Wal-Mart gets tough on wrap

By early 2008

As part of Wal-Mart’s (NYSE: WMT) “Embrace the Earth” campaign, the company announced Sept. 22 that it would reduce overall packaging by 5 percent, starting in 2008. The announcement came on the third day of the Clinton Global Initiative, an annual conference hosted by former President Clinton that drew business, political and nonprofit leaders.

Ranked second among Fortune 500 companies for annual revenue, Wal-Mart plans to work with its 6000,000 global suppliers to meet its goal. The company estimates a 5 percent reduction in packaging will keep 667,000 metric tons of carbon dioxide from entering the atmosphere and save Wal-Mart and its suppliers a combined $11 billion.

“When you bring the capabilities of the entire supply chain together, the ability to make a difference really pops,” said H. Lee Scott, Wal-Mart CEO. “There’s a multiplier effect.  Instead of just looking at what Wal-Mart can do alone, we have the opportunity to inspire thousands of companies and millions of customers as well.”

This November, Wal-Mart plans to introduce a packaging scorecard to more than 2,000 private label suppliers. By February 2007, tools and processes for packaging reduction are expected to be made available to all of the company’s global suppliers attempting to meet Wal-Mart’s 5 percent reduction goal. By early 2008, the packaging scorecard could allow Wal-Mart’s 176 million weekly customers to access information about packaging.

Wal-Mart’s packaging vision started last year when the company partnered with suppliers to improve packaging on its private label Kid Connection toy line. By reducing the packaging on about 300 toys, Wal-Mart estimates that in one year alone it saved 3,425 tons of corrugated materials, 1,358 barrels of oil, 727 shipping containers and $3.5 million in transportation costs.