(Sept. 13) Executives in the reusable plastic container business don’t put much stock in a recent study that makes a gloomy forecast.

“There’s a lot of industry left to penetrate,” said David Rodgers, senior vice president of Orbis Corp., Oconomowoc, Wis., and president of the Reusable Pallet & Container Coalition, Washington, D.C.

The Cleveland-based Freedonia Group, an independent market research firm, reported in its produce packaging study that demand for new RPCs grew by 60% from 2000 to 2005 but that growth in demand likely will decline during the next four years.

Freedonia analyst Esther Palevsky said it was unlikely RPCs could sustain that growth because there are only three retail chains — Wal-Mart Stores Inc., Bentonville, Ark.; H.E. Butt Co., San Antonio; and Colton, Calif.-based Stater Bros. — using RPCs in large volumes. She also pointed out that the containers can last for several years.

NO QUICK JUMP

Fred Heptinstall, president and general manager of the RPC division for IFCO Systems NA, Houston, said there were at least three other retail chains — which he declined to name — taking a serious look at RPCs. Heptinstall said the decision to switch takes time and study.

“It’s not something you’re going to jump into quickly,” he said. “It’s a whole system change.”

A drastic switch from disposable or recyclable corrugated to reusable plastic has proven to be too big of a leap for many retailers. Despite having the world’s largest retailer on board, RPCs still account for less than 10% of produce shipments in the U.S., Rodgers said.

Heptinstall, however, said RPCs are gaining acceptance.

Some retailers had reported 75 cents to $1 savings per carton with RPCs because of a variety of factors, including reduced shrink and the elimination of disposal costs, he said.

Rodgers said one retail chain, which he declined to name, has been testing RPCs since January with positive results. Rodgers said the retailer started with one commodity and has since expanded to more than 70 stock-keeping units in its wet vegetable line.

WAL-MART

Adding another retail chain isn’t the only way RPC demand will increase, Heptinstall said.

“There’s still significant growth opportunity just with Wal-Mart,” he said. “Whether another retailer comes on or not, we can sustain that growth.”

Wal-Mart announced earlier this year that it planned to open 1,500 stores in the next few years. The retail giant already has more than 3,200 stores in the U.S., including about 2,000 supercenters. Wal-Mart said it planned to open more than 300 stores by the end of 2006.

“We’re going to be opening tons of stores,” said Bruce Peterson, senior vice president of perishables. “We’re going to grow in the RPC business.”

Peterson said Wal-Mart is looking at plastic bins for large bulk items and would love to see the industry introduce an RPC that could be used in banana ripening rooms.

“We’d jump at that in a heart beat,” he said.