BEAVERTON, Ore. -- Retailers and wholesalers examining the total supply chain to streamline operations and uncover new revenue sources had best not leave out their paper mill partners.
Paper shopping bags and corrugated boxes are every much a part of the product flow companies are struggling to manage more efficiently. What some distributors don't realize, however, is that when the materials are bundled and returned to paper mills, paper products turn profits.
The supermarket industry overall returns some 400,000 truckloads of old corrugated cardboard to 200 paper mills around the country each year, said Charles Carl, vice president of Willamette Industries here.
Factor in paper shopping bags and the total volume of paper products bought back by mills exceeds 8 million tons each year.
Retailers baling corrugated cardboard and bags for recycling not only collect $60 to $150 per ton, depending on how far the mills must transport the materials, but they also avoid tipping fees at the local landfill.
"Landfill tipping fees vary widely from one part of the country to the next," said Carl, who also serves as chairman of the Paper Bag Recycling Council, American Forest & Paper Association, Washington.
"On average, tipping fees could be reduced by $12,000 a year and the revenue from old corrugated would be about $6,000 a year for a total cost swing of $18,000."
Carl said supermarkets are by far the largest recyclers of paper products: "Those bales in the back rooms of the store represent the biggest and heaviest recycling operation going on of any kind, anywhere and any product."
Though retailers have reaped the benefits of recycling paper for some time, there's still much more to be gained, he said, because paper mills' demand for raw material far exceeds the supplies they can acquire locally.
"The value of these old corrugated bales has gone up so much that the retailers have to store them inside at night or people will come by and steal them," he noted.
Wakefern Food Corp., Elizabeth, N.J.; Spartan Stores, Grand Rapids, Mich.; and Carr Gottstein Foods, Anchorage, Alaska, are among the industry leaders in recycling, Carl said. Companies in California, Colorado, Arizona and the Northwest and Northeast regions of the country also have good programs.
More than 75% of retailers participate in paper recycling of some degree, he noted, but because the practice has become routine, it seldom garners recognition.
"I told Carr's that they were the provider of materials to make their own bags. This made them feel good. They were doing it all along and just didn't know that.
"If all they did was add up how much came out of their balers each year and the direct reduction in landfill, they'd have a very good story to tell. They are our biggest recycler; it's unbelievable how much they do."
Carl said retailers like Carr's stand to benefit in the long term because paper mills, including the five operated by Willamette Industries, will pay to retrieve materials from nearly any part of the country. Willamette recycles more than 1 million tons of corrugated boxes and paper bags each year.
"Fiber for paper, virgin fiber, is in fairly short supply. We're already using fiber to the fullest, so recycled paper expands our fiber base," he said. "A lot of our growth in this [paper] industry is coming from recycling.
"We're designing paper mills in this country now where we can't run at high efficiency without it. Our industry is dedicated to spend $10 million in new equipment to utilize recycled materials between now and the year 2000."
Wakefern and Spartan Stores, standouts in recycling of paper bags and corrugated cardboard, are among those companies that take paper shopping bags back from shoppers for recycling. Customers who reuse their bags receive a nominal discount on their purchases.
"I think Wakefern has had the best success of anyone in that," he said. "They have a lot of environmentally conscious shoppers feeling good about doing that."
Other retailers, like Pratt Foods, Oklahoma City, and Van Winkle's IGA, Portales, N.M., for example, have offered shoppers five-cent rebates for each bag brought back to the store and reused.
"What we'd like to do is get those bags back if we can and it's real easy for the retailer, if they get them back from the shopper, to be paid for them. A lot of retailers don't know that paper bags and corrugated boxes can be co-mingled."
Although retailers do not necessarily want to become the community recycling depot, Carl said, they can still do their part to conserve the materials by encouraging reuse.
The Paper Bag Recycling Council has launched several programs to promote reuse through public service messages printed on bags. Curbside recycling, he added, is another important component of the program.
"We are trying to promote curbside recycling and the use of the corrugated carton as the container of choice. It allows us to capture the fiber we need so bad and it doesn't necessarily make the supermarket the recycling center of the neighborhood."