw Material, Package Machinery & Ancillary - Bronze

Spot-Pak Package

Overview

Delkor's Spot-Pak package is an alternative to packaging products into dairy cases or traditional RSC boxes for customers in the dairy industry. It can be produced using recycled corrugate and can be recycled again. The Spot-Pak package provides substantial reduction in secondary packaging materials which cuts costs, reduces dry storage requirements, and lowers transportation costs through increased cube utilization. At the retail level, it reduces labour associated with package removal, reduces costs associated with corrugate disposal and reduces material sent to landfills.

Motivation for Change

Many of Delkor’s customers in the dairy industry were looking for an alternative to packaging their products into dairy cases or traditional RSC boxes. Delkor’s Spot-Pak® package is a result of assessing their needs and developing a solution that successfully meets those needs.

Cost Effectiveness

The Spot-Pak package saves up to 75% in the cost of secondary packaging material. Freight costs are reduced 8% - 12% due to increased pallet density. Dry storage costs and inbound freight are reduced substantially due to the reduction of secondary packaging inventory. One unit or pallet of corrugated Spot-Pak pads equals six units or pallets of standard RSC cases. The elimination of the corrugated around the perimeter of the package often provides for an additional case on each layer of the pallet. This improvement of cube utilization reduces freight costs on average of 8%. The typical 50% reduction in corrugated also translates into substantial reduction in dry storage. This reduction of secondary packaging inventory is usually 6:1 units or pallets when comparing the Spot-Pak pads to RSC blanks.

The Spot-Pak package provides a solid shipping unit that provides increased protection of the primary container. The temporary bond adhesive creates a lug that the base container resides. This lug reduces movement of the containers through distribution channel resulting in fewer defects or unsalable product.

Substantiation: With over 150 lines installed throughout Canada and the United States Delkor’s customers are making an impressive change to the environment:

•Reduced corrugated usage by 1.5 billion board feet per year. Assuming a cost of $0.06 per board foot. The savings totals $ 90,000,000.

•The cost to transport an equivalent amount of corrugated requires about 6,000 trucks per year. Assuming an average truckload cost of $300, the estimated cost saving in transportation is $1,800,000.

•By decreasing the package size, and increasing pallet density 8 to 10%, our customers are using 6,000 fewer truckloads per year to ship product to market. The estimated cost savings in distribution transportation is $1,800,000.

•The total savings that Delkor customers are experiencing add up to an impressive $93,600,000 per year.

Sourcing

The Spot-Pak package can be produced using recycled corrugated and can be recycled again. Almost 90% of the fibre in a Canadian-made corrugated comes from recycled boxes and/or chips, shavings and sawdust from logging and wood processing operations. Only 13% is actually made from logs.

Effective Recovery

Secondary waste is reduced by as much as 75% compared to traditional RCS cases. This reduction minimizes the handling at the retail level. Both the corrugated and the poly can easily re-enter the recyclable stream.

Resource & Energy Optimization

Reduced corrugated usage by 1.5 billion board feet per year. By decreasing the package size, and increasing pallet density 8 to 10%, our customers are using 6,000 fewer truckloads per year to ship product to market. With the reduction of secondary packaging materials, the reduction of dry storage requirements, lower transportation cost through increased cube utilization, and the reduction of secondary waste at the retail level, the Spot-Pak package addresses sustainability on many levels. Transportation of the source material to the production facility is reduced substantially due to the reduction of as much as 75% of the material required to make the package.

Categories: PAC Award Winner Machinery Food and Beverage

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