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Markets in Transition: Columnist Shifts to Totally Environmental Focus!
The environmental angle has gone to a new level over the last year, and to prove the competitive market really does work, the various products have been all claiming status as members of the ‘E-Team’ in staking out the environmental high ground.

By Rick LeBlanc
Date Posted: 5/1/2008

   Okay, I admit it. The headline is a sham – sort of. Mainly, I’m just green with envy the way some companies are so ingenious about turning their promotional and marketing campaigns into eco-righteous enviro-ganzas.

   The environmental angle has gone to a new level over the last year, and to prove the competitive market really does work, the various products have been all claiming status as members of the ‘E-Team’ in staking out the environmental high ground.

   Check it out.  Here is a comment from the Web site of a leading plastic packaging company:

   “The use of plastic reusable packaging effectively stops waste at the packaging source to prevent the entry of disposable packaging in the solid waste stream. The long service life of reusable containers and pallets allow them to be used over and over again in place of single-use corrugated boxes and limited-use wood pallets. When compared to single-use or disposable packaging, reusable packaging enables significant ‘source reduction.’ ”

   Now, here is what a grocery store chain announced last year about the introduction of corrugated paper pallets into its distribution system:

   “The Whole Foods Market’s Denver Distribution Center is embracing Earth Month by permanently switching from wood pallets to 100% recyclable corrugated pallets:

   • New pallets are made from 70% recycled corrugate and 30% new natural kraft fiber

   • Each corrugated pallet weighs only
8 pounds compared to 60 pounds for wood pallets

   • Wood pallets consume 1,000,000 acres of trees a year.”

   And for metal pallets? Toro Pallets has been particularly bullish on the green aura surrounding its aluminum hybrid pallets:

   “At 40 pounds, Toro Pallets are ultra-light weight and reduce transportation fuel and carbon emissions. In accordance to the EPA-SmartWay (SM) Transportation Program, reducing 1,700 lbs. from a single truck could add up to fuel savings exceeding $850 and reduce carbon emissions by up to 3.5 tons a year.”

   Never fear, wood pallet readers. Life cycle analysis, a well established form of environmental assessment, has positioned wood pallets ahead of other materials.

   Peter Hamner of Virginia Tech, writing in Pallet Enterprise, summarized a European report:

   “The results of this study show that wood pallets offer a considerably more positive environmental image than plastic pallets. For example, the manufacture and use of plastic pallets consumes about five times more energy than wood pallets, according to this study. In terms of LCA, multiple-use wood pallets use considerably less raw material and energy and contribute far less emissions into water and air than plastic pallets. This research provides a strong endorsement for the production and use of wood pallets.”

   In a similar light, a recent comparative analysis at Brown University compared carbon dioxide emissions (CO2) from two types of wood pallets and a plastic pallet:

   “The life-cycle analysis focused on three periods in a pallet’s life, identified as Source, Use and End-Use. The dowel-based pallet emitted the least CO2 (20,000 tons), followed by the nail-based pallet (3,000,000 tons CO2). The HDPE (plastic) pallet was found to emit the most CO2 at 11,000,000 tons.”

   Who is right and who is wrong? To the extent that claims are specific and can be substantiated, everyone can legitimately be on the E-Team. Reusable plastic containers and pallets do cut down source material consumption and waste, as claimed. Aluminum pallets can reduce freight costs compared to heavier pallet alternatives, as claimed. The use of corrugated pallets made from recycled fiber will reduce lumber requirements, as claimed. And indeed, life cycle analysis does support reusable wood pallets as a more positive environmental option.

   The key is substantiating claims. The Federal Trade Commission, in its Guides for the Use of Environmental Marketing Claims, cautions that “…every express and material implied claim that the general assertion conveys to reasonable consumers about an objective quality, feature or attribute of a product or service must be substantiated. Unless this substantiation duty can be met, broad environmental claims should either be avoided or qualified, as necessary, to prevent deception about the specific nature of the environmental benefit being asserted.”

   Deception is a key issue. For example, where claims are made for a multiple use rental pallet versus an expendable pallet or versus a “fungible” pallet, a lot may hinge on assumptions — about how many times the expendable pallet is reused, or the reverse logistics associated with the fungible pallets versus an assumption that 28 empty exchange pallets are ‘dead-headed’ back in a truck to the supplier. There is an obligation to bring those assumptions out in the open in the eyes of the FTC.

   The only false claim made in the examples above was my claim about my new green focus.

   Only time will tell if that one has merit. My main point is this: no matter what pallet you sell, there is an environmental case that can be made in favor of it. The important issue is to be specific and be able to substantiate the claims. Don’t use deception in comparisons with competing products and materials.

   And after that, as usual, it often will come down to price, especially as the soft economy lingers.

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