Packaging is one of many issues a firm must address when developing a MARKETING STRATEGY. At first glance, packaging seems like a relatively simple concern; it is needed to protect the PRODUCT and communicate what is inside. However, marketers have learned that, in addition to protecting and promoting a product, packaging needs to be cost-effective and environmentally sensitive. The first packaging consideration is protecting the product. Consumers do not like to purchase damaged goods; returning such products is a hassle for them and is also an expense for businesses, creating the potential to lose customers. Businesses often test product packaging to avoid selling damaged goods. In addition to protecting against damage, packaging can prevent spoilage, reduce pilferage, protect against being opened by children, and guard against product tampering. The Tylenol scares in the 1980s, when Johnson & Johnson removed their product from shelves after a few bottles had been laced with poison, was one of the most dramatic examples of protectivepackaging concerns in recent American business. A second consideration in packaging is its role in marketing. In some consumer goods categories, colorful, descriptive packaging is a major factor in a product’s success. As part of their mission, Celestial Seasonings Company states that their packaging is “aesthetically pleasing.” Packaging should bring attention to the product, allow a good fit on store shelves, and provide information about the product and its benefits. The Fair Packaging and Labeling Act (1966) requires firms to provide adequate information about the contents of a package and facilitate consumer comparisons with competing products. The Nutrition Labeling Act of 1990 requires a uniform format for labeling of food products. Cost-effectiveness is an important consideration in packaging decisions. Packaging should be lightweight and should facilitate unitizing (gathering of cartons into one unit), palletizing (placing cartons on a pallet), and stacking. Today most large manufacturers have automated unitizing and palletizing systems, greatly reducing the cost of packaging. Whether the work is done manually or with an automated system, businesses compare the COSTS and benefits of customized packaging versus standardized box sizes and the many alternative kinds of dunnage, the protective material that goes into a carton (i.e., wood, paper, plastic, foam, air, or starch). Increasingly firms are using air, because it is inexpensive and lightweight. A few firms are using denatured cornstarch, a biodegradable type of dunnage. This and other environmental considerations are becoming more important in packaging considerations. The EUROPEAN UNION Directive for Packaging and Packaging Waste (1996) set packaging targets of recovery, recycling, and reuse. While the United States has not set environmental packaging mandates, some states and municipalities are requiring recycling. Some European firms operating in the United States, such as BMW, require their suppliers to be responsible for any packaging used to ship products to the BMW factory in South Carolina.