Sustainability in practice

A case of environmental packaging for ready to

assemble furniture Manuel Seidel, Mehdi Shahbazpour and A/Prof. Des

TedfordPresented by Manuel Seidel

Structure of Presentation

Motivating factors for sustainability in business

Sustainability as a competitive factor

Implementation barriers Prerequisites for success Case Study – furniture manufacturer

Motivating factors for Sustainability initiatives

Legislation To comply with a set of regulations

Moral responsibility Competitiveness

Improve profitability by gaining market share through advertising environmental compliance

Cost reductions through energy and material savings

.

Sustainability as a competitive factor

In the EU sustainability has become an order qualifying (hygiene) factor in recent years.

However:In New Zealand, sustainability does not yet carry as much weight as a competitive factor when compared with Europe.

Implementation barriers

Difficulties for New Zealand manufacturers who want to improve environmental performance due to:

Absence of external driving forces (legislation, market pressure)

Limited resources available for sustainability projects

Prerequisites for Successful Sustainability Projects

To overcome these difficulties, sustainability initiatives must satisfy the following requirements:

Support of top management Keep project costs to a minimum Benefits must be quantified All other dimensions of performance

also need to be satisfied

CML is a NZ SME specialising in Ready-to-Assemble (RTA) furniture

CML has made a commitment to sustainability and is aiming to obtain ISO14000 certification

CML spends around $500,000 annually on polystyrene for packaging – a significant expenditure for a non-value adding component

Case Study of Furniture Manufacturer –Environmental Packaging

Polystyrene blocks

Furniture components

For the product pictured the cost of polystyrene per pack is $2.40

Why should polystyrene be reduced or eliminated?

• Polystyrene is harmful to the environment (moral responsibility)

• It is difficult to recycle, with no kerbside recycling available in New Zealand (customer satisfaction affected)

• An increase in market share can be achieved through advertising of the company’s environmental compliance (ISO14000, EnviroMark etc)

• Previously unavailable markets may be penetrated (e.g Europe)

• The New Zealand Government is planning to introduce stricter laws and environmental regulations in the near future

• Possible cost reductions• Increase in local competition (IKEA entering NZ market)

Reasons for polystyrene popularity

Polystyrene is: low in cost compared with other

materials provides excellent impact protection has a ‘memory property’ is light weight

Project Approach

Packaging design rules

Development of alternative

solutions

Experimental investigation of

proposed solutions

Review of packaging issues, and investigation and analysis of current packaging rules at CML

Packaging guidelines and

legislation

Market trends and industry practices Organisational

issues

Practical Issues

Shrink-wrap/PolystyreneShrink-wrap/Cardboard

Comparison of Systems

Polystyrene Foam

CardboardCorn-starch

Alternatives Investigated:

Proposed Packaging System

Low number of internal cardboard components

Shrink-wrap sub packages

Project Outcomes

1. Short term – Polystyrene reductions• Reductions of up to 14% achievable • Potential for $70,000 annual savings

2. Medium term – Shrink wrap• Reduce damage within packages• Increased customer satisfaction and

reduced return of damaged goods

3. Long term – Cardboard or Corn-starch replacement

• Open the European market

Conclusions

Low cost projects can achieve very good environmental and cost saving results

Acquiring government funding is an important requirement to successfully completing sustainability projects in New Zealand.

University student projects make a great affordable resource for companies.

Export markets with stricter environmental legislation can be used as an incentive for improvement.