Bioplastics in 2012: Time for a truth take a look at

Four reasons why bioplastics have been perceived as
underachieving. 

I was recently asked by a
colleague, “What is the largest roadblock to more universal acceptance of
bioplastics usage in packaging?”  Like
any broad question involving a new technology or broad market, the question
requires more than a sound bite to answer. 
So here goes…

Market expectations for
bioplastic usage were initially hyped as this wonderful technology that would
replace traditional plastics in all applications.  Some predictions say they will replace 20% of
all plastics.
Who were the proponents of
these lofty predictions kidding?  They
certainly were not uttered by people with knowledge of market development
realities or experience in the plastic industry.  So why haven’t bioplastics captured a larger
market share than their reported 1-2% of total plastic usage?  There are four reasons: 

1. Performance is not matched
   to brand owner or consumer expectations;
2. Time-line to market
   acceptance not realistic;
3. Bioplastic companies
   marketing efforts not given enough field support and
4. Difficulties selling to an
   uninformed customer base and an uninformed end-user base. 

None of these reasons should
be surprises to anyone who understands the very complicated task of introducing
new products to a new customer base. 
Noticeably absent from this list is price and its effect on the value
proposition of bioplastics.  Due to its
complexity, that it will be addressed in later discussions. Let’s look at each
of these. 

1. Performance versus expectations

First, performance is not
matched to brand owner or consumer expectations.  The most obvious example of this is the area
of biodegradable plastics.  The average
consumer believes if you throw a film wrapper out the car window it will
degrade in the ambient environment in a ‘reasonable’ amount of time thus
eliminating litter.  Not so.  For a bioplastic to truly behave in this
fashion, which is possible but not practical, it would not have the set of
properties to withstand the rigors of manufacture, distribution, shelf life,
product safety and barrier. It would not perform its role as a package, thus
the disconnect.

2. Unrealistic timeline

Secondly, the time-line to
market acceptance is not realistic. 
Market development is a tough business. 
Even with an established customer from an existing vendor relationship a
new offering can take 8-16 months from introduction to commercialization.  Metabolix (www.metabolix.com),
FkuR (www.fkur.de),
Cereplast (www.cereplast.com),
etc. are relatively new companies compared to
DuPont (www.dupont.com),
Dow (www.dow.com)
and BASF (www.basf.us).
Additionally many of these
bioplastic companies are agricultural-based, not polymer-based companies;
therefore many had to learn knowledge of supply chain, distribution, selling
effort, etc. needed to develop rapid footholds in the plastic industry.

3.  Marketing
efforts need more support

Thirdly, bioplastic companies
marketing efforts not given enough support is another reason for the low level
of sales.  Since many of the bioplastic
suppliers are new companies within the last ten years they have started from
limited manpower resources.  To
effectively market a new product nationally in the plastic industry one needs a
sales/ market development/tech service force of at least 10-15 individuals in
the field to effectively build a new offering business.  Most of the new bioplastic companies come in
under that number of individuals supporting the business in the field.

4. Lack of information undermines sales

Lastly, the difficulties in
selling to an uninformed customer base and an uninformed end-user base are the
biggest deterrent to meeting initial sales projections.  The amount of misinformation and lack of
basic bioplastic knowledge at the converter, brand-owner and consumer level in
this industry is staggering. When a new market development effort has to
incorporate an educational component and overcome misconceptions of what it is,
one is marketing the process beginning in a hole.  I’ve had one bioplastic company market
development executive tell me that 70% of his job is educating his customers
and brand-owners about bioplastics in general before he even gets to a
discussion on the merits of his particular offering.
All the listed reasons have
contributed to the low level of sales bioplastics have reached to date.  The basic question one has to ask is if
current sales levels are what should be expected or were expectations set too
high by industry executives unfamiliar with the market infrastructure they were
entering?  Is media hype driven by lofty
press releases written to gain investor seed money rather than reflecting
marketplace reality? 

I submit the current status
of sales in this industry is what could reasonably be expected at this point in
the life cycle of bioplastics.  The
discussion gets more complex when one factors in the extremely high growth
expected from the bio-based products coming from the various drop-in
technologies being developed as replacement for traditional petro-based HDPE,
PET and PP. 
The bottom line: Bioplastics
are here to stay, they are meeting brand-owner and consumer needs and they are
being designed to meet performance requirements and end-of-life options one
application at a time. The whole process just takes time.

Jeff Timm has spent more than
35 years in the plastics industry with Fortune 100 companies. The last six
years have been as managing principal for Timm Consulting, Franksville, WI,
a plastics business and market development consultancy focusing on bioplastics.
Timm can be reached at phone 272-880-7353 or:

jeff@timmconsulting.net

www.linkedin.com/in/jefftimm

www.twitter.com/bioplasticman