Why Sustainable Food Packaging is Good for Business

Why Sustainable Food Packaging is Good for Business
From minimizing packaging to asking your diners to opt into using less plastic, here are the ways you can balance cost and demand challenges to incorporate more eco-friendly strategies.
by Stephanie Vozza May 24, 2021 — 4 min read
Why Sustainable Food Packaging is Good for Business

Takeout and delivery are booming, especially with the closing of indoor and outdoor dining in some states, but so is single-use packaging. While many restaurants already offer takeout, an increase in demand has driven up costs for business owners who must invest in more supplies to keep pace.

Some sustainability initiatives were put on pause in 2020 due to the COVID-19 pandemic as the need for sanitary, disposable containers led to an uptick in single-use plastics. The change in attitude toward plastic use was especially apparent in the restaurant space, as businesses competed for limited resources. 

Disposable packaging creates sustainability challenges for business owners trying to reduce their carbon footprint. Now, it is also an increasingly expensive line item on their weekly budgets. As restaurant owners work hard to stay afloat, they also have to balance their concerns about cost and the environment with consumer demand for more sustainable — and affordable — choices when ordering out. 

Meeting the increased takeout volume, maintaining a profit margin, and working toward a more sustainable business model don’t have to be competing goals. From minimizing packaging to asking your diners to opt into using less plastic, there are several solutions that balance cost and demand challenges with more eco-friendly strategies.

Plastic packaging vs. eco-friendly packaging

Both plastic packaging and more sustainable alternatives come with their own challenges, risks, and costs. For the former, its environmental impact is a well-documented concern.

Plastic packaging generates approximately 35.7 million tons of waste in the U.S., but just 8.5% is recycled, according to the U.S. Environmental Protection Agency. According to the Green Dining Alliance, Styrofoam, commonly used in takeout packaging, takes 500 years to decompose.

But when it comes to proper food handling, plastic still meets those needs better than more eco-friendly materials. It’s challenging to create eco-friendly packaging that can keep products fresh and endure temperature requirements. Food Dive reports that the materials tend to be less effective since plastic has a tighter seal and can keep out air better than other materials. It’s also hard to get an eco-friendly material that holds water, is not plastic, and doesn’t degrade, which is necessary for use in a microwave. 

The rising financial cost of plastic packaging

Single-use and takeout containers have had a financial impact on restaurants that are already struggling. Packaging costs have gone up due to increased demand from businesses during COVID-19, says Square seller Andrés Ozuna, owner of Wooden Table Baking Co., an all-natural bakery based out of Oakland, Calif. 

“It’s not only that the price increased,” he says, “it’s also unavailable sometimes because everybody is sending packages. There is no tape, no boxes. It creates stress as well as the increase in prices.”

Some restaurants are tacking on COVID-19 carryout surcharges to deal with the increase in costs, but the idea has received a mixed reaction from diners. Restaurant Business reports that only 31% of consumers find a coronavirus surcharge acceptable, while 38% agree that it’s reasonable for restaurants to raise their menu prices for added COVID-19-associated costs. 

Promoting your values to customers through packaging

Advertising a move toward sustainable packaging has a long-term benefit when it comes to customer loyalty. Customers are looking for companies that care about the environment, and 88% want companies to help them make a difference, including sustainability efforts, according to a survey by Futerra

While some restaurants were moving toward greater use of reusable containers, disposable packaging is currently assumed to be a safer choice for health reasons. For example, Blue Bottle, a network of more than 100 coffee cafés in the U.S., Japan, and Korea, has plans to roll out a reusable-only policy, but has had to slow down plans due to the pandemic.

But eco-friendly replacements can also be pricey. Sustainable options cost about 25% more to produce compared to traditional packaging, reports Food Dive. However, a study from the National Restaurant Association found that 45% of customers rank environmentally friendly packaging as important. And research from Nielsen shows two-thirds of consumers will pay more for products from brands committed to environmentally friendly practices.

If you increase prices to cover the cost, be sure to promote the fact that your containers are eco-friendly so customers understand the eco-driven reasoning behind the price increase.

Alternative solutions to plastic packaging

When social distancing needs fade and in-person activities resume, demand for single-use containers will likely start to decline again. In the meantime, there are steps cost-conscious, sustainability-minded restaurant owners can do today to help address the challenges

Opt for compostable materials

Look for compostable or disposable packaging made with high post-consumer waste alternatives. For example, packaging products such as the Bio Natura Foopak solution from Asia Pulp & Paper are recyclable and compostable within 12 weeks. Other options include packaging made from sugarcane and bioplastics.

Simplify your packaging

Minimize packaging where you can, such as asking customers to opt in to plastic utensils. CNBC reports that the fresh food restaurant chain Just Salad implemented this change to its online-ordering platform and reduced utensil use on those orders by 88%. And delivery services like Uber Eats and Grubhub allow patrons to opt out of single-use plastic utensils as well.

Adopt a sustainability mindset beyond packaging

For some businesses, plastic disposable containers are what is currently feasible given cost and time constraints. But there are other ways to offset your carbon footprint.

According to the National Restaurant Association, just 14% of restaurants have a compost program. If you aren’t currently composting scraps and waste, now is an excellent time to start a program or look for an organization that will do it for you. For example, Blue Bottle donates used coffee grounds to Frog Hollow Farms to encourage sustainable agriculture. 

And make sure you’re exhausting all recycling options. For example, you can recycle disposable masks and gloves through Terracycle, a New Jersey-based recycler that turns non-recyclable waste into raw materials for manufacturers. You could also dispose of used cooking oil by asking your supplier if they offer a recycling service or by contacting your city’s sanitation department and requesting information on oil recycling companies in your area.

Fast-casual restaurant owners can set up recycling centers inside their locations so that customers can sort and recycle materials, such as paper and plastic. According to ecoCycle, 85% of consumers who dine at limited-service restaurants say they will sort recyclables if receptacles are provided.

Looking ahead

While navigating the new business procedures brought about by the pandemic is challenging, it’s also essential. Consumers are paying close attention to the behaviors and practices of the businesses they patronize, especially the brands they trust to feed their families. Sustainability, safety, accessibility, attention to detail, and quality are critical considerations as shoppers adjust their day-to-day purchasing decisions.

The steps you take today may create a loyal customer tomorrow while improving how you operate. 

Stephanie Vozza
Stephanie Vozza is an experienced writer who specializes in small business and retail. She has been a regular columnist for FastCompany.com for five years, and her byline has appeared in Inc., Entrepreneur, and Parade.


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