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The Grocery Manufacturers Association (GMA) and the Food Marketing Institute (FMI) have recognized four industry initiatives that have successfully addressed the challenge of reducing unsaleable costs.

The 2005 Innovation Awards, sponsored by GMA and FMI, were awarded to:

  • Campbell Soup Company and Food Lion for working together to identify a secondary packaging flaw in V8 and Tomato Juice packages in a matter of 15 days, resulting in a long-term solution for the entire supply chain.

  • Kellogg USA for creating an innovative system that delivered a 75 percent reduction in damage related to Morning Food products over a five-year period.

  • Land O’Lakes, Inc. for reducing overall unsaleable percent to sales below 1 percent over a three-year period.

  • MeadWestvaco Coated Board for taking steps to reduce damaged goods by evaluating paperboard compression and choosing paperboard substrate, which ultimately reduced unsaleables by 20 percent to 30 percent.

“The winners of the Innovation Award clearly showcased dynamic solutions for reducing the costs associated with unsaleable products. The goals achieved by these companies can serve as models for others in the industry,” said GMA’s Senior Director of Industry Affairs Karin Croft.

“We are very pleased to recognize the outstanding accomplishments made by each of these companies,” said Patrick Walsh, senior director, industry relations, FMI. “Their innovative initiatives provide excellent examples of how collaborative efforts can significantly reduce unsaleables losses and improve operating efficiency across the board.”

The awards came as the “2005 Unsaleables Benchmark Report,” sponsored by GMA and FMI, was released yesterday at the Joint Industry Unsaleables Management Conference in Vancouver, British Columbia. This report said that the cost of unsaleables declined last year to 1.06% of sales for the average CPG manufacturer, and that the total industry cost of unsaleables last year was $2.52 billion.
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