Walmart to gain $3.4bn by reducing packaging

Walmart and Amazon, the biggest offline and the biggest online retailer in the world, have started a program to reduce excessive packaging. In two years time, Walmart hopes to reduce its packaging by 5% (compared to 2008), resulting in a staggering $3.4 billion (€2.5 billion) less spendings on packaging per year.

Garbage: 350 kilos per person per year

The American Environmental Protection Agency estimates that one third of all the garbage in the US is packaging, amounting to over 350 kilos per citizen per year. In December, the problem becomes even more acute, as household waste increases a further 25%. Apart from financial considerations, the giants’ program is therefore also based on environmental issues.

Frustration free packaging

Personal experiences also sparked the decision: like many people, Amazon founder Jeff Bezos has experienced ‘wrap rage’ or “the stress that people feel when they can’t open the packaging of a product”. His company now helps its suppliers in finding innovative methods of packaging that reduce the stress on man and nature, by using less packaging made from more recyclable products.

Amazon has been working on its “Frustration free packaging” since 2008, when the first 19 products met the program’s standards. Now over 80,000 products (representing over 12 million items sold) meet the requirements, and Amazon hopes to triple that number in 2012.

97% garbage reduction

Walmart too is taking initiatives in this field: Hewlett Packard has won a design challenge of the world’s biggest offline retailer by designing a protective bag for its notebooks that reduced packaging of 97% and, also important: reduced the required transport capacity by 25%. Another solution was developed by bluetooth headset maker Plantronics: by replacing AC chargers with (far smaller) USB cables, less material is needed – both for products and packaging…