Welcome to numero 50! This newsletter started out on a whim at the beginning of the pandemic and has been a joy to write. Hopefully, it provides you with some thought-provoking content about the mundane, wacky, and weird. I will be writing until the 75th edition. If you know someone who may enjoy the newsletter, you can share it here.
Boxes. They are everywhere around us. From the Amazon package at our doorstep, and the cereal boxes in the pantry, to the stacks of them in warehouses around the world.
While there are many types of boxes, we will dive into corrugated boxes today. In part, because they are integral to the global supply chain and makeup 95% of the boxes in the US. Corrugated is strong, inexpensive renewably sourced, and can be readily recycled. I like to think of it like a sandwich. The sides are like the bread and the squiggly stuff on the inside is what makes the sandwich stand out.
The triangle-like shape makes the box super strong. The air in between the corrugated shapes makes it lighter than other designs, which results in savings for the consumer and seller.
In 2020, almost 407 billion square feet of corrugated cardboard was produced in the U.S., up from 390 billion square feet in both 2018 and 2019.
Corrugated cardboard was invented at a paper mill in 1879 in Brooklyn by a Scotsman named Robert Gair. He accidentally cut through thousands of small seed bags, instead of pressing them. He then realized the new cut could be used as a pre-cut single piece of board that could be folded into boxes. This led to a breakthrough in production time. Soon after, Nabisco and others purchased large orders from Gair’s new boxes and they spread nationwide.
I spoke with my friend Cody Stanton, a packaging engineer at Casper Mattresses. A packaging engineer researches, designs, sources, and manages all the packaging that a company uses. Typically they are used at companies that are dealing with a large volume of products. Part of the art of a packaging engineer is figuring out the best balance of price to customer satisfaction. Here is Cody in a box.
Environmental sustainability is a hot topic in the world of packaging. One of the surprising things I learned from Cody is sustainable packaging doesn’t always mean less material. Sometimes, the optimal environmental box has more cushioning and materials so the item inside doesn’t get damaged. If the item arrives damaged the company has to resend a new package back and the company loses money too. Depending on the product, it is not uncommon for 1-3% of packages to arrive damaged. A packaging engineer might tinker with adding more material to the box and see how much it lowers the return rate of damaged goods.
How have boxes changed with the transition of in-store retail to e-commerce?
E-commerce uses about 7 times more boxes than retail.
Retail boxes need to catch a shopper's eye. With e-commerce that doesn’t matter as much. As you can see below, the Amazon box is plain Jane, while the boxes in the store are trying to stand out.
A journey of a box
I was surprised to learn that a lot of boxes are still made in the U.S. Here is a typical journey of a box.
Tree > wood pulp > paper > blended in with recycled paper > box.
Most of the US trees are harvested in the Pacific Northwest or Southeast. They are then made into wood pulp and put onto a “headbox” (image below) to be made into a long piece of paper. which is more efficient for shipping long distances than a fully formed box.
For instance, a tree might be cut down in Oregon, and shipped to a paper mill in Washington. This paper mill factory processes the tree to wold pulp and then puts it through a headbox to convert the pulp to long paper. The long paper is then put on a truck to southern California where it is converted to boxes that are then used in many of the consumer products produced and shipped from Southern California.
♻️ In 2018, China stopped accepting most types of recycled material from the U.S., including paper and cardboard. This led to a boom in U.S. paper mills, who previously couldn’t compete on price with China.
There was cardboard available to recycle, so mills just had to be retrofitted to turn that cardboard into more cardboard.
Paper mills provide jobs for Americans, but not all are happy about it. Paper mills are notorious for their pollution and odor.
In South Carolina, three groups of plaintiffs filed lawsuits this summer against New-Indy, a company that converted a paper mill to make containerboard, saying the “conversion has made the air dangerous and unhealthy; the state received more than 17,000 complaints of noxious odors from citizens near the New-Indy plant in the first half of this year, which it calls an unprecedented number”.
The future of corrugated cardboard
The concerns are real, but corrugated cardboard is more environmentally sustainable than most alternatives. A box can be recycled 3-5 times before the fibers become too short. Today, about 60% of a cardboard box is recycled and 40% is virgin fibers directly from a tree. What is the future of corrugated cardboard boxes?
Business is booming. Boxes are riding the wave of e-commerce and the packaging industry will grow to $300 billion by 2023.
Fit-to-product. A lot of irregular shapes (e.g. an artificial plant) are currently packed in boxes too big with a lot of wasted space. New “box-on-demand systems” are getting more precise with the size and shape to better fit non-standard items.
Sustainability. A continual push to make things lighter and a better fit for the product. Europe has been particularly successful, where their box weights are typically about 80% of U.S/ weights. Corrugated cardboard is already a more environmentally friendlier option than many plastic alternatives and will continue to gain traction as people push for more sustainability in supply chains.
Listen
The Knowledge Project with Sahil Lavingia on “observing the present”. Sahil was employee #2 at Pinterest and founder of a company called Gumroad. He has a super unique perspective. Here are a few topics I enjoyed:
He was born in NY but talks about his experience growing up in Singapore.
What he wished he knew before raising venture capital money
Why he moved from Silicon Valley to Provo, Utah
Sunlight duration: Europe vs. USA
We may not have gorgeous castles, but at least our parking lots are drenched in sunlight.
Quotes I’m pondering
“Money does not let you do and buy more stuff, it lets you avoid worrying about money”.
-Vitalik Buterin on Lex Fridman podcast.
“He got me invested in some kind of fruit company. And so then I got a call from him saying we don't have to worry about money no more, and I said that’s good. One less thing…Momma said there is only so much fortune a man really needs and the rest is just showing off”.
Pic of the Week
My best friend from childhood Alex Gunn and his wife Hannah visited us in San Francisco for a few days. It was great hiking, playing board games, and exploring the city with this crew.
P.S. if you want a crazy conspiracy theory I have about a boxing company plagiarizing their information, reply back to this email.