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Sustainability spices up McCormick & Co. supply chain

McCormick & Co., the Baltimore-based maker of spices and seasonings (NYSE: MKC), stands out in the consumer food products sector for its aggressive pursuit of eco-friendly practices.

“McCormick has embraced sustainability in the supply chain,” said Ted Stank, a professor of supply chain management at the Haslam College of Business at the University of Tennessee.

Ranked number 14 of 25 in the FreightWaves Shipper of Choice awards, McCormick has set a goal of 100 percent plastic packaging that can be reused, recycled or repurposed by 2025. The company recently reinvented its packaging for two of its iconic products, black pepper and Old Bay seasoning, replacing metal cans and plastic tops with a fully recyclable container that equates to a 16 percent reduction in carbon emissions.

McCormick & Co. works with agricultural cooperatives to improve the lives of local farmers around the globe. It was named the 13th most sustainable corporation and first in the food products industry on the 2019 Global 100 Sustainability Index released at the World Economic Forum by Corporate Knights.

McCormick has made other improvements to its supply chain processes. The company shifted into a globally organized supply chain over the last several years and as a result has gained economies of scale and standardization to improve margins, said Stank, who worked with a McCormick executive enrolled in UT’s executive MBA program. McCormick is also a longtime partner of the university’s global supply chain institute.

The company recognizes that cost management has been a big focus, Stank said. “Now a lot of what it is selling is moving into mobile purchasing. So it is having to become more flexible and agile as to where it picks up product.”

“That has McCormick focused more on building flexibility into capital assets and manufacturing,” Stank said.

McCormick & Co. sales rose 1 percent in the first quarter of 2019 from the year-ago period. Operating income was $197 million in the first quarter compared to $181 million in the first quarter of 2018. Adjusted operating income was $199 million, a 4 percent increase from $192 million in the first quarter of 2018.

FreightWaves and Convoy recently teamed up to present the first annual Shipper of Choice Award to top-notch manufacturers, distributors and retailers. The first-of-its-kind award was created to recognize shippers committed to eliminating inefficiencies from the supply chain and aiming to be excellent partners for their carriers.

Carrier-members of the Truckload Carriers Association and the Blockchain in Transport Alliance (BiTA) voted for Shippers of Choice based on qualities such as flexibility and detention on a five-star scale, with a possible total score of 25 points.

“The Shipper of Choice Award is all about increasing transparency as we highlight innovative best practices that keep freight moving and contribute to a healthy freight community,” FreightWaves CEO Craig Fuller said.

Linda Baker, Senior Environment and Technology Reporter

Linda Baker is a FreightWaves senior reporter based in Portland, Oregon. Her beat includes autonomous vehicles, the startup scene, clean trucking, and emissions regulations. Please send tips and story ideas to [email protected].