Adoption of reusable transit packaging in US industries: a framework for enhanced sustainability

With increasing global concern and attention regarding the causes and implications of global warming (Lash and Wellington 2007), organizations are under growing pressure from multiple external and internal stakeholders to reduce their organizational carbon footprint and improve their environmental performance. This pressure and the importance of reducing supply chain costs leads many organizations to integrate sustainable practices into their supply chain management.

An organization's selection of industrial packaging significantly impacts both the effectiveness and sustainability of business-to-business (B2B) supply chains. Indeed, environmental and cost implications extend throughout the supply chain (Pålsson and Hellström 2016). Over the past decade, volumes of transport packaging material have increased exponentially as a result of globalization, and this increase in packaging waste has historically been countered by encouraging the use of recycling. However, in the circular economy's hierarchy, shifting from material recycling to product reuse retains greater value (Kirchherr et al. 2017) and reduces waste. Furthermore, under certain conditions (Bradley and Corsini 2023), reusing packaging presents a significant opportunity to maintain material and product functionality and achieve substantial cost savings (García-Arca et al. 2017; Coelho et al. 2020). Companies from many industries, including automotive, aerospace, and machinery, have started to adopt reusable packaging systems, and according to the Reusable Packaging Association, the $100 billion market of reusable transit packaging is expected to increase steadily over the coming years (RPA 2020).

Policies and legislation are crucial in promoting supplier responsibility, changing customer behavior, and facilitating the development and adoption of new technologies, thereby improving the economic viability of switching to reusable packaging (Kroon and Vrijens 1995). Equally, there needs to be more focus on incentivizing companies along the value chain to collaborate efficiently and adopt a standardized system (Bradley and Corsini 2023). Reusable packaging systems are still gaining momentum in the US and currently are not fully examined in the context of manufacturing and heavy industries. This research, therefore, aims to evaluate the impact of existing and potential policies and regulations concerning tertiary (transit) reusable packaging in the US aerospace, automotive, and machinery industries.

This paper's contribution is to research the under-explored topic of the implementation of reusable packaging within our defined industries to provide up-to-date insights into the B2B sector's reusable packaging landscape, drawing from the perspectives of industry practitioners. Additionally, the paper highlights overarching issues and barriers essential for strategic policy formulation and top-tier decision-making. Beyond identification, the research also introduces a highly practical framework for the execution of suggested mechanisms to address the main barriers, ensuring targeted intervention. This policy-based framework enables practitioners to effectively advocate for legislative support in order to implement or expand reusable packaging systems. We consider the strategic realm of policy interventions, focusing our intention to address high-level, systemic barriers rather than delving into the operational intricacies. Furthermore, policymakers can utilize this framework to gain insights into the tangible obstacles encountered by businesses, which must be addressed to foster sustainable ecosystems. In the paper, the following research questions have been identified and addressed:

The rest of this study is organized as follows. In Sect. 2, the research methodology is introduced. Section 3 provides research background to identify existing challenges and lists current European and US policies and regulations concerning incentives for adopting reusable packaging systems. Next, Sect. 4 presents the obtained results. Section 5 introduces the framework. Section 6 discusses the research findings and elaborates on limitations and lists opportunities for future research.

This study employed semi-structured interviews and a survey of industry professionals to gather insights into companies' current implementation of reusable packaging systems and the associated barriers and opportunities they perceive. This approach was chosen for its practical applicability, as directly engaging with practitioners offers an invaluable perspective on real-world challenges and solutions. Furthermore, the research aimed to achieve methodological triangulation by cross-verifying insights to present a more comprehensive and multi-dimensional understanding of the subject. This methodology aligns with Mangan et al. (2004) approach, which showed that quantitative and qualitative methodologies can provide more profound insights than using a single method alone. Such triangulation enhances the empirical support for the theory under investigation, leveraging the strengths and compensating for the limitations of various methodologies.

We incorporated methodologies from Robert Yin and John Creswell to validate our semi-structured interview techniques, ensuring the robustness and credibility of our qualitative data collection and analysis. Following Yin's (2018) case study research design, we defined clear research questions, selected multiple cases, and employed a structured data collection and analysis approach. We maintained a case study database by systematically documenting all interview transcripts, field notes, and coding processes. This database was stored securely and organized to facilitate easy retrieval and cross-referencing. Maintaining a chain of evidence involved detailed records of data collection procedures, ensuring that each piece of evidence could be traced back to its source. In line with Creswell's (2013) qualitative research strategies, we designed our interview protocols to elicit comprehensive and meaningful data, incorporating strategies such as triangulation, member checking, and providing detailed descriptions to enhance the credibility and transferability of our findings.

To ensure construct validity, we used multiple sources of evidence and established a chain of evidence. Internal validity was enhanced through pattern matching and explanation building, while external validity was addressed by replicating the study across multiple cases. Reliability was ensured by developing and following a detailed case study protocol and maintaining a case study database. Our interview protocols were designed to elicit rich, meaningful data by including open-ended questions encouraging detailed responses. We adjusted our questions based on interviewees' responses to explore emerging themes and insights more deeply. Rich descriptions were used to capture the context of participants' responses, providing a detailed account of their experiences and perspectives. Triangulation was conducted by comparing data from interviews and surveys and cross-referencing findings with existing literature. We also clarified researcher bias by acknowledging our perspectives and potential influences on the research. Peer debriefing was used to review and validate our analysis, ensuring the credibility and reliability of our findings.

In the first part, research background, the recent related works were examined to establish the current state, identify research opportunities, and provide an overview of various impactful barriers that can potentially be lifted with effective green policies and industry action. The specific criteria used to search for literature included selecting international peer-reviewed research papers from highly impactful academic journals, focusing on studies published within the last ten years to ensure relevance. In the literature review, the articles were obtained from two major citation databases, Scopus and World of Science. Keywords such as "sustainable packaging," "sustainable supply chain management," "environmental impact," and "reusable packaging" were used. Specific criteria were to eliminate the research's inclusion and exclusion bias and achieve the data's heterogeneity (Meline 2006). Only scientific papers focused on sustainable packaging in supply chain management studies concerning environmental, economic, and social aspect assessment were used to complete the research background. Official government reports and publications have also been used in this study. As for the government reports and publications, we focused on the United States, the United Kingdom, and the European Union. We searched for these documents through government websites, official publications databases, and international organizations' resources. Selection criteria included relevance to sustainable packaging practices, regulatory frameworks, and policies impacting supply chain management.

The second part of the study involved a descriptive analysis of survey results from 55 sustainability and supply chain professionals in the US aerospace, machinery, and automotive industries. The survey, with 11 questions, focused on reusable packaging adoption and sustainability practices. Respondents, evenly distributed across the industries, were selected from 100 professionals, yielding a 55% response rate. Supply chain and sustainability professionals within the sectors of machinery, automotive and aviation were identified and selected by the research platform, Centinent. An initial question asked respondents to confirm their industry, with the survey closing down for any respondent who stated they were in none of those three industries. The study used the one-sided Wilcoxon Signed-Rank Test in R for data analysis, suitable for non-normally distributed responses, to compare the median response against a neutral value of 5.5. This comprehensive analysis aimed to identify trends, challenges, and opportunities in reusable packaging, enhancing understanding and validating previous data. It sought to provide insights for managing risks, advocating for legislation, and implementing reusable packaging systems (Olsen 2004). The respondents were informed about the study purpose, procedures, voluntary participation, and guaranteed anonymity.

Four semi-structured, in-depth interviews with sustainability and supply chain professionals from leading American companies were conducted in the final part of the research. We targeted professionals with relevant positions and expertise in sustainability, supply chain management, or related fields, as they possessed the knowledge and insights crucial to our research objectives. The decision to employ the interview method in a semi-structured format was made as it facilitates discovering and exploring individual participants' opinions, diverse experiences, insights, and perceptions. While we had a predefined set of central questions or topics, we could adjust and pose additional questions or seek more comprehensive responses based on the interviewees' input. The core questions posed in the semi-structured interviews were identical to those found in the survey questionnaire provided in Appendix 1. The interviews were conducted by identifying a pool of professionals with specific experience in the industries of interest, composing an in-depth interview scenario, scheduling and conducting the interviews, and analyzing the qualitative data. The interviewees were informed about the purposes of the research, provided with a list of questions before the interviews, and guaranteed anonymity. In conducting the interviews, we adhered to Creswell's (2013) strategies for ensuring the credibility and transferability of qualitative data. Techniques such as triangulation, member checking, and providing rich, thick descriptions were employed to validate the interview data and enhance the study's rigor. Yin's (2018) principles for case study research were applied to maintain a chain of evidence and use pattern matching and cross-case synthesis in data analysis, thereby ensuring reliability and validity. To ensure authenticity and preserve the participants' true voices, we incorporated verbatim quotes from the interviews, following the recommendations of Saldana (2016). Saldana emphasizes the importance of using exact words of the interviewees to maintain the integrity and authenticity of the qualitative data. The following professionals have been interviewed: (A) a sustainability compliance advisor from a Fortune 500 company working in the US machinery industry; (B) a supply chain sustainability professional in the automotive industry; (C) a sustainability consultant for the automotive industry; (D) a supply chain team lead working on reusable packaging implementation in the aerospace industry, stated below as Interviewee A, Interviewee B, Interviewee C and Interviewee D. The interviewees elaborated on their organizations' experience in implementing reusable packaging systems. All interviewees are from companies that have already implemented or had extensive experience working with reusable packaging. Figure 1 represents the research methodology. These interviews, conducted July 2023, sought to identify the real-world priorities, challenges, and insights regarding reusable packaging systems in their industries and to understand the importance of and the current regulatory role in encouraging the adoption of reusable packaging.

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After discussing the methodology employed in the research, it is essential to acknowledge and address the limitations inherent in our research approach. These limitations are examined in the Discussion section.

In this section, we provide the definition of tertiary packaging, discuss existing challenges associated with implementing reusable packaging that could be mitigated with effective green policies and industry action, and review current American and European regulations that aim to assist B2B organizations in adopting reusable packaging.

Pålsson (2018) defines tertiary or transit packaging as that used in shipping, storage, and bulk handling. Reusable transit packaging includes plastic pallets, crates, totes, boxes, tanks, drums, barrels, and dunnage. There are numerous examples of successful design and implementation of reusable transit packaging systems in various industries. Coelho et al. (2020) argue that in B2B markets, many industries use pallets, crates, dunnage, drums, and intermediate bulk containers, where standardization allows for automation and cost reductions. However, there are particular challenges regarding the implementation of reusable packaging systems.

The significant capital investment required to establish reusable packaging and high disposal costs is often a major organizational barrier. The upfront investments required to utilize the system are elevated by the cost of containers or the payment of a deposit for reusable packaging. Also, the risks of loss and damage lead to additional investments and operating expenses (Ilic et al. 2009; Mason et al. 2012).

Often companies cannot quantify the economic and environmental effects of industrial packaging and do not see value in reusable packaging. That can be due to a company's culture, insufficient organizational motivation, or scarce human resources. Adopting a systems perspective that considers the interplay between packaging and supply chain operations across the whole supply chain is crucial to ensure sustainability. Neglecting this perspective could lead to suboptimal outcomes and decreased sustainability performance within the supply chains, as highlighted by Garcia-Arca et al. (2017).

In Europe, packaging and packaging waste has been legislated through a number of directives, including the Packaging and Packaging Waste Directive (1994), the Waste Framework Directive (2004), and the Single Use Plastics Directive (2019). The Waste Framework Directive introduced Extended Producer Responsibility (EPR), and the Packaging Waste Directive requires producers to pay for collecting, recycling, and safely disposing of packaging. Over the last 30 years, almost every European member state has introduced EPR for packaging based on specific national legislation (Monier et al. 2014).

From a B2B reusable packaging perspective, the proposed revision of the Packaging and Packaging Waste Directive of 2022 includes firm targets for waste reduction, reuse targets for specific sectors, and harmonized product rules. For transport packaging, the revised legislation proposes a target of 30% reusable packaging by 2030 and 90% reusable packaging by 2040 (Ragonnaud 2023). Together with greater standardization, these targets will stimulate a seismic shift towards reusable packaging in B2B supply chains in Europe and will stimulate US policymaking.

In the United States, solid waste is legislated across all tiers of government, including the federal, state, and local levels. The Resource Conservation and Recovery Act (RCRA), a federal law enacted in 1976, creates the framework for properly managing hazardous and non-hazardous waste, intending to reduce the amount of generated waste, protect human health and the environment, and save natural resources. According to the solid waste management hierarchy, material reuse is the most preferred solution. However, the RCRA focuses more on recycling than preventing packaging waste generation.

The Environment Protection Agency (EPA) delegates a significant portion of waste regulation to state and local authorities. Forty-eight states have been granted authorization by the EPA (2023) to enforce the RCRA. This authorization mandates that state regulations must meet the federal-level requirements as a minimum standard and can also be more stringent. Since the RCRA is not strongly focused on supporting the adoption of reusable packaging, we should consider other available mechanisms.

EPR is a legislative mechanism that shifts the responsibility for end-of-life of products and waste management from authorities to producers and incentivizes the latter to invest in reusing, repairing, and recycling. This mechanism should motivate producers to design their products sustainably, creating products that would eventually decrease waste, negative environmental impact, and end-of-life costs.

In the US, Maine, Oregon, Colorado, California, Washington, and New Jersey have enacted EPR as of 2023. However, in these states, the legislation prioritizes recyclability rather than reusable packaging as a means to minimize the volume of packaging waste.

Fundamentally, no existing legislation in the US promotes the adoption of reusable packaging despite this resource management strategy being higher up the waste management hierarchy than recycling. This research seeks to address this gap and enable practitioners to advocate for policies that would effectively address the challenges that are currently preventing them from implementing and expanding reusable packaging systems.

In this chapter, we review and cross-validate the results of the semi-structured interviews and the survey with sustainability and supply chain managers from the examined US industries.

In developing the framework (Fig. 13), we identified the five most essential barriers from survey responses and semi-structured interviews across both participating and non-participating organizations. These barriers were matched with policy mechanisms that our data analysis and structured brainstorming sessions with industry experts, including William Hall (his biography is provided in Appendix 3), indicated as the most beneficial. Innovative solutions from successful case studies and literature reviews further supplemented the process. Each barrier was carefully evaluated for its relevance and impact using qualitative insights from interviews and quantitative data from surveys. This iterative process ensured the robustness and applicability of the proposed mechanisms. Some mechanisms were designed to address multiple barriers, recognizing that many operational and financial challenges are intertwined and can be tackled collectively.

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The four most significant barriers for non-participating organizations were that leadership does not see sufficient value, the lack of mandatory status for reusable packaging, that it was considered too complicated, and a perceived lack of storage infrastructure. Respondents from participating organizations concurred that the lack of mandatory status and storage infrastructure were principal barriers, with higher capital costs associated with establishing reusable infrastructure as the final identified barrier.

According to our data analysis, indirect financial support, collaborative platforms, and guidance and regulatory frameworks were deemed to be the most valuable broad policy mechanisms to assist organizations in developing reusable packaging ecosystems. We have prioritized these most high-potential broad mechanisms in the framework, breaking them down into specific initiatives and policies that have proven successful in other relevant studies or were suggested by the industry professionals we interviewed based on their direct experience.

We initially matched the barriers with the mechanisms that would most effectively counter them, then scored each mechanism for its predicted potential business impact (BI) at mitigating that particular barrier, where the highest score indicates a mechanism that could have the greatest positive business impact for assisting organizations in establishing reusable packaging systems. We then assigned a score for each mechanism's predicted ease of implementation (EoI), where the highest number is assigned to the mechanism that could be relatively simple to implement. The scoring methodology for BI and EoI is included in Appendix 2. Mechanisms that score high in both categories fall into the high-impact/high ease of implementation zone, represented by a blue square on the chart. All scores are based on the insights from the literature review, survey, and series of interviews with industry professionals.

Our research and the framework were significantly enhanced by constructive feedback from William Hall, an expert with over 30 years of experience in strategic development, procurement planning, supply chain management, and business continuity in the automotive sector. Mr. Hall guides sustainability, strategic development, supply chain resilience, and risk management projects. Such seasoned insights are instrumental in grounding our findings in real-world applicability and expertise.

Below, we outline the mechanisms identified in the chart that can address the recognized obstacles. These methods will have the most favorable result when they are implemented collectively.

We conducted a comprehensive survey and open-ended semi-structured interviews, complemented by our research into existing literature. This approach was designed to delve into how machinery, aerospace, and automotive companies view reusable packaging. Our focus was on understanding their perception of it, identifying the key barriers hindering its adoption or expansion, and exploring their ideas on strategies that could mitigate these obstacles and encourage the development of a reusable packaging infrastructure.

Our survey concluded that most respondents felt that packaging choice was important for reducing their organization's ecological footprint. The semi-structured interviews strongly supported this sentiment, and the conclusion we drew from both studies and the literature review is that reusable packaging is essential for B2B organizations to achieve sustainability goals. While there are specific differences between the examined industries because of dissimilarities in the products' life cycles, volumes, regulations, supply bases, etc., there are also numerous resemblances. There is also a need to differentiate between B2B and B2C industries since more guidance and support currently exist for B2C sectors with regard to packaging materials. For this reason, this research considers the three industries collectively in order to come to conclusions that can be applied to other B2B industries outside of the scope of our study. Our research suggests that there are sufficient shared barriers, influencing factors, and incentivizing mechanisms across the three industries. Namely, we have identified the following core barriers in the examined B2B industries: the lack of mandatory status for reusable packaging, that leadership does not see value, that it is considered too complicated, that there is insufficient capacity, and that it is considered too expensive. Despite the similarities, it is important to acknowledge potential differences between industries that might have been overlooked. For example, the aerospace industry deals with high-value, low-volume products, which may result in different logistical and financial considerations compared to the automotive industry, which handles high-volume, lower-value components. Additionally, the machinery industry's diverse range of products can lead to varying levels of feasibility and cost-effectiveness in implementing reusable packaging systems. These industry-specific nuances might influence the perceived benefits and barriers to adopting reusable packaging differently.

Our survey results showed that organizations that already have reusable packaging systems in place are significantly more likely to extend the use of reusable packaging (75% in those that have versus 20% in those who have not). This highlights the importance of intra-industry or government mechanisms that would make it obligatory for organizations to implement reusable packaging. Those organizations that are internally motivated to implement such systems will continue to do so organically, but the evidence suggests that the organizations that are non-participatory to date will need an external stimulus to force them to conform and adopt such measures. Once reusable packaging systems have been implemented, our research suggests that organizations will recognize that the benefits outweigh the costs, and newly participating organizations should, in turn, become proponents of reusable packaging, ultimately improving the sustainability performance of B2B supply chains. From a managerial perspective, it is crucial for supply chain leaders to identify and leverage internal champions who can drive the adoption of reusable packaging by demonstrating early successes and creating a positive feedback loop within the organization. Also, managers should consider strategic partnerships with regulatory bodies or industry alliances to advocate for incentives or mandates that can spur broader adoption. This approach not only mitigates the initial resistance but also helps in embedding reusable packaging as a norm rather than an exception within the supply chain ecosystem. To boost the adoption of reusable packaging, organizations should set clear metrics and KPIs to assess their impact, providing solid, data-backed proof of their benefits. Investing in training and education across all levels of the company can raise awareness of the economic and environmental advantages, fostering a culture that embraces sustainable practices. Managers can also look for ways to collaborate with supply chain partners to share insights and co-create innovative solutions to common challenges. Highlighting potential cost savings, like reduced waste management expenses and lower long-term procurement costs, can make a stronger case for reusable packaging. Additionally, focusing on the positive effects on relationships with stakeholders, such as customers and investors who value sustainability, can further encourage adoption. By implementing these strategies, organizations can not only overcome initial hurdles but also position themselves as sustainability leaders within their industries.

This study contributes significantly to the academic field by providing a nuanced understanding of the barriers and facilitators of reusable packaging adoption in B2B industries. By integrating survey data with in-depth qualitative insights, we offer a comprehensive framework that bridges the gap between theoretical concepts and practical applications. This research extends the current literature by highlighting the importance of industry-specific and cross-industry considerations, thus providing a more detailed analysis than previous studies that often focus on single industries or general sustainability practices. Furthermore, the identification and ranking of policy mechanisms based on business impact and ease of implementation provide actionable insights for policymakers and industry leaders. This practical framework can guide future research to explore the efficacy of these mechanisms in various contexts, thereby fostering a more robust and adaptable understanding of sustainable packaging practices. Our findings also emphasize the need for legislative support and industry collaboration, which can inspire further academic inquiries into the role of policy in driving sustainable practices across different sectors.

In this study, we identified several facilitating policy mechanisms that practitioners can advocate for through their representatives in governments and at industrial conferences to address the core barriers currently preventing the establishment and expansion of reusable packaging systems in the B2B sector. Namely, these are a tax on single-use packaging materials, extension of EPR, carbon pricing, development of industry-wide sustainable packaging standards, interaction with collaborative platforms, establishment of research clusters, tax relief for R&D projects, standardization of operations and packaging, cooperation with leading universities, and risk-sharing mechanisms.

Practitioners, including supply chain managers, sustainability officers, industry trade associations, and policymakers, should focus their efforts on these mechanisms. Supply chain managers and sustainability officers can begin by conducting internal assessments to identify potential areas for implementing reusable packaging and seek collaborations with industry peers through trade associations. Industry trade associations should advocate for the adoption of these policy mechanisms at governmental and international conferences. Policymakers should consider integrating these mechanisms into national and regional sustainability agendas to create a more supportive regulatory environment. Moreover, managers should proactively engage in benchmarking and best practice sharing through such trade associations, creating an environment where lessons learned from early adopters can be rapidly shared and scaled across industries. Engaging with international bodies to establish more uniform global standards for reusable packaging could also standardize practices and reduce variability, making it easier for companies operating across borders to implement and maintain consistent reusable packaging systems.

In ranking these mechanisms in our framework based on their business impact together with their potential ease of implementation, we have created a road map that practitioners can enact to make the environment and legislation more favorable. Naturally, those facilitating mechanisms that can be actioned from within an industry or together with research institutes and universities through collaboration, knowledge sharing, and participation were judged to be easier to implement and more immediately valuable than those that would require advocating for government policy and legislation changes. As we developed the framework, it became apparent that some proposed mechanisms address several barriers simultaneously since many operational and financial challenges are intertwined. The combined benefit of enacting these mechanisms, therefore, affords a greater potential benefit for the development of reusable packaging infrastructure. Such duplicate mechanisms were establishing industry-wide packaging standards (3, 6 & 18); standardization (14 & 17); tax on single-use packaging items (1 & 4); tax relief for R&D projects (12 & 15); and risk-sharing mechanisms (11 & 16).

Industry-wide packaging standards, standardization, and risk-sharing mechanisms all fall into the high impact/high ease of implementation zone, represented by the blue square in our framework chart (Fig. 13). We, therefore, conclude that these are the mechanisms where practitioners should focus their efforts first, offering the greatest potential chance to shift the landscape in favor of the establishment and proliferation of reusable packaging systems for the relatively slightest effort. Supply chain managers and sustainability officers should start by aligning their strategies with these high-priority mechanisms and seek partnerships and funding opportunities to support implementation. Industry trade associations can play a crucial role by setting voluntary standards that can later become mandatory, creating a level playing field. Policymakers should prioritize legislative support for these mechanisms, recognizing their potential to drive significant environmental and economic benefits.

The financial support mechanisms of a tax on single-use packaging items and tax relief for R&D scored highly for potential business impact, making them important policies to advocate for with representatives in government. However, they had comparatively low ease of implementation scores since they require legislative action, which generally takes significant time and political will to pass. These mechanisms can include direct subsidies, grants, and low-interest loans for companies transitioning to sustainable practices. For example, R&D tax credits can provide significant incentives for innovation in reusable packaging technologies, as demonstrated by Bloom et al. (2002). The success of Ireland’s plastic bag levy, which led to a dramatic reduction in plastic bag usage (Convery et al. 2007), illustrates the potential impact of taxation on single-use items. However, since a tax on single-use items is more punitive and tax relief for R&D would be considered a more stimulating measure, there may be a greater likelihood of a tax relief mechanism gaining political traction.

Finally, we have identified several potential directions for the future research outlined below.