Wal-Mart Stores - Package Modeling

Well, it was bound to happen: Wal-Mart wants your company to 'go green' and the way they are going to make you do it is through Package Modeling, or having you compare your products with your peers. This is part of Wal-Mart's effort to reduce overall packaging by a minimum of five percent by the year 2013. This is a summary of what I learned in the seminar, and I am in no way connected with any of this, but I find this stuff interesting. No matter what your feelings are about Wal-Mart, this will have an impact on your packaging for years to come. 

They have teamed up with ECRM Software (ECRM stands for Electronic Customer Relationship Management or "Efficient Collaborative Retail Marketing" according to their website.) and  Thumbprint LTD

Last week, I took the webcast to get a feeling on where this is going to take all of us. There are four modules:

1. Retail Link- Developed by Wal-Mart to manage key elements of the buyer-seller relationships.

2. Sustainable Packaging Scorecard- Developed by Wal-Mart with leading public and private experts and as an extension of Retail Link to evaluate packaging.

3. Wal-Mart Package Modeling- Developed to help manufacturers find sustainability improvements in their packaging

4. MarketGate™- Developed by ECRM to help manufacturers network with packaging Suppliers. 

Wal-Mart is encouraging all of their suppliers to enter all of their packaging SKU's into #2 and is currently part of their purchasing process. Once your packaging is entered, it will be compared with everyone else's packaging and given a score. You will get to see how your packaging does against your competitors packaging. Not only that, you can run 'what-ifs' to see how changes affect your score. Although you won't be able to see who your competition is, obviously Wal-Mart will be able to review this info to make more informed purchasing decisions. 

Basically, you will have to divide the product volume by the selling LxWxH. Then multiply that out by the transport cube volume. Then those figures will be applied along with nine material metrics weighted by product category. Some of these categories have nothing to do with the packaging at all. The nine metrics are: Greenhouse Gas Emissions, Material Health & Safety, Average Distance to Transport Materials, Package to Product Ratio, Cube Utilization, Recycled Content, Recovery, Renewable Energy, Innovation Different from Energy Standards. 

No good or bad scores, but higher scores are better and make note that their buyers bonuses will be partly dependent on purchasing products with sustainable packaging!

Before you make any decisions on what your company is going to do about this I encourage you to take the seminar and ask questions. While I applaud Wal-Marts efforts, the burden of this will be placed firmly on the supplier.  You are going to have to have engineers and/or people schooled in how to do this to enter your SKU's. I have no idea how this will affect the industry, but I suspect that the packaging will continue to get smaller/thinner until the pallets all but disappear and the product hits the floor. This might also encourage green-washing. Feel free to leave your comments.