1. Your Plastics Sustainability Plan suddenly went out the window the 1st time you got Walloped! De-risking is important if you’re building a long term sustainable plastic supply chain…by gearedforgreen April 29, 2018 cardboard box reuse circular supply chain decoating technology eco apparel eco brand marketing eco supply chain gearedforgreen plastic raw materials plastic recycling plastic resins recycling social partnerships sustainable packaging sustainableshopping
When it comes to sustainable plastics initiatives, there are many risks to deal with, from long term repeatable supply of sustainable plastic raw materials – to – consistent long term recycling markets for your own plastic scrap. Starting-stopping-pivoting is challenging. A connected, collaborative and transparent eco supply chain will help mitigate risk so you don’t have to.
Here are some suggestions to help you De-risk.
WHEN IT COMES TO DE-RISKING YOUR RECYCLED PLASTIC RAW MATERIAL SUPPLY CHAIN, WE RECOMMEND DIGGING A LITTLE DEEPER FOCUSING ON THESE (3) STRATEGIES
1. Go Direct to De-risk Raw Material Resin Quality & Repeatability
Some resin suppliers are actual resin producers themselves, others are agencies / distributors, each providing unique expertise and resources. Since recycled plastic resins have more challenging quality nuances versus prime resins, it’s important to keep a close watch on repeatable quality. Raw material quality can impact the integrity of your product and more so, the value of your brand. So when it comes to De-risking your Sustainable plastic raw material quality, we highly recommend working direct with your resin producers. It’s more than price per pound! A direct relationship enables you to form close “technical relationships” between resin producer-resin user with mutual site visits and continual improvement processes. You should visit every facility making your recycled plastic resins to see their operations, on site lab, quality control testing regiment, inventory capability, and to meet the floor team first hand. And you should require your resin supplier to also visit your manufacturing operations too, to better understand your products, equipment, internal logistics, and team. Remember.. when using recycled plastic resins, technical relationships really matter! The more your resin producer knows about your specific product, your equipment, your process, your floor personnel.. the better you can both formulate solutions that help lower your total cost of manufacturing and maximize performance.
2. Dig Deeper to trace your Ingredients. That’ll further De-risk Raw Material Quality & Availability
When it comes to using sustainable recycled plastic resins, it’s important to not only know the ingredients used to make your recycled resins, you should also know the entire supply chain used to make your recycled plastic resins. A transparent connected eco supply chain will help De-risk your sustainable raw material supply. Important Questions you should ask your resin supplier… Does the plastic scrap come from consumer or industrial sources? Have you seen the actual plastic scrap prior to recycling, that’s used to make your resins? What contaminates are found in the scrap supply? Is the raw material certified and trackable through the supply chain? Has the carbon footprint been measured to confirm how sustainable the resin actually is? Does it come from one source that may not be reliable long term, from constantly changing sources, or from many sources that are diversified? What if that one source dries up? Is the raw material source dependable long term? What is the relationship between your resin supplier and their sources of plastic scrap? These are among the important questions you need to answer about your resin supplier and their plastic scrap supply chain in order to De-risk your raw material sourcing initiatives.
3. Implement Indexed Pricing to De-risk Price Volatility and Lock-in Relationships
Maintaining long term consistent raw material plastic resin supply is important to both manufacturers and suppliers. However, that gets challenging as market prices fluctuate over time. Establishing a Price Index model that sets prices up and down over market fluctuations can be a great tool to De-risk price volatility. Plastic Resin Manufacturers that buy resins can establish pricing based on indexes such as CMAI. This approach De-risks price fluctuation in case your raw material supplier disproportionately increases pricing? When the supply chain Indexes Together, including the actual sources of plastic scrap… even better!
WHEN IT COMES TO DE-RISKING YOUR PLASTIC RECYCLING INITIATIVES, YOU NEED TO MAKE SURE YOU HAVE LONG TERM SECURE MARKETS FOR THE PLASTIC SCRAP THAT MEET YOUR UNIQUE REQUIREMENTS. WE RECOMMEND YOU FOCUS ON THESE (3) STRATEGIES TO DE-RISK YOUR PLASTIC RECYCLING EFFORTS
1. Diversify & Deepen your customer base to De-risk against long term Market bubbles
For those investing money in the stock market, it’s generally a good practice to diversify your portfolio. Same holds true when developing markets for your plastic scrap. By design, it’s a very good idea to have multiple customers supplying into multiple industry sectors, thus diversifying and De-risking your markets. Anyone who’s been involved in plastic recycling for long periods of time knows… plastic scrap markets change, shift, even dry up entirely. Look what recently happened to the China market! Starting a large scale plastic recycling program is hard enough. The last thing you want to worry about is not having available markets to sell the plastic scrap you collect. De-risking against market reliability can be achieved in a couple of ways.
You can develop multiple diversified customers in different markets to buy your scrap, however juggling like that can have its own challenges.
Or you can connect in circular eco supply chains that are transparent and connected by design. Circular eco supply chains are generally Open Loop. In an open loop eco supply chain you sell or supply your plastic scrap to processors within the eco supply chain, the processor converts your plastic scrap into sustainable recycled plastic resin made to each of their customer’s specifications, and the processor sells-supplies their recycled plastic resins to multiple end use manufacturers all within the eco supply chain network. This approach enables companies on both sides to diversify, collaborate on technologies and innovations, gain efficiencies together, and even share reporting through the supply chain. This approach connects sustainability from waste-to-recycle-to-reuse. Participating in an open loop circular supply chain helps diversify markets for your plastic scrap, deepens resources and knowledge, and De-risks everyone involved.
2. Certified Destruction road mapping should be implemented to De-risk against Brand Protection
Regardless of your sustainability goals, for many brands.. ensuring absolute 100% certified destruction, prior to disposal or congruent with recycling, is and should be absolutely essential! Whether it’s your logo on plastic packaging, plastic films and bags, or on overstock or defect merchandise, if your brand and logo is printed on it, the last thing you can afford is to have it front & center in a landfill, or strewn on a street, or washed up on a beach. In a day when your brand is one social media click away from a fire storm, ensuring certified destruction should be a necessary component of your sustainability plan. In order to effectively De-risk against brand protection issues related to waste and recycling, a proper certified destruction program should require a written documented road map diagramming the exact locations and destruction process, transportation, handling and processing of your products, including photo/video back up, a confidentiality agreement, and certified destruction documents signed by all vendors involved in your destruction supply chain. Everyone involved needs to value the importance of protecting your brand, with everyone rowing in the same direction.
3. Toll Reuse Closed Loop Recycling Programs help maintain the value of your plastic scrap & De-risk against Market Volatility
While many plastics manufacturers internally reuse much of their own plastic waste back into their own products, due to contamination issues, many others can’t. That’s partially why 90% of all plastics today wind up in landfills or worse! In many cases plastic products and packaging are printed or coated or multi layered, making internal Closed Loop recycling nearly impossible and making Open Loop markets extremely challenging to0. Knowing how costly it was buying your prime virgin plastic resins at the start, having to landfill these kinds of plastic waste materials isn’t just environmentally costly… its economically costly too. At 3%-8% manufacturing waste + disposal cost, whether it’s PET, PP, PS, PE, or other plastic materials, that adds up big time! To De-risk against costly landfilling of challenging plastic waste materials, we recommend connecting in more “specialized eco supply chains” that utilize specialized custom developed niche equipment, recycling technologies, and that offer back up alternative Open Loop markets in case Close Loop isn’t a sole option. We develop these programs for clients all the time. Using specialized technologies to remove challenging contamination enables you to more effectively reuse your own plastic waste back into your own products, preserving value and ensuring maximum sustainability. As example, if your generating PET or PP printed coated packaging scrap and can’t reuse your own scrap, you can utilize specialty processors that can remove the print and coatings off your PET & PP and return back these materials in clear near virgin quality, ready to be reused Closed Loop.
FOR FURTHER GUIDANCE & RESOURCES TO DE-RISK YOUR PLASTICS SUSTAINABILITY INITIATIVES, PLEASE CONTACT US AT: GearedforGreen – Daniel Schrager, President, GearedforGreen 888-398 (GEAR) 4327 firstname.lastname@example.org, www.gearedforgreen.com