Canadian companies piloting sustainable cannabis packaging service

A circular cannabis shipping case from Apical Ethical Cannabis Collective and Friendlier is meant to be reused multiple times. (Photo courtesy of Apical)

A Canadian consultancy is piloting an environmentally friendly cannabis packaging service with an eye to reducing waste by reusing wholesale packaging many times instead of recycling or throwing it away.

Unlike many other green cannabis packaging initiatives, the reusable, or circular, master pack prototype from Apical Ethical Cannabis Collective – an environmental, social and governance (ESG) consultancy – involves packaging for wholesale shipments from producers to distributors or stores.

Looking ahead, Apical CEO Mika Unterman aspires to reusable consumer cannabis packaging.

“I think reuse can be implemented and be profitable and be successful at both levels of the supply chain,” she told MJBizDaily.

Unterman said starting with business-to-business packaging is a lower-risk way to test collection and reuse infrastructure and the associated costs, since Canadian consumer cannabis packaging is subject to significant regulatory requirements.

Pilot project launched

The circular master pack works as a so-called product-as-a-service, applying a scannable QR code to corrugated cardboard shipping cases.

Retailers scan the code to schedule a pickup of empty packaging cases.

The packaging can then be reused – up to 12 times, according to Unterman – until it’s worn out and needs to be recycled.

“The financial feasibility is based on a very conservative model of only four uses,” she said.

On top of reducing waste, Unterman said the reusable master pack can:

• Reduce producers’ packaging costs compared to single-use packaging.
• Provide useful data via the scannable code on retail product distribution such as “how long it takes to deplete a specific amount of inventory.”

“Even though the master packs right now are not terribly exciting in terms of visibility to the consumer, it is the first step into a reuse economy, or a circular economy, where our goal is not to figure out what to do with our waste but eliminate it altogether,” Unterman said.

To manage logistics, Apical has partnered with Ontario company Friendlier, which provides reusable takeout containers – and the infrastructure to reuse them – to food-service businesses.

Apical and Friendlier launched the pilot project in Ontario, and three cannabis producers are participating so far.

The pilot project for wholesale shipments “allows us to test that infrastructure before we pivot and launch into consumer plastics, which is where the real game-changing applications are,” Unterman explained.

Specifically, she said the pilot aims to answer several questions:

• “What is the return rate from the retailer – how easy is it for us to get them engaged and part of the return process?”
• “What is the life span of a low-value asset, meaning, how many times can we reuse the corrugated cardboard currently in circulation?”
• “And then, based on those two things, what is the (return on investment)? How much money can we be saving (licensed producers) by reusing their packaging?”

Unterman believes reusable cannabis shipper packaging has not been done in the U.S. or Canada before.

“In Europe, it’s a little bit more established, in that reuse – especially at the shipper level – is done pretty commonly,” she said.

Apical and Friendlier’s prototype collaboration has received a 20,000 Canadian dollar ($14,500) grant from the Circular Opportunity Innovation Launchpad, a business accelerator funded by the regional development agency Federal Economic Development Agency for Southern Ontario.

Apical has applied for more funding.

Circular consumer packaging more complex

Jacob Policzer is director of science and strategy at cannabis industry sustainability standards certification company The Cannabis Conservancy, which is unaffiliated with Apical’s circular packaging project.

Policzer told MJBizDaily he knows of a smaller-scale circular packaging initiative by a company that incentivizes customers to return containers for reuse.

But a circular packaging service for multiple companies overseen by a third party “is definitely new in the cannabis industry.”

He said many cannabis companies focus on sourcing environmentally friendlier packaging materials “because it’s an easier win, and you don’t have to worry about the logistics of collecting, inspecting, sanitizing, cleaning, getting it back in there.”

“Ocean plastic is better than regular plastic, or post-consumer material is better than virgin material,” Policzer explained.

“But it’s also going to be ending up in the landfill or the recycler, whereas (circular packaging) is trying to keep it out of that process.”

Policzer said he supports Apical’s circular packaging concept, although he has some questions about how the business-to-business packaging might work, including:

• Whether the same boxes can be used to ship differently sized cannabis product packages
• How well the system can accommodate seasonal demand spikes around events such as 4/20.

Policzer believes achieving a circular cannabis packaging economy for consumer packaging would require some “education and behavioral transition” for consumers accustomed to convenience.

“Having people collect it and either send it back or return it somewhere, I think is going to be the hardest lift for consumer involvement,” he said.

Reducing producers’ environmental footprint

Nova Scotia cannabis producer Aqualitas already uses various kinds of sustainable packaging for its consumer products, including ocean-sourced reclaimed plastic.

The aquaponic grower is participating in Apical’s pilot project for its adult-use shipments to Ontario, and Aqualitas CEO and co-founder Myrna Gillis told MJBizDaily that its first shipment of more than 200 reusable cases has already arrived in Ontario.

“A big part of our brand promise is that we are a company that is sustainable and renewable and tries to support the full circle in how we produce, but also in how we get the product to the consumer,” Gillis said.

The data-collection aspect of the circular packaging program is not the only way for cannabis producers to track shipments to stores, Gillis added.

For example, she said Aqualitas researches retail websites to see who’s carrying their products and then gets data from the Ontario wholesaler.

“But this is another opportunity to engage with retailers and know where your product is and how quickly it’s moving through the stores.”

Ontario grower Carmel Cannabis is also focused on sustainable consumer packaging, using post-consumer recycled mylar pouches and packing pre-rolls in recyclable glass tubes with cork tops, said founder Roey Fishman.

“When we heard that this could be an idea to reduce our overall footprint – not just obviously for the customers but just holistically as a business – we thought it was a great idea,” he said.

Fishman said Carmel’s existing branded shipping cases “didn’t exactly fit with what was proposed (by Apical),” but Unterman found a way to use the company’s current cases.

“In the pilot project, something that’s really interesting to us is to see how many times we can use one master case over and over again,” he said.

Shipping cases are not “a significant cost contributor” for Carmel, Fishman added.

“So, for us, this initiative was really about trying to find any way possible to reduce our footprint,” he said.

“And also to participate as much as we can in a circular economy, which in our industry has proven quite difficult overall.”

Source: https://mjbizdaily.com/canadian-companies-piloting-sustainable-cannabis-packaging-service/