When building a business from the ground up, amidst an array of problem-solving and innovative thinking required, one issue remains constant. Costs are a fundamental metric to measure businesses, and it is a constant priority to minimise and smartly allocate funds. In the case of product-led companies which require shipping and delivery, especially common in e-commerce products, the packaging is especially important.
Packaging plays a variety of roles for a company. It has a role of practicality and utility, keeping the product safe and secure. It conveys messages around the brand narrative regarding sustainability, marketing and design. But it also has a third role; that of being cost-sensitive, ensuring that the right packing materials are chosen.
Companies such as DCGpac understand these needs very well and ensure our services cater to organisations’ various priorities and costs. This article will detail a few ways in which the right packaging material can help save money. We will also highlight some common product packaging mistakes –
Selecting the Right Packaging Materials
The first step in any endeavour relating to packaging is identifying the right material. Here, we must keep in mind that multiple packaging materials can be used depending on the context, and there is no one-size-fits-all approach. Considering the range of material choices, one can consider their budget and opt for the most consumer-friendly choice in this respect. Sustainable options must also be seriously considered in this context, considering the overarching move towards eco-friendly products also being reflected in consumer preferences.
Package size and weight
How products are packed, especially their size and weight, have a direct correlation with the costs involved. Aside from the material costs, transportation is also closely linked to this facet. Instinctively, companies tend to select standardised box sizes. While this might be a good initial approach, as companies scale up, it is important to ensure that packaging is only as small or large as the product requires. This will save on material and shipping costs, making a significant difference to the bottom line. In such a scenario, one handy tip is mailing bags, which are light and keep the product protected.
Automation + Process optimization
Another essential way to cut costs involves process optimization. This can be divided into two layers. The first and most important step is investing in training staff, which might have a high initial cost but carries long-term utility. This will also reduce the per-unit packaging time, driving up efficiency. The second is moving towards automation of certain processes. As tech grows, it is essential to move with the times. This will help reduce mistakes, cut down processing time, employee costs, as well as reduce the likelihood of injuries.
Reduce Layers and Fillers
Typically, there are three layers to packaging. These are outer, inner, and product packaging. Consumer research already suggests most prefer relatively minimalist packaging. Doing away with 1-2 of these three layers, and designing packaging concepts around that, is a smart way to go. Another measure that should be taken is reducing filler material inboxes – this includes marketing material, flyers, instruction manuals (which can be digitized), thank you notes etc. These simple steps will cut assembly time and packaging costs over the long term.
Minimize the number of Suppliers
Companies tend to diversify their basket of suppliers, assuming reliance on 1-2 sources is not prudent. However, once a leading supplier has been identified, it is important to allocate a significant portion of your packaging needs to this supplier. This will reduce costs (through bulk orders), increase incentives, and minimize the need for coordination with multiple stakeholders.
Aside from the various techniques discussed above, there are a couple of other saving options worth exploring. Conducting an external review of processes will help optimize the overarching supply chain and benefit the bottom line over future months. Further, embracing creativity and versatility when it comes to packaging choices, and keeping in mind that ‘custom’ packaging does not simply refer to design, are important aspects to keep in mind.
There are several different ways to save money through the different stages of the packaging process. The closer you look, the more likely these are to emerge. Treading the fine line of retaining quality while saving money is essential, and we hope that the money saved by employing these ideas can be put to great use in other parts of your business.
