PACKAGING VALUE CHAIN

Transcription

1 PACKAGING VALUE CHAIN TOPIC 1: PACKAGING VALUE CHAIN OVERVIEW Dr. Claire Sand Michigan State University School of Packaging

2 Topic 1 Packaging Value Chain Overview 2 Overview Packaging Evolves to a Supply Chain Packaging Supply Chain 1980S 1990s Packaging Value Chain Derivation Value Defined Supply Chain and Value Chain Coexist Circular Value Chain

3 Topic 1 Packaging Value Chain Overview 3 Packaging Evolves to a Supply Chain Ancient civilization to 1800s packaging was designed for a specific good Sumerian pottery trade in 5200BCE South America to Western Mexico in 1200BCE Mississippian water trade routes in 1200 Ming era domination of Indian Ocean in 1500s

4 Topic 1 Packaging Value Chain Overview 4 Packaging Evolves to a Supply Chain Civilization began to refine and widen supply chains Japan s Closed Country Edict in Fine tuned supply chains Trade expansion in Widened supply chains

5 Topic 1 Packaging Value Chain Overview 5 Packaging Evolves to a Supply Chain During Industrialization the primary responsibility for the transport of good shifted from producer to the purchaser Ford defined packaging Packaging customized for different buyers

6 Topic 1 Packaging Value Chain Overview 6 Packaging Evolves to a Supply Chain s Post war era saw efficiencies grow Drucker coined the term, knowledge worker in 1973 Energy crisis led to focus on bulk shipments & DCs which reduced energy costs associated with distribution Global situations in operations

7 Topic 1 Packaging Value Chain Overview 7 Packaging Supply Chain 1980s Mass production of packaging increased Vertical integration internalized supply chains External supply chains needed management process to deliver: JIT ECR

8 Topic 1 Packaging Value Chain Overview 8 Packaging Supply Chain 1980s Porter s Model of Supply Chain Management in 1985

9 Topic 1 Packaging Value Chain Overview 9 Packaging Supply Chain 1980s Logistical optimization Global sourcing global buying

10 Topic 1 Packaging Value Chain Overview 10 Packaging Supply Chain -1990s Economic support for innovations drives commodization China with corrugated Location became irrelevant

11 Topic 1 Packaging Value Chain Overview 11 Packaging Supply Chain 1990s Strategic Alliances Price Fueling innovation, cost savings, sustainability Alliances stretch From Packaging to retailers BASF-Solvay joint venture

12 Topic 1 Packaging Value Chain Overview 12 Packaging Value Chain Derivation Phase 6 of Grenier curve shows that organizational growth into the value chain is needed

13 Topic 1 Packaging Value Chain Overview 13 Packaging Value Chain Derivation POS information enabled continuous replenishment and then the supply of packaging was linked directly to sales Sales of products increased sales of the product s package Essentially, once logistics were figured out, the focus on value became more relevant Value began to be assessed down the supply chain

14 Topic 1 Packaging Value Chain Overview 14 Packaging Value Chain Derivation Porters Supply Chain concept goes outside organizations firmly beyond logistics

15 Topic 1 Packaging Value Chain Overview 15 Packaging Value Chain Derivation Porter s value system described the linkages between companies in what we now call the Value Chain This concept was expanded and refined to translate consumer value down the packaging value chain from consumer to raw materials used in packaging

16 Topic 1 Packaging Value Chain Overview 16 The Concept of Value Value: Has Context Is experiential Has a subjective nature Occurs when needs are met

17 Topic 1 Packaging Value Chain Overview 17 Value has context The value of a quality of packaging varies with it context In the late 1980s within the EU, sustainable packaging had value During this same time in the US, sustainable packaging had little consumer resonance or value Now, with the REACH initiatives and EN standards altering global markets, sustainability has value within developing and developed countries The context changed

18 Topic 1 Packaging Value Chain Overview 18 Value is experiential Relationships between companies gain more traction if the companies experience value the same way JL Clark and Farmaesthetics Price based bidding when insisting on quality, time

19 Topic 1 Packaging Value Chain Overview 19 Value has a subjective nature Trust of partners in the packaging value chain aligns: With inexperienced packaging professionals and organizations When economic downturns cause disruption When disaster management is needed

20 Topic 1 Packaging Value Chain Overview 20 Value occurs when need are met Needs within each link of the value chain are met Retailer needs emerged as primary in 1990s Post consumer needs are emerging as primary

21 Topic 1 Packaging Value Chain Overview 21 Supply Chain and Value Chain Coexist Supply Chains seeks logistical optimization from raw materials to consumer

22 Topic 1 Packaging Value Chain Overview 22 Supply Chain and Value Chain Coexist Value Chains seek sustainable competitive advantages from consumers to raw materials Pulling a cart

23 Topic 1 Packaging Value Chain Overview 23 The Circular Value Chain converted packaging raw materials for packaging manufactured packaging components discarded product and package Packaging Value Chain Interfaces Combined product and package sold product and package distributed product and package