Beverages

Consumer product businesses are significant users of natural resources, as their output relies on a range of nature's goods, such as water, forestry, and agricultural products. From the high emissions levels, energy consumption, and water usage at production facilities to their packaging and solid waste materials, their environmental footprint is among the largest of any in the global economy. When viewed as a supply chain from raw materials through consumption, their direct and indirect environmental impact continues to grow significantly.

Within consumer products, the beverage industry has arguably the most recognizable brands in any industry. Through billions of dollars invested in marketing over the years, brands like Coke and Budweiser have become icons around the globe. Beverage industry revenue in the United States alone is over $200 billion and growing. Beverage products are deeply rooted in consumer lifestyle activities. Even in difficult economic times, consumers rarely sacrifice their morning coffee, a cold bottle of water to quench their thirst, or a glass of wine over dinner.

The beverage industry is considered a critical player in the environmental sustainability movement. The examples here provide a perspective on the environmental challenges facing the industry.

• Millions of barrels of oil are used each year in beverage industry production and distribution.
• Increased complexity in global supply chains has effectively resulted in higher energy use and emissions output.
• Raw materials used in production, such as the corn needed for corn syrup, disperse significant amounts of chemical fertilizers and pesticides into our rivers through wastewater runoff.
• Millions of beverages are sold in plastic bottles every day, contributing to the issue of waste product disposal.

The beverage industry is challenged as much as any consumer products industry to aggressively pursue sound environmental practices while simultaneously addressing consumer demands and achieving reasonable revenue growth. Heavy reliance on natural resources traditionally considered commodities such as oil, water, and corn creates reduced margins for the beverage companies as raw material input prices increase. Meeting the rapidly increasing demand from consumers in developing countries dictates higher energy and raw material usage, while requiring significant capital investment to expand. Consumer lifestyle activities have increased consumption trends toward convenience and fitness. The beverage industry has seized the opportunity to produce reduced-calorie and reduced-serving size packages, thus increasing the waste disposal problem.

A large percentage of beverage industry products are sold to the consumer through chain retailers. As those retailers attempt to reduce their own costs through supply chain optimization initiatives, certain costs are shifted back to suppliers, further compressing profit margins for the beverage industry. For example, in an attempt to reduce waste disposal issues after consumption, Wal-Mart has initiated efforts to dictate the type of packaging materials suppliers like beverage manufacturers can use in their stores.

In response to consumer and public demand, the beverage industry has initiated programs to reduce its environmental footprint. Select examples illustrate the proenvironment direction the industry seems to have embraced:

• leveraging their aluminum recycling competencies to establish aggressive recycling objectives on all packaging materials, including plastic- and paper-based containers;
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• reducing water usage through efficient water management

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