It’s corrugated’s world, and alternative shipping formats are just living in it. But now, FedEx and Returnity have launched a reusable shipping offering for B2B customers that they say cracks the code on working in FedEx’s logistics network just as well as, if not better than, traditional single-use fiber-based boxes.
“The entire logistics world has been built around corrugated for decades and decades,” said Mike Newman, CEO of reusable packaging manufacturer Returnity. “When everything is built for corrugated, it’s not actually that easy to integrate something other than corrugated.”
Now, FedEx’s U.S. B2B customers have the option to implement the “durable, collapsible, and automation-friendly” containers that Returnity designed specially for FedEx, without incurring additional handling fees.
The scaled offering follows a pilot period. While FedEx and Returnity have been in talks for nearly a decade, their recent collaboration centered on evaluating the packaging itself and making sure it would meet FedEx network requirements, plus identifying which B2B partners would be a good fit. The answer was retailers, particularly those specializing in soft goods like apparel or linens.
“It’s really only been the last few years where we started to be able to line up on where the business case was and what the right integration was to create opportunities,” said Newman.
Reusable box specs
- Produced in Southeast Asia
- Made from corrugated plastic with a fabric wrap
- Guaranteed for 50 uses; users have option to pay Returnity for demanufacturing at end of life
- Available in standard sizing for easy palletizing, or custom
B2B shipments represent some 45% of FedEx’s U.S. domestic revenue base, according to a spokesperson. By targeting B2B, the containers can stay in closed loops — a proven tenet of success for reusable packaging.
The containers are designed to work well for forward logistics to stores, returns from stores or inventory balance between stores. Out of the gate, FedEx and Returnity have observed success with retailers that do shipments along regular legs on which they can control the use of the packaging, Newman said. The partners did not name early adopters.
While FedEx is promoting the new option to U.S. customers, interested companies lease or purchase containers directly from Returnity.
Returnity designs and makes the containers, but FedEx and customers handle them once they’re moving through the supply chain.
There are multiple layers to the single-use vs. reusable container cost analysis, according to Newman. First is potential savings on materials like corrugated boxes and tape. There are also labor efficiencies: Newman said pilots showed that unpacking the reusable containers saves about 30 seconds of time compared with single-use containers. “They pop open, they collapse flat, you’re not cutting with box cutters,” he said, also noting that eliminating the box cutter reduces risk for damaging the products inside.
Returnity and FedEx claim a 30% cost savings for some customers that opt for reusables over corrugated. There’s also better cost predictability with reusables, Newman said.
“You’re sort of insulating yourself from supply chain shocks — [something that’s] increasingly relevant, you only have to look at the last few weeks,” he said. With reusable containers already procured, “you don't have to worry about fluctuations in price and availability.”
FedEx claims the reusable boxes could reduce carbon emissions by “64% to 88% compared to a single-use corrugated packaging under typical conditions, based on a non-return rate of 40% or less,” pointing to a 2021 analysis of reusable packaging in fashion. This is just one piece of FedEx’s bigger-picture goal to have carbon-neutral operations by 2040.
Newman said there’s also been feedback from retail workers that the reusable containers, which have handles, are easier to move than corrugated boxes. “They aren't usually the primary reason that a retailer is making the switch, but once they've piloted and they see just how much their retail stores appreciate this, it's one more incentive to keep it in the field,” Newman said.
FedEx has been trying to see the challenges through the customer lens, said Tyler Kenney, manager of packaging design and development.
“Reusables just have not been economically viable and operationally viable,” he said. “We had to design a package that moved effectively through the FedEx network.”
One aspect was to come up with a tailored labeling solution. Labels are placed in a pouch-like affixation in lieu of sticky labels that lead to adhesive residue build-up. They’re placed where the barcode can be clearly legible throughout the entirety of the ship cycle, he said.
Newman noted that the partners also worked on container closures and ensuring tamper security. “It’s a lot of the little nuanced components that ultimately are where the box has to shine to be able to be used for that 30th, 40th and 50th shipping cycle,” he said.
“Our goal for this project was to build something with Returnity that behaved exactly like a corrugated fiber-based box in every way, from an operational perspective.”
Tyler Kenney
manager of packaging design and development at FedEx
As Returnity looks ahead, it’s “open to working with any logistics providers who are interested in this space,” said Newman, noting Returnity has also collaborated with the likes of Walmart, Target and Rent The Runway, as well as Happy Returns, which is now owned by UPS.
B2B remains the focus. “I think we are unlikely to see a reuse revolution in e-commerce because of just how big of a gap there is, both in cost and a consumer behavior,” Newman said.
