Adam Foods: Tackling Plastic Tax with SAP's Solutions

Organisations seeking to reduce their carbon footprint and embrace circular economy principles are increasingly turning to cloud-based sustainability solutions, with SAP emerging as a key provider in this space.

The technology company's sustainability suite has proven particularly valuable for Adam Foods, a multinational producer of cookies, broths, pastries, honey and bread that serves customers across more than 75 countries.

The implementation of SAP's tools has enabled the company to meet Spanish circularity requirements whilst maintaining responsible operational practices.

Navigating new packaging legislation

Spain's plastic tax came into effect on 1 January 2023, establishing a €0.45 (US$0.53) charge per kilogram for non-reusable plastic packaging.

The levy applies to various items such as tableware, plastic wrap and food containers, forming part of the nation's broader circular economy legislation.

Adam Foods recognised the need to not only comply with this regulation but exceed its requirements by enhancing its international reporting capabilities.

The company sought to ensure circularity principles remained central to its strategic decision making.

The organisation selected SAP Responsible Design and Production as its chosen solution, partnering with Minsait, an SAP collaborator, to oversee the implementation process.

The development focused on delivering comprehensive packaging data, eliminating manual tax-form creation and enhancing tracking efficiency.

Isidro Rodriguez Ureña, IT and Digital Transformation Lead at Adam Foods, says: "SAP Responsible Design and Production improved our packaging data visibility by creating one master data source.

"We can now generate tax forms in-house to meet Spain's plastic tax mandate and proactively prepare for upcoming regulations affecting our business in Portugal, Hungary, Romania and Poland."

Understanding the technology solution

SAP Responsible Design and Production functions as a supply chain management platform that assists organisations in calculating extended producer responsibility (EPR) obligations, plastic taxes and corporate sustainability commitments.

The system offers insights that provide decision makers with a lifecycle perspective on the costs and environmental impacts associated with their design selections.

According to SAP, the system's advantages include supporting companies in fulfilling sustainability commitments, ensuring accurate fee and tax calculations and facilitating the shift towards circular product portfolios with zero waste objectives.

Julie Barrier, Global Vice President of Sustainability Marketing at SAP, says on LinkedIn: "While everyone is in the process of planning and strategising for the new year, we're continuing to deliver customer stories that highlight the business value our customers are realising with the SAP Sustainability software.

"With SAP Responsible Design and Production enabling a single source of packaging data, Adam Foods can now track regulatory impacts, optimise materials for sustainable packaging and efficiently manage and meet Spain's plastic tax obligations in compliance with European Union (EU) regulations."

Transforming operational processes

The initial phase of Adam Foods's implementation centred on examining the company's logistics chain, enabling reporting on EPR fees and plastic taxes.

The project also addressed document and invoice tracking capabilities, which had previously presented challenges for the organisation.

Access to data from SAP's platform has allowed Adam Foods to evaluate regulatory impacts on packaging across its supply chain whilst making informed decisions regarding more sustainable packaging alternatives.

The company anticipates recovering its entire solution investment through reduced tax liability resulting from the system's implementation.

Elena Castell, Tax Manager at Adam Foods, says: "Thanks to the new functionality provided by SAP Responsible Design and Production, we can now generate tax forms and track our logistics documents and invoices.

"In just the first year of filing, we expect to recover 100% of the investment through the tax benefits resulting from reliable master and transactional data."

Looking ahead, Adam Foods is preparing to extend SAP Responsible Design and Production to its operations in Portugal, Hungary, Romania and Poland during phase two.

The company is also working to maintain compliance with evolving Spanish regulations by integrating supplier sustainability data, conducting analytics for deeper insights and training personnel to produce various EPR reports.