Cardboard tray system slashes bakers' costs and could reduce retail bread prices

By Oliver Nieburg contact

- Last updated on GMT

Out of the Box: Cardboard system can cut costs of plastic trays for bakers
Out of the Box: Cardboard system can cut costs of plastic trays for bakers

Related tags: Bread

Replacing plastic trays with a cardboard system could allow US retailers to slash US bread prices while maintaining profit margins and lowering costs for manufacturers, says the maker of the new method Out of the Box.

The Toronto-based firm introduced its retail-ready corrugated trays to replace plastic trays in November last year. It claims the system is friendlier to the environment and will cut costs for bakers.

The plastic tray system

Co-inventor of the system Mike Juma, who previously owned a commercial bakery with his brother, told it could replace the expensive and inefficient plastic tray system.

“Traditionally, bread until today is delivered on plastic trays. The tray only serves the purpose of taking the bread to the distribution center. There’s no value to this tray other than transportation.”

Packaged bread is fed onto plastic trays, costing $15-20 each, and manufacturers pay for freight and storage.

“In Canada and the US, the tray must go through a wash cycle each time it goes back,”​ said Juma. “This is why bread in North America is selling for $3.”

He said plastic trays were adding almost 4% to the price of each loaf of bread sold in retailers.

Cost savings

Juma said that the OTB system would increase a bakery’s margin on every loaf of bread at no added cost.

“The truck never comes back to the bakery so our distribution costs are cut in half immediately, ​he said.

The OTB cardboard system also carries almost double the amount of loaves per palette compared to a plastic tray meaning fuel costs are cut even further.

otb truck
More loaves per truckload, says Out of the Box

Competitive bread prices

“These savings could be passed on to consumers,”​ said Juma. “Retailers are competitive on the price of staple items like sugar, milk and bananas, but not on bread.”

He said the OTB system would allow retailers to sell a loaf of white bread for $1.49 instead of $3 and maintain or even grow profit margins.

Green system and pros

The cardboard trays are completely recyclable and are compatible with automatic tray formers and box folding equipment, but Juma said some minor adjustment may be required.

“The entire process can be automated to fit an automatic commercial bakery,” ​he said.

The inventor added the OTB system could withstand 1,995 llbs per sq inch and could protect the product. The cardboard trays are also shrink-wrapped for further reinforcement.

Juma said retailers could stack the OTB trays on palettes at whatever height they required. Retailers may also encourage customers to pack their shopping in the empty trays, he said.

Juma and his brother were previously using the system for their commercial bakery. It took OTB six years to finalize a patent for the U.S and Canada and the firm began to sell to these markets in November 2014.

The firm has applied for patent protection across the globe. Juma said his firm was open to negotiating a license for a cardboard manufacturer in Europe to bring the system to the continent.

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