ISRI’s PSI Chapter held an event in conjunction with the ISRI Board of Director’s Meetings in Austin, TX last week. They brought in many industry-leading guest speakers to discuss what’s going on in scrap paper markets. No one has a reliable crystal ball but we tasked our speakers to look beyond 2019 with insightful long-term projections to help keep the industry looking forward. One of the major topics was the growth of e-commerce. It’s something that’s affecting all of us both at home and at work. More and more corrugated boxes are landing on our doorsteps then filling our recycling bins. Moore & Associates put together an in-depth study on “The Impact of E-commerce on Residential Recycling Programs,” which was presented at the meeting.
Here are a few takeaways from Susan Cornish, who led the study:
- In year 2000, e-commerce accounted for less than 1% of total retail sales. E-Commerce has grown from 4% to 10% of retail sales in the last 10 years and online retail sales are predicted to double or triple to 25% or 30% of total retail by 2025 or 2030.
- A recent consumer survey by Moore & Associates shows that 6 out of 10 Americans expect to do “a lot more” or “somewhat more” online shopping next year. A mere 6% expect to do less.
- The volume of box shipments is growing overall … but not nearly as fast as E-commerce. Corrugated remains the most important material for secondary packaging, accounting for 50-80% of shipping containers. But change is coming.
- The need to protect the product during shipping led to ‘over-boxing’. More recently ‘right-sizing’, ‘box-on-demand’, and other trends encourage reduced packaging. Yet brand owners need to deliver the brand experience at the moment of ‘unboxing’, so packaging is unlikely to be reduced to an efficient minimum.
- From 2016 to 2017, the apparent recovery of used corrugated boxes (OCC) dropped from 92.9% to 88.8%: 300,000 fewer tons of corrugated containers were recycled vs. the year before.
- Where are all the boxes going? New research by Moore & Associates indicates that over ¼ of corrugated boxes received by households are “kept for later re-use” and not sent to curbside recycling, drop-off, or trash.
- The OCC content of Mixed Paper is rising as a result of more corrugated in the home vs. at retailers – but are we maximizing OCC recovery? Things to consider: at the MRF – ensure all OCC from the incoming stream is recovered. The optimal level of OCC in Mixed Paper may vary with end use. Mills would do well to get involved in specifying the optimal level of OCC in Mixed Paper.
The final results of the study with a more extensive consumer survey will be presented at the Paper Spotlight during the 2019 ISRI Convention and Exposition on April 10.