Atlanta and Charlotte
UPS (NYSE:UPS) and Sealed Air Corporation (NYSE:SEE) today announced the opening of a Packaging Innovation Center in Louisville, Kentucky on the UPS Supply Chain Solutions campus, near the Worldport® facility, which is the UPS Air Group’s global headquarters. The center will help solve the packaging and shipping challenges of e-commerce retailers, and companies in many other industries, by maximizing efficiency, minimizing waste, reducing shipping costs, and increasing brand affinity.
This is the next step in a strategic partnership between the two companies announced in November 2016 designed to help businesses prepare for the future of supply chains, fulfillment, and packaging to enable global e-commerce success.
“One of the biggest challenges UPS customers have with e-commerce, and across other industry segments, is that they struggle to create efficiencies and enhance profit margins while still improving consumers’ perception of their brand,” said Alan Gershenhorn, Executive Vice President and Chief Commercial Officer, UPS. “UPS customers don’t just need supply chain innovation. They also need packaging innovation. Our partnership with Sealed Air, and the new Packaging Innovation Center, will allow UPS to bring a more complete set of solutions as we help customers re-imagine their entire supply chains, including packaging.”
Brick-and-mortar supply chains have been designed to move in a linear fashion with standard-sized packaging sent from a supplier to a warehouse. From the warehouse, products are sent to a store, where they are unboxed and placed on shelves. In this model, consumers never see secondary or tertiary packaging. In the new e-commerce world, everything is upended and consumers now see, touch and need to dispose of packaging on a more regular basis. As a result, what consumers think about a brand increasingly starts with their experience with a product’s packaging.
“The at-home delivery experience is more important than it has ever been. Consumer expectations for fast, free, on-time delivery leave businesses and retailers with very little room for error,” said Jerome Peribere, President and Chief Executive Officer of Sealed Air. “The partnership between Sealed Air and UPS allows us to combine our decades of expertise and innovation to help our customers create those exceptional delivery experiences from the point of manufacturing all the way through to the last moment of truth in front of the consumer.”
E-commerce sales between 2015 and 2020 are expected to grow a cumulative 128.9 percent. Worldwide retail e-commerce sales are projected to top $4 trillion by 2020, according to eMarketer.¹ At the same time, the change in dynamics with e-commerce logistics and packaging are creating big opportunities to drive new efficiencies. Some of these areas of opportunity include:
- A need for packaging innovation due to inefficient use of labor resources
- Excessive waste of packaging materials
- Keeping costs down and customer satisfaction up despite increasing complexity
- A need for three times the logistics space compared with brick-and-mortar operations²
- Vast proliferation in the number of ways that fulfillment gets done
- Increased pressure on existing labor resources to produce more, at higher speeds and lower costs, in more complex operational environments
- Eliminating the risk of damage and spoilage
- Deploying automation solutions that can not only scale up, but can also scale back down when needed
The partnership between UPS and Sealed Air is designed to help customers in each of these areas, and more. Occupying 6,000 square feet in the UPS Supply Chain Solutions facility, the Packaging Innovation Center houses a wide array of Sealed Air’s cutting-edge packaging solutions.
The selection of packaging technology on display includes an automated system that eliminates the need for outer cartons, which can reduce dimensional weight by as much as 87 percent; an automated right-sizing system that eliminates empty void space in each box by as much as 60 percent; and a portfolio of packaging work-cell solutions that improve labor productivity, reduce product damage, and create a consistent, enhanced experience for the end consumer.
UPS and Sealed Air will also use the Packaging Innovation Center to provide consulting services, including package performance analysis to ensure that companies are using the minimum amount of packaging needed to achieve maximum product protection. Customers can schedule meetings at the center to see the solutions in action and request a packaging analysis based on their specific e-commerce business needs and goals.
As part of the partnership with UPS, Sealed Air is participating in the UPS Customer Technology Program (CTP), providing packaging systems and materials. CTP is a customer loyalty program that connects businesses with best-in-class vendors of hardware, software, peripherals – and now packaging – to help them gain efficiencies across their business and enable growth.
In addition to this partnership, UPS also provides solutions to customers using its Package Design and Test Lab, helping protect packages before they ship. With high tech equipment that creates varying levels of temperature, air pressure, shock, compression and vibration, the lab can simulate moving a package throughout an entire supply chain. These real world experiences provide valuable data that helps UPS custom-design solutions for specific packaging needs. Testing is a compliment to the innovative packaging options that are offered through the Sealed Air / UPS partnership.
1. E-Marketer, (Aug. 2016) “Retail E-Commerce Sales World Wide 2015-2020” https://www.emarketer.com/Article/Worldwide-Retail-Ecommerce-Sales-Will-Reach-1915-Trillion-This-Year/1014369
2. Prologis Research, (Sept. 2016) “Global E-Commerce Impact on Logistics Real Estate” https://www.prologis.com/logistics-industry-research/global-e-commerce-impact-logistics-real-estate
UPS (NYSE: UPS) is a global leader in logistics, offering a broad range of solutions including transporting packages and freight; facilitating international trade, and deploying advanced technology to more efficiently manage the world of business. Headquartered in Atlanta, UPS serves more than 220 countries and territories worldwide. The company can be found on the web at ups.com and its corporate blog can be found at longitudes.ups.com. To get UPS news direct, visit pressroom.ups.com/RSS or follow @UPS_News
About Sealed Air
Sealed Air Corporation creates a world that feels, tastes and works better. In 2016, the Company generated revenue of approximately $6.8 billion by helping our customers achieve their sustainability goals in the face of today’s biggest social and environmental challenges. Our portfolio of widely recognized brands, including Cryovac® brand food packaging solutions, Bubble Wrap® brand cushioning and Diversey® cleaning and hygiene solutions, enables a safer and less wasteful food supply chain, protects valuable goods shipped around the world, and improves health through clean environments. Sealed Air has approximately 23,000 employees who serve customers in 171 countries. To learn more, visit www.sealedair.com.
Sealed Air Forward-Looking Statements
This press release contains “forward-looking statements” within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 concerning our business, consolidated financial condition and results of operations. Forward-looking statements are subject to risks and uncertainties, many of which are outside our control, which could cause actual results to differ materially from these statements. Therefore, you should not rely on any of these forward-looking statements. Forward-looking statements can be identified by such words as “anticipates,” “believes,” “plan,” “assumes,” “could,” “should,” “estimates,” “expects,” “intends,” “potential,” “seek,” “predict,” “may,” “will” and similar references to future periods. All statements other than statements of historical facts included in this press release regarding our strategies, prospects, financial condition, operations, costs, plans and objectives are forward-looking statements. Examples of forward-looking statements include, among others, statements we make regarding expected future operating results, expectations regarding the results of restructuring and other programs, anticipated levels of capital expenditures and expectations of the effect on our financial condition of claims, litigation, environmental costs, contingent liabilities and governmental and regulatory investigations and proceedings. The following are important factors that we believe could cause actual results to differ materially from those in our forward looking statements: the tax benefits associated with the Settlement agreement (as defined in our 2016 Annual Report on Form 10-K), global economic and political conditions, changes in our credit ratings, changes in raw material pricing and availability, changes in energy costs, competitive conditions, the success of the divestiture of the Diversey Care division and related food hygiene and cleaning business, the success of our restructuring activities, currency translation and devaluation effects, the success of our financial growth, profitability, cash generation and manufacturing strategies and our cost reduction and productivity efforts, the success of new product offerings, the effects of animal and food-related health issues, pandemics, consumer preferences, environmental matters, regulatory actions and legal matters, and the other information referenced in the “Risk Factors” section appearing in our most recent Annual Report on Form 10-K, as filed with the Securities and Exchange Commission, and as revised and updated by our Quarterly Reports on Form 10-Q and Current Reports on Form 8-K. Any forward-looking statement made by us is based only on information currently available to us and speaks only as of the date on which it is made. We undertake no obligation to publicly update any forward looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise.
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