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Ranpak’s Sustainable Shipping Materials And Packaging Automation Help Companies Win At eCommerce

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There was already robust growth in eCommerce before the pandemic “put it up to 11.” But in a marketplace that simultaneously has fast-burgeoning demands for sustainability, reduction and greening of all the packaging materials involved, doing the shipping part right becomes a critical need for companies to be competitive.

That’s where Ranpak comes in. They provide not just innovative, automated packaging solutions that help solve those challenges, but other benefits as well. With 30,000 users in 50 countries, $300 million in topline sales, and an EBITDA margin of over 30%, they must be doing something right.

Ranpak Holdings Corp. is headquartered in Concord Township, Ohio, just east of Cleveland. It was started as a family business back in 1972, specializing in protective packaging for engines and industrial components. Over the years it evolved into a global supplier of 100% paper-based packaging. For almost two decades, it was owned by different private equity firms, but last year the company’s current CEO, Omar Asali, acquired the business and took it public.

“We saw three areas of opportunity for the company,” said Asali. “eCommerce, sustainability, and automation are all areas of strength for our business. Those tie in well with three trends we continue to see for our customers today even during the pandemic. Growth is the first. It’s like our customers have just had ten Christmases in a row, and eCommerce is rip-roaring. The second is the call for better corporate citizenship, including waste reduction, water conservation, and energy management. And the third is the enormous pressure against plastics, which is something we’re hearing everywhere from boardrooms to warehouses.”

Ranpak offers an interesting mix of mutually beneficial products. For its customers, not only is its entirely paper-based suite of packaging solutions a great answer for plastic elimination, but the company’s Cut’it! EVO automated in-line packaging machine tailor-forms boxes to the sizes of items being shipped, reducing both amount of packaging material required and space in shipment. They offer a wide variety of  void fill, cushioning, and other wrapping products, supporting fully manual work systems while also offering partial- and full-automation packaging machines solutions. What’s more, they offer their machines on-demand, which can be a tremendous customer benefit.

For Ranpak, the benefit is not only the usual straightforward sales dollars. “Our equipment is designed so the only paper that can run in it is Ranpak paper,” explained Asali. “It’s like a razor and razor blade analogy–by offering a superior machine, we’re able to lock in recurring material sales.”

That’s the case for Anthony Antonello, VP of Finance at Misfits Markets, which offers a subscriber box of organic produce and sustainably sourced pantry staples. “Ranpak is a big part of our operations,” he said. “We need to be confident that our grocery boxes are going to reach our customers in good shape.”

Misfits found Ranpak through one of their grocery box subscribers who is a broker for the company. “We were happy to take a look–we liked their sustainability story, being all-paper, and the flexibility they offered for us to get machines where we needed them,” said Antonello. They wound up using three Ranpak machines: Geami, which die-cuts paper and tissue paper for wrapping delicate items; PadPak, which produces kraft dividers; and Trident, which is used to fill the void within a box. “They’ve been a tremendous partner in finding the right fit,” he continued. “They brought their techs in, and they were very hands-on and helped us with the cost analysis.”

The on-demand provision of equipment is a particular benefit for Misfits. “There’s no capital up front–that’s huge for a start-up where cash is paramount,” Antonello explained. “Plus it gives us lots of flexibility to help save operating costs when we need to.”

For Jan Baan, Chief Operating Officer at Omoda, an omni-channel  shoe and accessories retailer based in Zierikzee, the Netherlands, Ranpak’s automation and custom-fit boxes are key benefits. “We started looking at Ranpak a few years ago,” he said. “We were seeing enormous growth in peak demand times and days. And we saw the drive in the marketplace toward sustainability–the younger customer group is very environmentally conscious. But at the time we were sending shoes in boxes that were 50% or 60% air, and manually packaging with over ten different packages.”

Omoda began looking for an automated solution that would reduce the package voids. “We knew of one of Ranpak’s machines at another company and went to look at it, then filled in the contact form on their website,” said Baan. Once they ran the numbers, he says, “it was an easy business case, with a very quick payback.” They started their machine up in the beginning of 2019. “It reduced the air in the package from over 50% to about 20%,” said Baan. “And the machine has a huge peak performance–it can do 900 packages per hour.” That helped solve the company’s demand spike problems. “Ranpak helped us scale up our business further, both in terms of efficiency and our environmental footprint,” he added. “We couldn’t have gotten where we are today without them.”

Asali sees more opportunity for the future. “Right now cold chain products rely on Styrofoam,” he said. “We’re at the forefront of offering a fiber-based, biodegradable solution, or at least one that’s curbside-recyclable. Customers would get the same protection at a lower price that’s eco-friendly.” Of course, the continued growth of eCommerce means more opportunities as well.

Meanwhile, Ranpak is focused on other aspects of the future. “If you look at the last two decades, there’s been a lot of disruption in the business world,” said Asali. “eCommerce versus bricks and mortar, streaming versus legacy media, telecommunications breakthroughs. Now we’re starting to see tech guys disrupting the industrial space, like Tesla versus the legacy auto industry. We’re already in automation and robotics, and we’re exploring how we can use AI and machine learning. We want to position ourselves not to be disrupted.”

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