The Matrix - Designing a Good Consumer Filter

Posted on May 14th, 2007 by Zach.
Categories: Sustainability, Systems of the World, Industry.

When Socially Responsible Investing (SRI) first started to grow there was inherent challenge that had to be overcome: If a company like Nike was recycling their shoes and a significant leader in waste reduction, but employed 10 year olds for 20 cents a day, were they an acceptable investment? Some people would say; “Yes, the environment is all that matters and Nike is doing a good job innovating on that level.” Others would say; “No, how can you claim to invest in a socially responsible way if you are abusing the labor force that is making the product?” To their credit Nike has made progress on their labor practices over the years, but the reality of these reactions is that both are correct and this ended up being a major barrier for SRI breaking into the mainstream.

The solution that was developed over a number of years was really quite ingenious in a free market sort of way - let the consumer decide what matters. SRI managers have created issue based filters for investing. Care about the environment? Here is a list of companies that are acceptable using that filter. Is labor your issue? There is a filter that fits. In many cases the filters have become even more nuanced allowing consumers to associate different “weights” to each issue based on their own priorities. Combine that with more traditional investing filters (Risk analysis, Diversification, Sector investing, etc.) and you have a very smart approach to the investment process.

This has been incredibly successful, and we have watched SRI fund management grow to exponentially as a result.

I bring this up because Reware is struggling with similar issues as a company. We like to think that we are part of a shift in product creation. We try to integrate concepts that matter in the world - local production, low toxicity, recycled material science, a little environmentalism, minimal packaging, and so on. Basically with every product, we would want a narrative that falls within our vision of next gen product design. This is what we believe is good for the world, and we know this is where the money is. We are after all in in this thing both to change the world and make money, pro-market force peeps that we are.

The annoying thing about being what’s next, is that the systems of the world are conspiring against you pretty much at every turn. As a small company we don’t have the resources to force our vendors to adjust to our needs. And this is a hard thing, something that I am sure Patagonia struggled with in the early days, that Nau is going through, and Arbor Sports has had to deal with. Everyone trying to adjust the status quo in product design runs into these systems like a brick wall.

A tangible example:

Right now we make three lines of solar bag. Our favorite is the ES line. With three styles (Daypack, Messenger, and Backpack) and three or four colors, we sew these bags in Texas. The quality is second to none and that is always an important factor. Plus the best part of this line is the fact that all the fabrics are made from recycled soda bottles. It is a bag that fits all of our goals - Production in the US, recylced fabrics, solar on the front to charge to gizmos - pretty great right?

Thank you, I will accept your humanitarian award, but please hold the applause.

A down side to this fabric is that it is not currently in wide distribution. What this means is that there is a limited supply in the marketplace, production keeps shifting from one factory to another, and the low toxicity dyes and process pieces don’t always work quite right. The company we work with to sew the bags struggles because they too are doing something that has never really been done and these barriers screw up production. This is a problem because often we cannot rely of a steady stream of bags. We then cannot offer these bags to larger clients because we worry we will not be able to supply them. I feel my ulcer flaring up just writing about it.

So problem #1: Production of the environmental fabrics is amazing, cool to be a part of, but sometimes unreliable.

The answer for us has been to use a more traditional system of sewing with a great company in North Carolina. Still in the U.S., but made for the most part from traditional Denier or Ballistic nylon. Still with the solar. So we have lost the recycled fabric piece with this style (we are experimenting with some organic fabrics), but gained reliability of production. This gives us the ability to sell more widely and have more faith that we can deliver. Plus making in the US we have a 4 week turn around for the most part, meaning that our response to the market is fast. Really fast. Speed and reliability comes at a price though and it is a steep one. The bag we sew in NC we could probably make in China for a 1/5 the price. That is a huge price discrepancy and effects the end cost to the consumer as well as our bottom line.

Problem #2: North Carolina is expensive

Anyone who manufactures overseas will tell you that product development is a headache - especially if you are a small company. The reality is, China is just far away and that leads to complications. No offense to Mr. Friedman, whose picture of the flat world is a good one, but in my experience it not so much seamless as navigating the seams themselves. You basically need a person on-site that you know and can communicate effectively with. Or you need to go yourself, and often. But there are huge benefits - the low costs are the primary one. This may seem cold because we all like to think that we would pay more for our stuff. The reality is that we will not. We have an idea about what things will cost and as consumers, we will not deviate from that. This is why China is booming, and industries like sewing are disappearing for the US. It just is what it is, and there is no avoiding it.

Problem #3: Overseas production is complicated for small companies. It has long lead times per order. We have to worry about labor conditions, and environmental usage.

So there is no silver bullet here that solves all of our problems. This is and will become reoccurring theme of the fundamental industrial shift we are going through as a country, as a world. There is no single solution in Energy, in Waste, in Water Conservation - in a every area it will take a basket approach to solve problems.

So our dilemma has been this - How do you quantify the narrative of your products? Is a future bag made in China of recycled fabrics better, or worse than a Denier Nylon bag made in the States? Is the fact that production is inconsistent for astounding products better than average products that are reliably produced?

What do consumers value most in their so-called “green” products?

For a while I have been agonizing over this, and in the end the SRI model that I love so much is a good starting point. We are attempting to create a matrix to products that allow the consumer to weight what is important to them. We will have products from overseas, we will have products made in the states. We will have expensive “Boutique” or “Limited Edition” uber green bags. We will have more traditional fabrics with solar on them.

In the end we will leave it all up to the consumer to work out what is most important. Hopefully we will grow to a level that we can dictate our needs to producers and get everything we want in one product. - and really what is more greenie-capitalist America than that?

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I hate packaging.

Posted on May 8th, 2007 by Zach.
Categories: Sustainability, Systems of the World.

Can I be any clearer than that? Let me try: I hate Blister Packaging with a fiery passion that knows no bounds. You know this stuff - every electronic gizmo comes in it. It’s a clear plastic shell that is totally impenetrable, the Fort Knox of packaging. If you were stuck on a deserted island with no tools and had to get it open to eat, you would either starve to death, or else die accidentally slicing an artery on the razor like edges.

I mean is there anything quite so stupid? It is such a nightmare, people are developing special tools to open this kind of packaging. Check out this one.

Pretty smart, but according to an article I read, the tool comes in Blister Pack. Great. Still dying on the island.

Vendors love this stuff I guess, and factories make the packaging process easy (plus there is no currently viable alternative, so the point is moot). If I order a pallet of items from overseas, not only do I get my product all packaged up coming out of the factory, but they will put my branding and instructions in the thing so I don’t have to do any assembly afterwards. You would not believe what a hassle reduction that is for a company. And reduced hassle is my dream come true these days.

Blister packing protects the products from damage really well too. Plastic really can get fairly beaten up and still look decent on an in-store display.

You want to experience waste? In my life it is when stores send back product because the PACKAGING is damaged. I love this, it always makes my day - the product is fine, it is just the protective shell that is beaten up. What? But this is not a knock on the stores. People don’t buy things with beaten up packaging. They just don’t. This may sound like stupid reasoning, but I have recently learned a lot about how people buy in stores (myself included) and presentation means a whole lot, it may be the only thing that matters in many cases.

It is hard to steal anything that is contained in Blister Packaging and that is a plus, but this is mainly due to the fact that there is so much plastic around the product. As an example, I recently bought a set of earbud headphones. There was at least double the amount of plastic in the packaging than in the product itself.

These aren’t the ones exactly, but you get the idea.

Douglas Adams once announced that a society which had instructions on toothpicks was broken. Me? I think when the material in packaging exceeds the product, we are all in big trouble.

What is truly excellent is that our plastic trash will be here a while. This stuff sits around for the odd 3-6 thousand years. It is typically a low grade plastic too which cannot be recycled. Instead we throw it away about 12 seconds after tearing into it as consumers. Broken System Alert.

The worst part of the whole thing is that plastic is made of petroleum. In an age where oil is getting more and more valuable, it is insane that we use so much in such useless situations. Thinking about the Oil economy takes up way too much of my time these days, but at least it is usually based around situations where Oil is being used because there are no other systemic options. This is true in packaging of course, there are no other great options, but it seems like this is a fairly easy systemic fix. Proof yet again that if I was a billionaire it would be fun to start the next generation plastics lab. There is no reason packaging has to stay around the way it does. And maybe we could save the oil for, you know, driving firetrucks around or something?

Next up in the Packaging Vent-A-Thon: Cardboard….

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