From potatoes to packaging design
Bio-based economy: Making money by saving the environment
PaperFoam is a textbook example of a company that realises its revenue in the biobased economy. This company is based in the Netherlands and produces packaging materials from industrial potato starch and cellulose fibres. PaperFoam is known for its sleek and stylish packaging solutions for products including electronics, cosmetics and Champagne. All its packaging solutions are 100% biodegradable and produced with minimum impact on the environment.
The idea for PaperFoam was born in the early 1990s. Mark Geerts, who is now CEO of PaperFoam, was working at the ICT company Vertis at the time. Potato processing company Avebe asked the company to take part in a bioplastics development project. Geerts: “While the project stalled, we had a strong hunch we were working on something that offered a world of opportunities and an excellent environmental profile. That’s why we decided to continue the bioplastics development process ourselves. Our gut feeling was: ‘This could be huge!’”
“We entered the market in 2000, which was a very different market than it is today. Environmental-friendliness was still the bastion of back-to-nature types. There wasn’t much public support, so what we were doing was truly pioneering. We needed forerunners. Clients who could look into the future and dare to take up the challenge with us, without being afraid of potential teething troubles. We found those forerunners in the electronics sector.” This choice of sector was logical both due to its innovative nature and because it is willing to spend more on packaging materials owing to the predominance of high-ticket items within the sector.
Giving the idea wings
PaperFoam in 2016 is a stable international company with more than 100 employees. Its headquarters are located in Barneveld, the Netherlands with production facilities in Malaysia and North Carolina, US. “We never calculated exactly how big we could become,” says Geerts, “but we were determined from the start to create the right conditions to give this incredible idea wings. And to do that, we knew we needed to attain sufficient scale and focus on international clients. From day one we wanted to be present in the world’s top packaging locations – back then, those were also Dallas, Beijing, Shanghai and Denmark. Because packaging manufacturers are our competitors.”
Range of competitive qualities
How does PaperFoam compete with those other manufacturers? Geerts: “Our materials have different distinctive qualities and we also have different types of clients. Some see our biobased economy credentials with the smallest possible ecological footprint as crucial. Others choose PaperFoam due to the qualities of our packaging materials. Our packaging is injected into a mould and as a result you can create very specific forms with pinpoint precision. This means we can produce tailor-made packaging that clamps and holds products securely in place. We also have clients who choose our products thanks to their natural appearance or because PaperFoam packaging solutions give them something special that their competitors don’t have. We can provide them with added distinctiveness. And last but not least, another key advantage is that our packaging materials are ultra-light, which significantly reduces transportation costs.”
The base components that make up PaperFoam are fully biodegradable
While PaperFoam is a stable company, it is still a small player in the global packaging market. Geerts: “We’re aiming to achieve strong growth in the coming years. There are now ample opportunities to make it big. There is currently much more public support and we’ve noticed that companies have been focusing ever greater attention on environmentally-friendly solutions since last year’s UN climate change conference in Paris.”
PaperFoam envisions growth opportunities primarily by expanding into different sectors. Its clientele is still comprised mainly of electronic companies. “We especially see opportunities in the medical sector and food industry. They are markets that are more stable than the electronics sector.” PaperFoam will, however, have to reduce the prices of its packaging solutions in order to break into these sectors. Foods and medicines generally cost much less than electronics and so logically, the packaging must also cost less.
Less expensive raw materials
“In order to lower the cost of our materials, we need to find less expensive raw materials. The fibres we use now come from trees. But it takes around 20 years for a tree to grow, so that’s pretty expensive. We might be able to use fibres from residual flows from sugar beets, for example, or fibres from one-year crops such as hemp and bamboo. It’s the same story with the industrial starch that is currently extracted from potatoes grown specifically for this purpose. We may be able to use waste flows from sectors such as the French fries industry. This kind of potato starch is often polluted and consequently can’t be used for sleek design packaging because it has to be immaculate. But that’s less important for food packaging where it’s okay to have a few black specks in the materials. It’s actually even seen as a plus-point because it shows their packaging is made of natural materials.”
Successful enterprise within the biobased economy
If you want to be able to use someone else’s waste materials, you have to work in partnership with other companies. “That collaboration is vital to the biobased economy,” Geerts emphasises. “That’s why it’s imperative to network within the biobased economy. After all, you need each other for residual flows or materials.” Geerts says this does, however, call for focus. “The biobased market is undergoing a period of rapid development. There’s so much going on right now that you could easily get swallowed up in all the conferences and networks. In order to prevent that from happening, you have to focus on your own product and then find the right network to go with it.” But the most important tip Geerts wants to give other companies whether they’re biobased or not is: “Make sure you make a really fun company! A place where people enjoy working. That unleashes creativity and creates an atmosphere conducive to developing and realising innovative ideas as a team.”