Loadhog Lids

Source: Stock Market Digital

Date :10/05/2007 17:43:09

Loadhog Lids: Loadhog takes the green initiative

Sheffield based Loadhog Ltd has found an ingenious solution to the problem of plastic waste produced by loading companies. Loadhog’s production director Mark Jackson explains that Loadhog’s products are founded as much on economic imperatives as environmental considerations.

By Felicity Landon with Kiron Chavda

THE UK consumes over 400,000 tonnes of plastic film per year – and over half of that is used to secure loads to pallets. Research shows that about half of this film doesn’t get recycled. Against this background, Loadhog Ltd’s green credentials are clear – the Sheffield based company is championing re-usable and returnable plastic packaging solutions, and major customers are snapping them up.

Two-and-a-half years ago, Loadhog launched its Loadhog Lid, a product that is constructed from moulded polypropylene, specifically designed to secure a level load to any standard wooden or plastic pallet and can be used again and again. So far, so green – but Loadhog says its lids offer more benefits than simply being an alternative to disposable banding, shrink wrap and stretch film.

“It isn’t just the environmental pressures or the cost of materials – our lid offers significant labour benefits,” says Loadhog production director Mark Jackson. “It takes 20 seconds to fit or remove the lid – shrink-wrap can be up to two minutes. The lid is also safer.” Last year (2006), the company sold 26,000 lids – this year it is forecasting double that as more companies pick up the idea.

“I think industry and governments will go more and more towards reusable products and our lid is an exciting product,” he says. “For us, it is about growing volume and becoming an international product. Whether we make all the lids here (in Sheffield) for the international market or licence the product through sale of the bespoke tensioning systems to other manufacturers for use within their own lids is to be decided.”

Major contracts so far have included an order to supply more than 4000 Half-Euro (800 x 600 mm pallet footprint size) lids for Royal Mail. Honda UK has converted its entire UK pallet-based logistics network to use Loadhog Lids; the automotive OEM bought 9,600 lids, to be used by more than 100 of its suppliers throughout the UK and beyond to deliver components to its plant and distribution centre at Swindon.

By working closely with Big Bear Plastic Products in Droitwich, a vacuum forming specialist, the two companies have demonstrated their ability to supply 10,000 bespoke lids to Norway Post. The two companies have worked closely with Posten Norge to develop a purpose designed solution for their new mail system, with a concept design in just three days and full production tooling in 8 weeks.

Loadhog was launched as a subsidiary of Gripple, a £20 million turnover company that specialises in wire joining systems and wire rope solutions. Both companies are chaired by Hugh Facey, but they work in separate markets and premises. Jackson says persuading potential customers of the virtues of the Loadhog Lid isn’t difficult, but translating this into real orders is tougher.

A major commitment

“Packaging just isn’t core in terms of a company’s investment,” he says. “Everyone is very interested in the concept and sees the benefits – but the challenge always comes down to the decision-making process.” And to be fair, it is a major commitment – the Loadhog Lids typically cost £70 to £75 each, so purchasing 10,000 of them isn’t a cheap option. Also, the complexity of some supply chains makes it difficult to adopt a “re-turnable” system, because the lids simply wouldn’t get back to where they were needed.

“You need a clean loop to return them to source, or else a pool system,” says Jackson. “Honda has a very aggressive green policy where it wants to reduce packaging waste to zero by 2010, and our lids obviously facilitate that objective.”

“Other automotive OEMs have tried to get their suppliers to buy the lids but the difficulty is you have dozens of suppliers into the customer and the logistics of returning lids to the right suppliers are very difficult. In the end, the Honda decision came about because the company decided to buy the lids themselves.”

Loadhog operates out of a purpose-designed, environmentally friendly factory in Sheffield. Built on a reclaimed brownfield site, it incorporates a host of environmental features ranging from solar panels to under-floor heating. Rainwater from the roof is stored in a 13,000 litre tank below ground and is used for the internal cooling of the high-tech production, as well as for flushing the lavatories. Building and equipping the plant represented an investment of about £7 million.

Entrepreneurial innovators

The company invested heavily in environmentally friendly processes using a pioneering new technology called MuCell (microcellular foam), buying the biggest machine of its kind in the world. Many of these initiatives could not be justified on pure financial terms, or they have a long payback, says Hugh Facey. “We justified the investment on the grounds of our environmental responsibility and the need to ‘walk the talk’.” However, Loadhog doesn’t see itself as a purely environmental company, “rather as entrepreneurial innovators marketing and manufacturing supply chain solutions with significant environmental benefits."

The Loadhog Lid was the launch product but since then the company has developed further “green” solutions. Smartstak, is a load handling system that was developed as a direct result of an approach from the glass industry. The traditional way of transporting glass bottles – up to 4000 bottles stacked ten-high, divided by plastic sheets, wooden frame on top and banded certainly has its problems. Bottles fall out, and the subsequent cascade effect can lead to the collapse of large parts of the pack during transportation or storage. Breakages are common, and often entire loads have to be rejected by the brewers or bottle fillers because of the possibility of contamination from glass fragments.

The Smartstak system allows safe ten-tier packs, with the potential to go even higher. The system is based on an “intelligent” layer pad and a “live” top frame and eliminates the need for horizontal strapping and shrink wrapping, while reducing the number of vertical straps required. “The two frames are separated by springs, which increases the tension of the bands to spread the load and better secure it,” says Jackson. “The system stops bottles from drifting due to vibration from transport.”

When the Loadhog Lid was first developed, there was no market demand for the concept – only a perceived benefit and a market waiting to be persuaded. Next came the Smartstak as a new solution requested by the glass industry. And this year (2007) comes the “Pally”, a customer-led project due for launch in March/April 2007.

A revolution for the retailer

The Pally is best described as a combination between the dolly – the wheeled trolley used by supermarkets for displaying drinks and other products – and a conventional pallet. The traditional dolly removes the shelf-stacking operation for retailers but cannot be used in a warehouse because it is unsuitable for forklift trucks, roller conveyors and other equipment. “Dollies don’t go down roller conveyors,” says Mr Jackson. “Warehouses like pallets and the retailer doesn’t. So a lot of people are using intermediate packaging houses to transfer goods from pallet to dolly.”

Loadhog has developed a patented product which is essentially a pallet with wheels inside its feet – enabling it to move through the production and logistics process as a pallet, but convert to a dolly type merchandising unit for the last stages of its journey. “It offers a revolution for the retailer in terms of handling because it works equally in store or at the retail front end as it does in production or warehousing activity,” says Jackson.

Loadhog has invested £500,000 in new tooling for production of the Pally, and is predicting “very large” volumes. As well as interest from retailers at home and overseas, postal companies are looking at using the Pally, in particular as a solution for loading air freight.