In the coming months, we’ll be transitioning our Candle Subscription packaging from Mushroom Packaging to Molded Pulp.
When we started Keap back in 2015, we knew that bio-based packaging was going to be a critical part of our vision for the future. We wanted to find and invest in solutions that could be reused and ultimately returned to the soil.
In 2017, thanks to our neighbor in Brooklyn, Danielle Trofe, we were put in touch with our wonderful partners at Ecovative, who had pioneered the creation and techniques of growing Mushroom Packaging — an at-home compostable alternative to plastic-based foams. Since then, we have been one of the few companies on earth shipping the majority of our packages in this incredible material.
Sadly, since 2019, a number of operational challenges have occurred. Firstly, our Mushroom Packaging went from being produced nearby in Troy, New York, to Paradise, California.
Secondly, our supplier has been struggling with maintaining a steady supply of the raw agricultural waste material needed as substrate for the packaging. Finally, we have seen the costs of the Mushroom Packaging piece increase significantly as our supplier learned the true economics of producing it for us reliably, e.g., taking into account wasted material and labor.
The impact of the above has been twofold. We have not had enough Mushroom Packaging available to ship out all our candles, and the cost of each piece of packaging has almost doubled from $0.9 per unit to $1.60. (A rough rule of thumb in business is that any cost associated with making something has to be doubled when you set your retail pricing.* Thus, the Mushroom Packaging had an implied cost to our customers of $3.20 per candle.) Finally, shipping our packaging from California to New York has been both expensive and wasteful given our vision of creating net benefit through our operations.
*Later this year, we’ll be publishing a full story looking at the costs that impact our pricing and the economics of running a candle company!
The Future of Packaging, Lumi
With these significant challenges to our operations and pricing, we decided to look into alternative materials. Thankfully, we were put in touch with the experts at Guacamole Airplane through their fantastic writing on the subject of the future of packaging. This led us to identify molded pulp as a potential alternative to Mushroom Packaging.
Let’s do a quick molded pulp 101!
- What is molded pulp? Egg-cartons, wine protectors, trendy food bowls, and even the beautifully shaped packaging that an iPhone arrives inside are all examples of molded pulp. Molded pulp is a form of protective packaging created by molding paper fibers to an exact form under pressure. Depending on the type of paper fibers used, the texture and color can vary.
- Is it recyclable and compostable? Our molded pulp is recyclable and home compostable. It is made from compressed paper with no binding agents or additional additives. Even better, it is made from 100% recycled newspapers, recycled corrugated cardboard, and water. Note: This may not be the case for all molded pulp products, since some may use heavily bleached paper fibers or binding agents.
- Why not use this before? Molded pulp has incredibly high startup costs to due to the need to create custom molds for the machinery that produces the packaging pieces. Roughly put, we’re talking about an upfront investment of $50,000. This limits molded pulp’s use to high volumes where these costs can be amortized over hundreds of thousands of pieces. We’re finally at the point where this is feasible for us as a small company (though it will take us a significant time to recoup our investment).
- What are the benefits? Molded pulp is fully home compostable and the costs per molded piece will be closer to $0.30. This will help us minimize price increases later this year. Beyond this, our supplier will be based near us in Connecticut (a 2-3 hour drive from our studio in Kingston), meaning lower shipping costs and less impact on the environment.
A molded wine protector, Guacamole Airplane
A Future of Fungi
As we make this change to molded pulp, we are still of the mind that Mushroom Packaging has the potential to radically change how we manufacture and think about packaging in the future. While it has become untenable for us to continue using it in the short term, we know there are incredibly smart and ambitious folks working to make it easier for companies of all sizes to use Mushroom Packaging. With time, we expect the costs and capabilities to improve, and we do foresee a future in which mushroom packaging is ubiquitous. On our end, we continue to speak with Ecovative about new ways to apply their research in our products. We expect to reintegrate mycelium in our supply chain in some new form..
Until then, it’s been a fun(gi) and educational journey working with this material, and we want to wish our suppliers continued success.
To the future,
— The Keap team