Paper users struggle with scarcity, higher prices - Grand Rapids Business Journal

2022-08-27 23:38:46 By : Ms. Jojo Hou

“Necessity is the mother of invention,” a quote attributed to Plato, found some meaning this summer when Doug Lee, owner of Jam’nBean Coffee in Cascade, ran out of paper bowls for ice cream.

He noticed he had a glut of the plastic dome-shaped lids and started using them as bowls instead. It was a quick, cost-effective solution to what’s become an ever-growing problem: paper product scarcity.

“Anyone who uses paper can tell you about the cost and scarcity (of paper products),” said Andrew Krell of Krell Paper Stock, a Grand Rapids-based paper recycling company that buys paper “by the truckload.” The discarded bulk paper is then used to make recycled paper products. Krell said paper of certain “grades” is more scarce than it used to be and explained that fewer people going to work in offices during the pandemic led to less recycled paper for the supply chain of a product that’s a figurative ouroboros (a snake eating its tail), because paper is used to make … more paper.

Since there’s less copy paper, envelopes, invoices, checks, etc. being consumed and discarded, there’s less recycled paper with which to make new products. Conversely, the amount of used corrugated cardboard is more plentiful than before the pandemic, likely due to an increase in direct-to-consumer shipping by companies like Amazon, so that’s making up for the lack of finer grades of paper in the supply chain

But paper products used in the foodservice industry aren’t supposed to be made from recycled paper, so what’s the problem?

For Lee, the excessive price point of the paper ice cream containers is a big part of the issue. They’re just too expensive. Restaurant suppliers offer big chains and bulk consumers discounts for purchasing large quantities. Jam’nBean doesn’t need millions of paper ice cream bowls. It needs thousands, or maybe even hundreds.

“They really sock it to the little guy,” Lee said.

That’s the first issue.

The second issue is that Lee likes to purchase American-made products. He said he believes that an increasing number of American companies have become more inclined to purchase American-made paper products, putting further pressure on his suppliers.

Melissa Polanco, who owns the Ring of Color makeup line, said she prefers to buy American-made paper products, too, but the price of the boxes she usually orders from an Ohio-based company has risen since the last time she placed an order — so much so that she then opted for boxes made in China — and she’s still waiting for those boxes from Ohio to arrive.

Lee faces a similar predicament.

“I have bowls coming in now, but yes, there was a shortage. I couldn’t get them before,” said Lee. “It’s even harder when you try to buy from American companies.”