LINPAC Allibert

Inventing new ways of delivering value

Agenda

UK Retail snap shot UK RTP (Returnable Transit Packaging) system UK pool size / rotations per retailer Why standardisation is important Bread basket standardisation case study Opportunities to grow RTP participation: - Folding crate - Minipac & Maxipac - Dollies

2012163.2bn

5 year growth+18.0%

CAGR+3.3%

2017192.6bn

133.6 139.2146.0 152.2

157.3 163.2168.1 173.6

179.6 186.0192.6

3.8%4.2%

4.9%4.3%

3.3%3.8%

2.9%3.3% 3.4%

3.6% 3.5%

0%

1%

2%

3%

4%

5%

6%

7%

8%

9%

10%

0

50

100

150

200

250

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

YOY growth (%)

Grocery retail market size (bn)

133.6 139.2146.0 152.2

157.3 163.2168.1 173.6

179.6 186.0192.6

3.8%4.2%

4.9%4.3%

3.3%3.8%

2.9%3.3% 3.4%

3.6% 3.5%

0%

1%

2%

3%

4%

5%

6%

7%

8%

9%

10%

0

50

100

150

200

250

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

YOY growth (%)

Grocery retail market size (bn)

UK grocery market snapshot: Summer 2012

Rate of growth slowing Energy costs and austerity measures affecting household spend Very competitive market

Source: IGD Research; IGD ShopperVista July 2012. All market data is for year to April

Online, discount and convenience to lead growth

Year to April 2012Value (bn)

Year to April 2017Value (bn)

Change in Value %

Superstores and hypermarkets 72.3 76.9 6.4

Small supermarkets (3,000-25,000 sq ft) 34.5 38.8 12.5

Convenience 33.9 43.6 28.5Discounters 7.5 12.4 64.7Online 5.6 11.1 97.7Other retailers 9.4 9.8 4.2Total 163.2 192.6 18.0

Year to April 2012Value (bn)

Year to April 2017Value (bn)

Change in Value %

Superstores and hypermarkets 72.3 76.9 6.4

Small supermarkets (3,000-25,000 sq ft) 34.5 38.8 12.5

Convenience 33.9 43.6 28.5Discounters 7.5 12.4 64.7Online 5.6 11.1 97.7Other retailers 9.4 9.8 4.2Total 163.2 192.6 18.0

UK RTP System

Roll out of standard Grocery RTP since early 1990s

Used mainly for domestic produce & fresh meat

Bakeries now have shared-use dedicated pool

Other RTP formats used for high volume beverage lines

Why use RTP?

Reduce supply chain cost

Improve in store space utilisation

Reduce waste

Enhance product protection

Lower health & safety risks

More consistent merchandising

Improved carbon footprint

UK Crate Pool - Snap Shot

Trip fee includes deposit, issue fee & daily hire from 0.30 to 0.50

Averagecycletimescanfluctuatebetween14&21days(some as low as 7 days)

Maxinest Share Tesco UK Aldi Coop M&S Asda Sainsbury Morrisons WaitroseMkt Share % 34 3 7 4 17 16 12 7Est annual tray trips m

220 18 36.8 152 160 200 170

Charging method

Trip Fee Trip Fee

Trip Fee Trip Fee

Trip Fee

Trip Fee Trip Fee Trip Fee

Service provider

Norbert Logtek Norbert Logtek Norbert K&N IFCO and self

IFCO

Total Fleet Size 2011 (000's)

11,000 1,200 2,419 7,455 5,795 10,500 4,930 2,500

Maxinest Share Tesco UK Aldi Coop M&S Asda Sainsbury Morrisons WaitroseMkt Share % 34 3 7 4 17 16 12 7Est annual tray trips m

220 18 36.8 152 160 200 170

Charging method

Trip Fee Trip Fee

Trip Fee Trip Fee

Trip Fee

Trip Fee Trip Fee Trip Fee

Service provider

Norbert Logtek Norbert Logtek Norbert K&N IFCO and self

IFCO

Total Fleet Size 2011 (000's)

11,000 1,200 2,419 7,455 5,795 10,500 4,930 2,500

Why standardisation is important

Supplier to shelf journey to be achieved in the shortest, most responsive and efficientwaypossible

Maximise availability, drive sales & reduce wastage

Suppliers & depots able to invest in generic automation

Standardmerchandisingfixture

Less time sorting kit at back of store

Simpler pool management enabling better stock management

Thecostbenefitofstandardisation

UK Grocery Pool RTP trips estimate 850-million per year

Approx 47-million trays required to support this

Variants being rationalised

Tray types reduced by 50% to an average of four

Less tray sorting at back of store & wash sites

Saving realised to be approximately 30m PA

Bread case study: No. of variants

Different suppliers used different baskets

Each type of basket was a different size

This added to replenishment cost

Wasted space at back of store

Difficultyinrepatriatingbasketsto correct suppliers

Case study: bread merchandising

From this... to this...

in a tray that works for all parties

Project Team

Retailer

Bread Suppliers

Equipment Pooling Operators

Tray suppliers

Dolly / wheel suppliers

Shelving manufacturers

Suppliers Stores Staff ShopperAgree common tray Increase availability Easy to check date code Aisles less congested

Fit all products Decrease aisle congestion

Easy ID of bread type Can get what they want

Achieve high brand visibility/recognition

Improve quality (reduce handling)

Easy to move stacks Good product visibility

Work with existing handling methods

Increase sales Easy to replenish the fixture

Easy to shop

Work with existing handling equipment

Reduce waste Easy to stack empty trays on wheels

Good product quality

Work with existing in-bakery automation

Ten loaf tray (Health & Safety)

Easy to remove equipmentfrom shop floor

Equipment is more customer friendly

Fit with modular fixture format

Easy to rotate

Easy to check bread in on receipt (count)

Suppliers Stores Staff ShopperAgree common tray Increase availability Easy to check date code Aisles less congested

Fit all products Decrease aisle congestion

Easy ID of bread type Can get what they want

Achieve high brand visibility/recognition

Improve quality (reduce handling)

Easy to move stacks Good product visibility

Work with existing handling methods

Increase sales Easy to replenish the fixture

Easy to shop

Work with existing handling equipment

Reduce waste Easy to stack empty trays on wheels

Good product quality

Work with existing in-bakery automation

Ten loaf tray (Health & Safety)

Easy to remove equipmentfrom shop floor

Equipment is more customer friendly

Fit with modular fixture format

Easy to rotate

Easy to check bread in on receipt (count)

Outline criteria

The new folding reusable transit packaging solution for food and grocery distribution

RTP growth: Interfold

RTP growth: Interfold

Over 90% of UK fresh produce & meat distributed in Maxinest RTP

90% of imported produce still in card

150-million cases of imported produce each year (excluding bananas)

Need to develop a folding crate that inter-works with existing nesting crates

Folding crates typically offer 10%+ internal volume

Also able to stack 8,580 units on reverse loads

Interstacking of trays does not impact on productivity at depot.

RTP growth: Interfold

Pallet and wheel based bulk shipping & display units

RTP growth: Maxipac

RTP growth: Maxipac case study

Carrefour using Maxipac for potatoes

Problem:

Assembly of bulk units slow

Product prone to damage

Under recovery of vehicle costs

Nonstackable

Poor display in store

Not easy to replenish

RTP growth: Maxipac case study

Carrefour using Maxipac for potatoes

Outcome:

56% improvement in stock density

Reduced transport cost

Faster merchandising time

Improved customer quality perception

Delivers a more cleaner and consistent display

RTP Growth: Maxipac,what good looks like!

RTP Growth: Minipac

New half size unit: 600x400

Ideal for smaller stores

Stores which dont sell high volume potatoes

Ideal for root vegetables...

...and other categories such as eggs which need higher level protection

Alsopromoofffixturedisplay activity

RTP Growth: Maxipac & Minipac,what good looks like!

Ease & speed manual handling operations

RTP growth: Dollies

Dollies

800x600 & 600x400 introduced more than ten years ago

Enables faster replenishment in store

Faster picking at depot

Can be used as merchandising unit

RTP growth: Dollies

For high volume fresh lines crates can be packed straight onto dollies instead of pallets

The standard Euro crate can be stacked 11 high onto dollies the same as a pallet

Full vehicle loads would hold 1,408 full trays & 64 dollies

Utilise vehicle better when collecting compared to wood

Approximate trip price under 2.00

Supplier

Dollies used for high volume lines into big stores can be cross docked saving picking hours at depot and at store level.

Depot

Colleagues in store can move crates easily and quickly

At peak trading times produce can me merchandised straight from dollies

Increase in sales, lower wastage

Increase in productivity

Store

From experience gained working with other retailers; the increase inefficiencyatthelast50metresisasfollows:

l 12 / week sales increase per store

l 1.2 / week saved on wastage per store

l 0.5K / week saved on lower wages per store

These three main areas would save on add on average 13.7K/week per store.

Multiply 365 days x store no.s

Store

Pop-ups safely retain loads

Clover-leaf recesses allows dollies to stack safely when empty

Uniqueflip-outextension for carrying nested ALCs

Clearance for fork-lifting dolly on or off

delivery vehicle

100mm braked castors

Clip-on/off interlocking

handle

Universal dolly

Reusable standard RTPs can be win:win

Instorebenefits

Availability

Reduced out of stocks

Supplierbenefits

Improved product protection

Cost

Sustainable

Summary