www.aqueduct-h2o.com Bag in Box: November 2010

The 10 Environmental benefits of Bag in Box

Kieran Mckenna, MD of Aqueduct – Purity by Design” water coolers on the TEN Environmental advantages of Bag in Box water.

How has Environmental issues affected the “Bag in Box” (BIB) and Home Office Delivered (HOD) bottle business?…….These is no doubt that environmental pressures are now hitting the water industry and having a hugely negative impact on the bulk HOD market as a spin off from the poor image of the small PET Bottle. Unfortunately all water is getting tarred with the same brush. Paradoxically the 5 gallon HOD business is very good at recycling its PET plastic and most companies have a high rate of bottle recycling…. With bottles being used up to 50 times before being retired. So there is no question that on this score the 5 gallon HOD model is environmentally friendly.

My issue is more with the logistics efficiency – or lack of it – involved with the returnable 5 Gallon bottle.

My reasons are as follows….

FIRSTLY a typical 5 Gallon water plant can only cover a geographic radius of about 150 miles….above this the distance and cost of the empty bottle return journey becomes prohibitive. A decade ago we had never heard of food miles or water miles….but now it is common parlance. Hence the return of a truck with empty bottles is effectively increasing your “road miles” by 50%.

Now some have said to me that a truck always has to return empty to refill – so it makes no difference! I on the other hand looked at a country with a large Geographic land mass (we took the East Coast of the USA as an example – but equally relevant to many European Countries). We nominally placed a BIB water plant in Pittsburgh and then we placed sub distribution warehouses in numerous US Cities from Chicago, New York, Boston etc ….down to the Carolinas and up to the Canadian border. We then estimated the growth of water demand if we put out 4000 coolers in each city and plotted the water requirement over the course of a number of years. We then got DHL / UPS and others to quote for shipments of water – on a one way delivery (and the truck went on to pick up Beds for all we cared!). We were over 5 years out and we had still not come to the point of building a second water plant!! No trucks returned empty.

This is the key advantage of Bag in Box – very efficient logistics. We have a greater geographic reach from one plant.

This brings me to our SECOND key advantage ….we have a smaller more efficient plant (our goods inwards is a fraction of the size of a bottle cooler plant – as 2500 bags are in one box and the boxes are flat packed on a few pallets) and our goods outwards are at least 33% more efficient. One BIB plant could cover an area that would require 4-5 times as many bottle plants. The bigger the country and more difficult the logistics the more BIB comes to the fore.

Our THIRD advantage is that our delivery vans can be smaller and more compact as we can store and move just under one ton on a single pallet. Clearly the limiting factor in movement of water is the maximum weight on the roads (26 Tons in Europe and 18 tons in the USA) but the real advantage is in shrinking the length and height of the truck – having a smaller wheel base that can take the weight. The end result is a leaner and greener fleet . But the real advantage here is not the Green issue but the fact that smaller trucks are easier to park – so fewer clamping fines, fewer parking tickets and more efficient deliveries…. Not to mention lower fuel and fleet maintenance costs.

OurFOURTH advantage is that our packaging is fully recyclable. For example if one looks at the major European Bag in Box websites – and I will plug our two major packaging partners here – Smurfit Kappa and RAPAK…. They have whole sections on their environmental credentials.

Clearly BIB is used once and then discarded. This is like many other food products and is not environmentally negative – provided the Board and liner can be recycled… which they can. Indeed in London the “virgin” Kraft board that is used in the box is such a valuable commodity that it is back out as usable board within one week of hitting the paper recycling centres. Likewise the small amount of plastic used can be recycled if the recycling centres have the ability to crush and separate plastics but in most cases it is used in energy production as it has a very high energy recovery coefficient.

It is a verifiable fact that the major paper manufacturers in BIB plant more trees than they harvest so in a sense the more we utilise the BIB system the more CO2 we trap from the atmosphere by promoting the planting of CO2 harvesting forests!!

Our FIFTH advantage is that we can do more with less trucks….simply because we can deliver a bigger delivery size into the customer….as we can store 4 boxes of water WITHIN the cooler and its easy to store another 8 or 12 neatly out of sight in a cupboard. This is the key MONEY driver also – as you can literally cut out the cost of 50% of your deliveries and reduce the number of empty back and forth small truck movements.

Our SIXTH environmental advantage is that our Bag in Box systems – both the packaging (which was developed initially for milk) and our coolers do not require ANY sanitising visits. You totally eliminate the costly, time consuming, heartbreakingly difficult to keep on top of and microbiologically necessary 13 week sanitising visits. No more chemicals, no more call backs for “funny taste” post sanitisation visits (when the coolers have not been properly flushed through) and you can keep the BIB cooler on your books as an asset by charging a good rental on the machine as against charging a sanitising charge and that is just eaten up in labour and administration charges. What is more as the Scottish Fountain report showed the sanitisation of coolers is a losing battle and 40% of the coolers tested failed due to bacteriological issues….including Coliforms and Staphlococcus aureus!!

Our coolers are designed to be hygienic ALL the time – not just directly after a sanitising visit… hence our tagline “Purity by Design”.

Our SEVENTH environmental advantage is that our coolers utilise the latest R600 Environmentally friendly gas…. And to date I have only come across the lovely Blue Pura coolers that do so as well – so we are well ahead on that criteria.

Our EIGTH and final environmental advantage is that our systems now incorporate a “sleep mode” which dramatically reduces the electrical consumption in the units by up to 25%.... offering customers a real and tangible benefit that is both environmental and monetary.

The NINTH reason is that we do not have to waste water and administer environmentally harsh chemicals to clean the bottles between use. It is a known fact that vigorous cleaning is required between use as the bottles have been exposed to all forms of environmental or human induced (either accidently or intentionally) contamination. Our product is “virgin” with a single use tamper evident system of dispense.

The TENTH and final reason is that – very importantly – our BIB coolers do not have any of the dangerous chemical that is causing such a stir in the plastics industry – “Bisphenol A” or BPA. This chemical was initially thought to be stable in plastic bottles – but then was found to leach if the bottle was exposed to heat (microwaveable baby bottles were first to feel the effects – but now it has moved into the wider plastics debate – as it has proven harmful effects to humans – the only question is “at what level is it safe” – not “does it leach” – it does!! What our industry seems to miss is that people who drink water do so for health and hydration reasons and do not want to engage in the scientific debate of “at what level is it safe” – they just would prefer to drink water that does not have it FULL STOP.

So when I look at the industry and project forward five years I see an industry greatly changed by environmental factors….with Point of Use coolers having fundamentally changed the “heavy use” segment of the current HOD business model and Bag in Box having changed the rest.

So if the question was - How has Environmental issues affected the Bag in Box and HOD bottle business? My answer is that it has completely changed the nature of the HOD business model and will continue to do so at an increasing pace.