Debates surrounding the logistics of zero-waste beauty have been ongoing. While some brands have achieved such status, others are still working towards their zero-waste goals or finding different ways to invest in sustainability through their brand. According to The Missing Billions: The Real Cost of Supply Chain Waste, a report by Avery Dennison, over 10% of beauty and personal care products go to waste. Of this 10%, 4% is due to the product being damaged or unfit for sale, and 6.2% is due to overproduction. This total accounts for 2.8% of annual profits being lost, which is estimated to amount to $4.8B overall. The study analyzed 61 global beauty and personal care firms across the US, UK, France, and China, including manufacturers, wholesalers, distribution firms, and retailers. Here are the key findings from the report:
Areas of Supply Chain Improvement
Eduardo Kawano, Digital Transformation and Supply Chain Senior Manager at Grupo Boticário, who was interviewed as part of the report, comments, "A key challenge for the industry is product expiry while on the shelf leading to wasted inventory. We have addressed this by adopting RFID, and a 'first expired, first out' model which ensures the products with the shortest shelf life are positioned at the front of store and sold first. This is crucial to help us reduce waste and help our sustainability goals."
Francisco Melo, Senior Vice President and General Manager at Avery Dennison, adds: "The current supply chain disruption is leading to a waste crisis in the beauty industry and elsewhere. Having visibility is key to optimizing supply chains for efficiency and sustainability, as well as helping to build trust and transparency with consumers. Digital identification solutions play a vital role in supply chain planning strategy, and it is encouraging to see that companies are committed to further drive this change through the increased use of RFID technology in the coming years.”
The report also collected data from 7,500 shoppers globally to understand consumer spending shifts. Given the current economic turbulence, purchasing cost-efficient yet reliable products became more important, but the economic impact of these buys still remains a substantial factor.
With the beauty industry being the biggest contributor to product waste, it is clear changes need to be made by both brands and consumers alike. While the finger is usually pointed towards packaging waste, the report shows that there is more to the problem, and supply chains hold heavy weight when it comes to sustainability issues. For customers, ensuring the ethical production of their purchases, even when being mindful of cost, will encourage more brands to dive deeper into their sourcing and production process to keep their consumers' needs met.
It can be concluded that the best way to tackle these issues in the future is to be more transparent with consumers and invest more time, money, and effort into advanced technologies such as RFID to maximize supply chain sustainability benefits. There is strong evidence that brands intend to crack down on their wastage issues, using different methods of tracking and delivery to combat current problems, which will eventually result in being able to be more honest with consumers about product journeys.
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