Final Report Making more out of in-store merchandising … merchandising final...This report...

Final Report

Making more out of in-store merchandising to optimise packaging

Project code: RTL117 Research date: February 2007 to October 2007 Date: June 2008

WRAP helps individuals, businesses and local authorities to reduce waste and recycle more, making better use of resources and helping to tackle climate change.

Written by: Mark Shickle The Brewery

Front cover photography: Merchandising concepts contained in this report applied to the fresh meat category. WRAP and The Brewery believe the content of this report to be correct as at the date of writing. However, factors such as prices, levels of recycled content and regulatory requirements are subject to change and users of the report should check with their suppliers to confirm the current situation. In addition, care should be taken in using any of the cost information provided as it is based upon numerous project-specific assumptions (such as scale, location, tender context, etc.). The report does not claim to be exhaustive, nor does it claim to cover all relevant products and specifications available on the market. While steps have been taken to ensure accuracy, WRAP cannot accept responsibility or be held liable to any person for any loss or damage arising out of or in connection with this information being inaccurate, incomplete or misleading. It is the responsibility of the potential user of a material or product to consult with the supplier or manufacturer and ascertain whether a particular product will satisfy their specific requirements. The listing or featuring of a particular product or company does not constitute an endorsement by WRAP and WRAP cannot guarantee the performance of individual products or materials. This material is copyrighted. It may be reproduced free of charge subject to the material being accurate and not used in a misleading context. The source of the material must be identified and the copyright status acknowledged. This material must not be used to endorse or used to suggest WRAPs endorsement of a commercial product or service. For more detail, please refer to WRAPs Terms & Conditions on its web site: www.wrap.org.uk

Executive summary This report explores the role that merchandising displays can play in enabling primary packaging to be optimised. It covers a variety of product categories including chilled, frozen and ambient, and presents different display options which could be taken forward by the retailers and their supply chain. Retailers are looking for advice on how to achieve the challenging packaging reduction targets that they have set themselves. They are looking for practical ideas that can be delivered in the short-term which do not require any dramatic store layout modification. To give customers choices, Good, Better, Best (GBB) segmentation is now operating in most product categories, particularly in retailer brand products. The overall purpose of this project was to explore how GBB packaging can be moved to the most minimised format feasible, while using merchandising to portray the quality cues and differentiate between the different value propositions. To understand how product information and brand equities are being communicated through merchandising on-shelf at point-of-sale a photographic audit was undertaken in the UK, Spain, Sweden and USA, which were deemed to be countries that would give a broad cross-section of current merchandising. The project then identified several opportunities to deliver product impact and enhanced communication on the shelf and area around the pack, rather than from the pack itself - thereby proposing potential savings of up to 90% on primary packaging. Four key themes were developed: 1 Display shippers - delivering more value from corrugated board 2 Shelf communication tools - providing more brand equity on shelf 3 Organisation and impact - how to enhance minimised packaging 4 Returnable cases - iconic elimination of secondary packaging Within these themes eight different concepts were developed focusing on ready meals, fresh pasta, pizza, meat, cereal and frozen. The potential of these ideas was discussed during the concept development stage with Asda, Tesco and Marks & Spencer. Modifications were incorporated and are now being considered as part of integrated packaging and display developments. If these concepts were implemented in-store, the benefits would include: 1 Commercial benefits as a consequence of reduced packaging use 2 Less packaging ultimately in the household waste stream, and subsequent CO2 emission reductions 3 Logistics benefits , particularly from the use of closed-loop systems 4 Positive feedback from consumers who are looking for less packaging

Making more out of in-store merchandising to optimise packaging 1

Contents 1.0 Introduction ............................................................................................................................. 3

1.1 The call for less packaging .....................................................................................................3 1.2 An example...........................................................................................................................3 1.3 Retail Ready Packaging..........................................................................................................4 1.4 The challenge........................................................................................................................4 1.5 The concepts ........................................................................................................................4

2.0 Examples of current in-store merchandising ........................................................................... 5 2.1 Shelf trays reusable add-ons ..............................................................................................5 2.2 Enhanced shipper cartons ......................................................................................................5 2.3 Enhanced shelf edges ............................................................................................................6 2.4 Store navigation ....................................................................................................................6 2.5 Dispensing presentation.........................................................................................................7

3.0 Packaging optimisation through merchandising ..................................................................... 8 3.1 Display shippers ....................................................................................................................9

3.1.1 Dispensing shipper with product graphics ...................................................................9 3.2 Shelf communication tools ...................................................................................................10

3.2.1 Hinged flap for additional product messaging ...........................................................10 3.2.2 Enhanced graphic clip-on/stick-ons ..........................................................................11

3.3 Organisation and impact ......................................................................................................12 3.3.1 Organiser rails ........................................................................................................12 3.3.2 Frozen hinged flaps and returnable shipper combination ...........................................13 3.3.3 Shelf liners .............................................................................................................15

3.4 Returnable crates ................................................................................................................16 3.4.1 Roll-in cages and shippers, with graphic panels ........................................................16 3.4.2 Refillable cages.......................................................................................................17

4.0 Packaging optimisation principles - the challenge for merchandising .................................. 18 5.0 The return of returnable packaging ....................................................................................... 19 6.0 Telling the story of packaging reduction ............................................................................... 20 7.0 Merchandising concepts......................................................................................................... 21

7.1 Pasta elevation....................................................................................................................21 7.2 Ready meals elevation .........................................................................................................22 7.3 Pizza elevation ....................................................................................................................23 7.4 Meat elevation.....................................................................................................................24 7.5 Frozen elevation ..................................................................................................................25 7.6 Cereals elevation .................................................................................................................26

8.0 How to implement the ideas contained in this report............................................................ 27 9.0 Operational trials of using merchandising systems to reduce food and packaging waste .... 28 10.0 Glossary.................................................................................................................................. 29 Appendix 1 Concept review with Retailers, Brand owners and Suppliers ......................................... 30


1.0 Introduction 1.1 The call for less packaging Consumers are becoming increasingly conscious of their personal impact on the environment from the things they consume and throw away. Retailers have reacted by setting themselves challenging targets, stimulated by the Courtauld Commitment, to reduce packaging materials. Excess packaging for everyday consumables is becoming a negative attribute, and this will become more evident to consumers if local authorities introduce weight-based incentives for household waste collection. The perception of product developer, brand owner and retailer that more packaging delivers an enhanced value-added customer experience is fast disappearing. Most packaging specification decisions (beyond the essential requirement to protect the product through the supply chain) are based on enhancing the products value to the consumer. Brand owners and retailers need clearly defined value propositions to target sales and encourage consumers to trade up from Good to Better and Better to Best. There is no consistent rule as to what constitutes GBB packaging expression. Sometimes best quality products use minimal or no packaging to express authenticity associated with farmed, dairy or baked produce. Often, however, best quality products use over-specified packaging in order to portray the quality of the offering e.g. thicker materials for enhanced feel and print quality, larger packs for on-shelf impact and value for money size impression, or multiple layers and material types for enhanced opening experience. This project is aimed at questioning the assumption that more packaging signals premium quality. It explores how enhanced value can be delivered through merchandising and smarter packaging choices. Product quality and value tiers can be signalled to consumers through simple print and product visibility cues with minimal packaging materials. An example for pizza is shown below. 1.2 An example Three pizzas are contained in a flow wrap/fin sealed bag manufactured from thin film. Typically pizzas are currently wrapped in shrink film and contained in either a full or partial carton or sleeve. Generally, more premium ranges currently use more packaging. The proposal is that all ranges of pizza use less packaging. A Good product would be contained in a transparent bag with minimal and limited colour palette graphics. The Better product would have more graphics to tell a product quality story and the Best product would have a metalised silver film clear window and black printed rear of pack. This is illustrated below. Good Better Best Current

Proposed

Retailers can transfer these generic category rules into almost any branded and retailer own branded product group, with the benefits of optimising primary packaging. If all products in a category (including GBB tiered products) use the same minimal packaging format, retailers could achieve significant waste reductions. Any compromise of visual performance on shelf could be replaced by extra on-shelf communication. This would have to be clearly communicated to consumers to ensure their acceptance. Obviously, the main purpose of packaging is to protect the product, and the proviso of all the concept development is that product quality is not compromised.


http://www.tesco.com/superstore/product/search.aspx?from=SEARCH&search=tesci+pizzahttp://www.tesco.com/superstore/product/search.aspx?from=SEARCH&search=tesci+pizzahttp://www.tesco.com/superstore/product/search.aspx?from=SEARCH&search=pizza+express+pizzas

1.3 Retail Ready Packaging Retail ready packaging (RRP) has been introduced extensively over the last few years, mainly in order to ease shelf-filling. Prior to the introduction of RRP, many products would be delivered to the store in a cardboard box, which would be disposed of when the products were put out onto the shelf. With the introduction of RRP, typically on-shelf, the products are displayed in a low-height on-shelf tray to hold the units for sale. In the back-of-store, the remaining part of the RRP pack will contain a significant amount of plastic film and corrugated board that is disposed of without adding any value to product presentation. There is a view that RRP has added to the amount of secondary packaging, but this is often not the case it has often merely changed the format of the secondary packaging. The key point is that the low-height on-shelf tray could be used more effectively to communicate aspects of the product it holds and to enhance display, rather than be merely used for shelf-restocking purposes. Many of the concepts that have been developed use RRP more effectively, but do so in a way that does not lead to an increase in secondary packaging. 1.4 The challenge Feedback from retailers consulted during the development of this project highlighted the need to consider communication of product values within the context of the existing, shelf-efficient and operationally effective retail environment. No additional space can be provided, no major changes to store layout can be considered and RRP cannot be sacrificed. 1.5 The concepts The design explorations detailed in this report have been grouped into four concept groups: 1 Display shippers

Aids product and brand communication with printed images of product ingredients or meal setting. Tear out or folding features add functionality and impact with little or no cost.

2 Shelf communication tools

Provision of larger graphic areas to aid product and brand communication. 3 Organisation and impact

Physical devices that are used with existing shelving to order and control irregular shaped products that without a carton or tray are unable to be presented consistently.

4 Returnable crates and roll-in cages

Crates already provide a distribution and display solution for high volume, fast turnover products such as bread and produce. This research expands the use of returnable crates and cages and combine them with additional graphic communication concepts.


2.0 Examples of current in-store merchandising To understand how product information and brand equities are being communicated through merchandising on-shelf at point-of-sale a photographic audit was undertaken in the UK, Spain, Sweden and USA. Product categories reviewed included:

Bakery Cheese / dairy Chilled meals pasta Cosmetics Dry goods cereals Fish chilled Frozen foods Homecare Meat chilled

Key observations in product presentation and differentiation were as follows: 2.1 Shelf trays reusable add-ons By providing low cost components that sit on, or are attached to shelves, shelf ready shipper trays can be transformed. Packs and product visibility can be enhanced through use of themed materials or product/brand information.

2.2 Enhanced shipper cartons

Product presentation and shelf standout is enhanced by printing the shipper case or adding tear out/shaped features. The internal surfaces can be printed to increase shelf impact.


2.3 Enhanced shelf edges

Clip-ons and pop-outs are used widely to create range and product stand out. One of the challenges for packaging reduction is to replace pack communication and stand out with equal customer engagement delivered from the shipper and shelf. The Health and Beauty category can offer several examples of how enhanced presentation can be driven with shelf modification. For example, the extra horizontal space gained by the Clinique example in the centre photograph. Black and silver colours have become shorthand for premium presentation. Packaging materials and more recently shelving systems have started to reflect this by switching from white/cream to silver.

2.4 Store navigation Adding vertical strips or pop-out banners to shelves helps shoppers navigate categories. The examples show non-branded graphics. Navigation devices are often more successful when the visual cues of the brand category leader are used. For example, the purple of Cadburys chocolate, the black of Axe/Lynx body spray, or the red of Coca-Cola.


2.5 Dispensing presentation This enhanced shipper presentation offers great opportunities to communicate products and brands. The large surface area available creates high visibility and category disruptive shelf displays.


3.0 Packaging optimisation through merchandising To illustrate the potential packaging material savings available, merchandising concepts have been visualised for various product areas. Typical GBB packaging has then been identified, and the potential weight savings calculated if all the packs moved to the lowest weight packaging format. An example for pizza packaging is shown below. Best: 78g

18g: Printed flow-wrapped bag containing foam board.

77% reduction

Better: 33g

18g: Printed flow-wrapped bag containing foam board.

45% reduction

Good: 18g

18g: Pizza shrink- wrapped onto foam board with sticker branding.

0% reduction


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3.1 Display shippers 3.1.1 Dispensing shipper with product graphics When secondary packaging components can be reduced or eliminated, the shipper carton or shelf ready tray can be utilised to replace the pack communication - images of serving suggestions, or product ingredients. The example shown below illustrates fresh pasta. The packaging currently consists of a thermoformed tray for standard ranges, but more premium ranges often have an additional cardboard sleeve. If all ranges moved to the lightest packaging option of a tray or pouch (with limited graphic space), then extra consumer appeal can be presented on the shipper front.

Example of weight saving potential BEST

42g

61% weight reduction

BETTER

16g

16g

0% weight reduction

Features:

Front of shipper provides product themes/ recipe information.

Rip-off front for product access.

Rip-off top of the display shipper allows the product trays to be returned to shipper if needed e.g. if consumer changes their mind and does not want to purchase.

Benefits:

Reduces labour in-store.

Large image of meal occasion on shipper front.

Better use of RRP.

Concept can be applied to other categories e.g. ready meals


3.2 Shelf communication tools 3.2.1 Hinged flap for additional product messaging Movable flaps or strips provide extra space for product and brand communication. The example shown below illustrates a moveable flap hinged from the shelf above to allow product access for shelf replenishment and customer access.



29g GOOD


39g

24g

Benefits:

No increase in store labour.

Simple modification to existing shelves.

Concept can be applied to multiple categories e.g. fresh pasta

Strong product branding opportunities.


3.2.2 Enhanced graphic clip-on/stick-ons Most shelf ready shippers attempt to minimise cost with minimal single colour generic print. Some of the cost saved in reducing the primary packaging can redirected to enhancing shipper trays through additional print.

Printed film.

Printed corrugated tray.

Printed U-card contained in shipper, applied to base of tray after opening in-store.


36g


Features:

U-card with branding included in shipper and places on tray when shelf is being filled.

Benefits:


Image of meal occasion on U-card allowing quality cues.


GOOD

Use of U-cards allows the main shipper packaging to maintain constant, giving both flexibility and bulk cost savings

7g

30g


http://www.ocado.com/webshop/getProductDetails.do?sku=39056011&parentContainer=000121110

3.3 Organisation and impact 3.3.1 Organiser rails Adding physical devices to shelves to order and control irregular shaped products. The concept is particularly useful to enhance the presentation of flow wraps, bags and pouches.


81g


Features: Meat is vacuum packed to minimise

packaging and communication is achieved by graphics beside fixture.

GOOD

64g

10g


Flexible strips hide seal areas/excess material.

Strips flex to allow product to be removed.

Benefits: Strips provide area for both product

information and visual themes.

Improves logistics efficiency.

Takes up less space in fridge (in-store and at home)

Considerations: Shelf life

Consumer acceptance.


3.3.2 Frozen hinged flaps and returnable shipper combination As in the previous examples there are creative opportunities to increase the amount of space that can be used for graphic communication. By combining hinged flaps with returnable shipper concepts, the communication messages that would have been previously delivered though a printed carton/plastic container. For example, frozen fish is typically packed in a sealed poly-bag then placed in a printed carton. At home some consumers discard the carton before placing the product in the freezer - it takes up less space. The minimised solution would be to eliminate the carton and provide an enhanced poly-bag with product graphics for brand identification, storage and cooking instructions plus a reseal/reclose convenience feature to reduce food waste.

Flaps attach to upper shelf. Images show serving suggestions.

Flaps swing out-of-way for shelf replenishment


Example of weight saving potential Features:

Large image of meal occasion on shipper front.

33g

10g


Benefits:


Replaces cartons with printed/labelled flow wrapped bags.

Can be used in high moisture environment e.g. frozen.

Takes up less space in freezer in-store and at home.


3.3.3 Shelf liners Nearly all supermarket shelves are coloured white or cream they provide a neutral backdrop to colourful packaging. Reducing primary packaging or switching to more minimal formats will inevitably mean less shelf impact and retail theatre. The introduction of printed liners/sheets to existing shelves provides a low cost method of enhancing product presentation and brand communication.

Permanent printed shelf surfaces provide visual themes and contrast to meat

Example of weight saving potential

60% Weight reduction

Benefits:


Simple modification to shelves.

Concept can be applied to multiple categories e.g. cheese.

Enhances visual appeal of product and pack.

Graphic potential for large promotional messages.

33g 10g


3.4 Returnable crates 3.4.1 Roll-in cages and shippers, with graphic panels Roll-in cages and crates already provide efficient transit of goods in the supply chain and convenient in-store presentation for dairy, bakery and fresh produce. Increased use of the returnable packaging solutions will create significant savings in both primary and secondary packaging. Categories such as detergents and cereals could also be switched into secondary with the typical primary cartons being replaced by pouches or bags.

Re-usable crates for lower volume lines.

Re-usable roll-in cages for high volume lines, as used currently for milk.


91g


Features:

Bags/pouches replace cartons.

Benefits:

62g

8g


High visibility packaging reduction.

Optimised supply chain closed-loop system with reusable packaging. 87%

Weight reduction

Eliminates secondary packaging.

Considerations:

Disruptive shelf and category stand-out.

Consumer acceptance.

Product protection in transit and in shopping trolley.


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3.4.2 Refillable cages Roll-in cages and crates already provide efficient transit of goods in the supply chain, and convenient in-store presentation for dairy, bakery and fresh produce. Increased use of the returnable packaging solutions will create significant savings in both primary and secondary packaging. Pizza primary packaging is dominated by cartons. Using flow-wrap and shrink wrap together with returnable crates and enhanced shelf presentation offers the potential for significant weight saving.

Front access for front opening freezers

Top access for open top freezers


78g


Features:

Box eliminated and replaced with printed flow-wrapped bag.

33g

18g


Packaging delivered and displayed in re-usable crates (which could be printed to give quality cues).

Crates adjustable for display in any type of freezer or fridge.

Benefits:


Cage/box drops into/onto existing shelf/chill systems.

Concept can be applied to multiple categories.

Enhances visual appeal of product and pack.

Opportunities for printing on inner surfaces or facing edges.


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4.0 Packaging optimisation principles - the challenge for merchandising To achieve packaging reduction targets set by major UK retailers and brand owners every element of primary packaging is being assessed for weight minimisation opportunities. Reducing primary packaging places different demands on secondary packing and merchandising requirements e.g. a pouch is more difficult to display than a carton. Future merchandising solutions will need to support packaging reduction based on the following weight reduction principles: Elimination of components e.g. eliminate u-cards or backing cards. Can primary packaging be replaced with a shelf-ready packaging solution to reduce overall packaging weight?

Minimisation of pack materials e.g. reduce overlapping flaps on cartons or reduce, or eliminate sealing areas/fins on bags/pouches. Cut-away windows in cartons.

Material thickness/weight e.g. minimise thickness of flexible films or solid carton board. Optimise pack dimensions e.g. cartons should have flaps on smallest face to reduce material overlap and duplication. Compact cubes use less material than flat display formats. Product fit e.g. minimise redundant space inside the pack. Challenge product suppliers to control fill levels or machinery tolerances more closely.

Pack material optimisation e.g. reviewing the optimum material to use based on a number factors such as; carbon impact, recyclability and ability to incorporate recycled content.


5.0 The return of returnable packaging The use of Returnable Transit Packaging (RTP) has been increasing for some time. The growth is driven by the benefits of eliminating cardboard, reduced transport costs, increased stock densities and faster in-store merchandising. In-store returnable transit packaging has been shown to increase sales by creating a cleaner image and improving presentation of the sales floor throughout the day. Together, Tesco, Asda and Sainsbury have over 33 million trays in their supply chains. The trays range in size from large bulk pallet boxes to nesting trays. Consumers will be most familiar with current applications for fresh produce, and factory bread. Growth of RTP will continue and more categories will shift SECONDARY packaging into returnable pallets, crates and traysdriven by the need to reduce material usage and the time and cost of recycling. The new demands of material reduction for PRIMARY packaging will provide a new emphasis on RTP. As material weights and thickness gets lower, the potential for product damage increases. RTP could solve this problem by protecting packs through the supply chain and into the hands of the user. RTP also offers the potential to present on-shelf graphics in a more significant way than current shipper trays. Material selection could also be of great interest. Transparent co-polyester plastics offer the necessary impact protection yet could be edge illuminated on shelf to create a totally new type of product displaythe possibilities have yet to be explored. RTP offers retailers and brand owners the potential to make a significant difference to secondary and primary packaging usage in the short term. It is possible that the usage of RTP could become the dominant distribution format which will result in aisle and shelf layouts being designed around the crate for in-store replenishment efficiency and shopping experience. Below is a typical returnable crate used in current supermarkets.


6.0 Telling the story of packaging reduction Consumer awareness of excessive packaging is continually growing, and they are now making positive choices for minimised packaging. Merchandising needs to play up brand equities and tell product stories - even minimised packaging needs to offer some additional/differentiated benefits. There are examples from brand owners and retailers responding to consumer preferences by telling them about packaging reduction. This can be delivered by large aisle banners right down to back of pack copy. It is believed that these messages will become commonplace in-store, on-shelf and on-pack as consumers become more aware of product sustainability and packaging reduction.


7.0 Merchandising concepts The pages in this section visualise product categories utilising the merchandising concepts shown in earlier pages of this document. In all categories we have focused on the potential to create Good, Better, Best presentation from minimised packaging formats. With minor changes to print quality, pack orientation or material weight - value and premium products are assumed to use the same type of packaging. 7.1 Pasta elevation

The front face of the shipper provides a good surface for product illustration and brand communication. Corrugated carton board material can either be pre-printed, or a printed label is applied when the product is first placed on shelf. This gives flexibility for ranges with several product variants, promotional campaigns or small production batches.


7.2 Ready meals elevation

Hinged display flaps

Hinged display panels provide a good surface for product illustration and brand communication. By varying the length and shape (rounded corners or brand logo shape) of the panel/flap products and packs would be able to achieve great standout and differentiation.


7.3 Pizza elevation

Premium defined by colour and shelf/ display treatments

GOOD (VALUE) BEST (PREMIUM) BETTER (SPECIALITY)

Top access crates

Premium pizza in front access crates


7.4 Meat elevation

Printed plastic reusable shelf liners provide a major step change in shelf presentation. Shoppers have unconsciously accepted white or cream shelving systems in supermarkets. By introducing colour and printed graphics to the shelves, the presentation and shelf appeal of loose products (without packaging) and irregular shaped products will be transformed.

GOOD (VALUE) BEST (PREMIUM) BETTER (SPECIALITY)

Premium brands communicated through shelf treatments and display rather than packaging

Vacuum packed meat joints Returnable shelf crates

with product graphics

Printed shelf liners to enhance product presentation

Organiser rails


7.5 Frozen elevation

Better (specialty)

Pack presentation can also be enhanced by printing

the internal and external surfaces of the crate.

Fresh picnmix and bagged foods

create a specialist fish counter feel. Branded hinged and display flaps.

Best (premium)Good (value)

Reusable shippers will provide products previously packed in cartons the potential to shift into flexibles. These lightweight bag or pouch packs need organisation and control that is normally provided by a carton. A partition crate also offers the potential of increased shelf utilisation. Pack presentation can also be enhanced by printing the internal and external surfaces of the crate.


7.6 Cereals elevation

Good (value)

Re-usable / stackable crate.

Roll-in cage Best (premium) products in fixed display -

using returnable shippers.

Best (premium)Better (brand)

Categories such as cereals and powdered detergents are dominated by large rectangular cartons, (maximising area for brand presentation). There is a great opportunity for primary pack reduction by switching into flexible bags. Returnable creates can then be used to provide protection in the supply chain and enhanced presentation in-store.


8.0 How to implement the ideas contained in this report Any changes to the presentation of products and in-store merchandising must be undertaken with extreme care. Profit per square foot of shelf space is measured, as is in-store labour to replenish shelves. Therefore any new trading concept has to deliver specific operational effectiveness targets. Without any specific consumer pull there has been little motivation to change packaging and merchandising principles. However, consumers are now telling retailers they want different packaging and environment responses. Implementing the concepts illustrated in this report can be both straightforward and complex. The supply chain has to be redesigned and store operations aligned. But consumers want these initiatives to let them participate in changing their impact on the environment. Packaging optimisation is going to give new challenges for product and brand communication. Co-ordinating this at the same pace across brands and suppliers of own label will be critical, in order to ensure that a whole category changes at the same time. It is normal to look at the pack in isolation and fine-tune the shelf impact and communication of product values. Packaging optimisation broadens these challenges and will focus development teams to integrate pack and shelf presentation. The benefits of doing this include:

Cost savings from reduced use of packaging and improved logistics efficiencies Lower carbon impact Meeting consumers expectations

A practical guide on how to implement these concepts is found below: 1 Add lightweighting and pack optimisation as a priority in the product range review process. WRAP has

various guide documents that can inform buyers, technical managers and suppliers. These can be found at www.wrap.org.uk/retail Guidelines on primary pack design can be found at www.wrap.org.uk/retail/the_guide_to_evolving_packaging_design

2 Brief the merchandising teams on the challenges of packaging reduction and the role that merchandising can

play in enabling this. 3 Agree a priority category to focus development. 4 Arrange a meeting of suppliers for this category to brief them on packaging reductions and how

merchandising can help achieve this. Share with them some of the concepts in this report, and ask them to generate ideas that would be practical for the whole category - not just their product range.

5 Agree best way forward and implement.

6 Tell consumers what you are doing and why - either by using in-store point of sale, or on-pack

communication. Stress the benefits and added value to them.


http://www.wrap.org.uk/retailhttp://www.wrap.org.uk/retail/the_guide_to_evolving_packaging_design

9.0 Operational trials of using merchandising systems to reduce food and packaging waste

The concepts shown in this report have illustrated the potential weight and cost savings that can be achieved through merchandising. However, a significant barrier to the uptake of such systems by UK retailers is the substantial investment and operation management required. WRAP funding is being made available to cover in-store trials that demonstrate packaging and food waste reduction through the use of merchandising systems (including self-dispensing). Support will be available for the establishment and evaluation of large scale, operational trials in the Grocery sector. A range of merchandising systems and formats could be used to reduce overall packaging including: point of purchase and point of sale communication; self-dispensing systems; shelf-ready packaging and retail-ready packaging; and enhanced shipper cartons. Trials within the following categories will be particularly welcomed: fresh, chilled, frozen, ambient, and laundry categories. Examples of trials which may be supported:

Demonstration of how GBB packaging can be moved to the most minimised format feasible by using merchandising to differentiate between the different value propositions e.g. move to shrink-wrapped meat,

supported by on-shelf communication to convey premium qualities of product.

Trials to demonstrate the use of in-store self-dispensing technology e.g. self-dispensing units for laundry products within the Household Category.

Benefits of being involved

Implement a whole packaging systems approach, which identifies overall reductions in packaging and associated financial and carbon savings

Identification of reductions in food waste, as a result of reduced damage to products Help achieve internal packaging reduction targets, as well as those set in the context of the Courtauld Commitment

Opportunity to install more radical innovative merchandising/dispensing systems that require investment to establish.

Timescales for Merchandising/ Self-dispensing Trials Tender Invitation circulated June 2008 Trials to commence by Autumn 2008 Trials to be completed by Winter 2009/10 Next Steps An Invitation to Tender, for funding to establish trials, will be circulated in early June 2008. If you would like to register interest in receiving notice of this tender publication, or you would like to discuss a potential partnership working project, please contact Nikki Sully on 01295 817877 [email protected].


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10.0 Glossary Flexibles A generic term for primary packaging formed from polymer based film i.e. sheet material thin enough to be flexible. Flow-wrap A tube of thin plastic material, which is typically sealed by pinching and heating the end of the tube. Good, Better, Best (GBB) Tiered segmentation of product ranges to provide consumers with product quality and cost choices. Point of sale (POS) The physical communication materials and display structure that presents the products on-shelf. Often a temporary structure that is an additional element to the shelf developed and supplied by the brand owner/product manufacturer. Merchandising The presentation of products on-shelf, measured by the effectiveness of product communication and sales performance. Retail Ready Packaging (RRP) Created to speed the replenishment of shelves by placing the case containing multiple products directly onto the shelf. Point of purchase (POP) The physical communication materials and display structure that presents the products on-shelf. Often a temporary structure that is an additional element to the shelf, developed and supplied by the brand owner/product manufacturer. Returnable shippers Crates or boxes that are returned to product manufacturer or regional distribution centre to be replenished eliminating the need for shipper cartons and display trays. Shelf Ready Packaging (SRP) Created to speed the replenishment of shelves by placing the case containing multiple products directly onto the shelf. Shrink-wrap/film A thin film of plastic material that is heated and shrinks into contact with the product/pack surface.


Appendix 1 Concept review with Retailers, Brand owners and Suppliers In order to understand the barriers to change we presented a selection of generic concepts to retailers, brand owners and product suppliers. The following are a selection of key comments: Supermarket retailers The consumer has to change mindset from current merchandising conventions We have to provide our customers with information to make packaging choices A concept that requires more labour in-store is not a concept Great idea but we need to tell the full story to our customers Brand Owner Supermarkets dont look after our displays would be concerned about adding more POS for that reason. Would end up having to visit more often to make sure it is effective Brand image is key differentiator And the packaging style and form is a key part of the brand identity. The cost for redevelopment of new packaging would be borne by the brand owners adding POS as well simply adds cost to the brands (not the retailers) squeezes profit margins. Packaging manufacturer We have a huge amount of materials technology that will minimise packaging, retailers need to change the accepted rules of presentation Summary A recurring theme was the need to complete the loop in terms of co-operation - suppliers working with brand owners and retailers together. In some cases, where there is a bigger opportunity in a generic sector (i.e. chilled meat), it was agreed that a combined effort by the big four leading supermarket brands would be essential to effect meaningful change. Individual brands felt under pressure to respond to consumer demands for sustainable packaging but were limited in the scope and cost burden they could take on in terms of R&D cost to change production all of which would be borne by them. In particular, they were concerned that any additional POS/merchandising concepts must be easy to look after/maintain. The ideas that attracted the most interest were hinged flaps which had particular relevance for chilled categories. Printed shelf liners proved to be very relevant for fresh red meat, bakery and grocery. Roll-in cages and returnable trays for cereals prompted a major retailer to challenge the brand leader to switch packaging into pouches and eliminate secondary packaging. All agreed consumer engagement was key. Educating the consumer as to the benefits to change behaviours and mindsets was the biggest challenge however everyone agreed that consumers were now making positive choices for less packaging with environmental benefits


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1.0 Introduction 1.1 The call for less packaging 1.2 An example 1.3 Retail Ready Packaging 1.4 The challenge 1.5 The concepts 2.0 Examples of current in-store merchandising 2.1 Shelf trays reusable add-ons 2.2 Enhanced shipper cartons 2.3 Enhanced shelf edges 2.4 Store navigation 2.5 Dispensing presentation

3.0 Packaging optimisation through merchandising 3.1 Display shippers 3.1.1 Dispensing shipper with product graphics

3.2 Shelf communication tools 3.2.1 Hinged flap for additional product messaging 3.2.2 Enhanced graphic clip-on/stick-ons

3.3 Organisation and impact 3.3.1 Organiser rails 3.3.2 Frozen hinged flaps and returnable shipper combination 3.3.3 Shelf liners

3.4 Returnable crates 3.4.1 Roll-in cages and shippers, with graphic panels 3.4.2 Refillable cages

4.0 Packaging optimisation principles - the challenge for merchandising

5.0 The return of returnable packaging 6.0 Telling the story of packaging reduction 7.0 Merchandising concepts 7.1 Pasta elevation 7.2 Ready meals elevation 7.3 Pizza elevation 7.4 Meat elevation 7.5 Frozen elevation 7.6 Cereals elevation

8.0 How to implement the ideas contained in this report 9.0 Operational trials of using merchandising systems to reduce food and packaging waste 10.0 Glossary

Final Report Making more out of in-store merchandising … merchandising final...This report...

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