Dominic’s Summary
The price you pay for packaging is only part of its true cost. Packing time, product damage, wasted materials, warehouse space and managing multiple suppliers can all add up. Taking a closer look at how packaging is bought, stored and used can uncover opportunities to save time, reduce unnecessary costs and make your whole operation work better.
When businesses talk to us about reducing their packaging costs, the conversation usually starts with the price of the packaging itself. How much are we paying for this box? Could we get this tape cheaper? Are we paying too much for pallet wrap? They’re all fair questions. But when we visit a customer and look at how packaging is actually being used across their operation, the price they’re paying for it is often only part of the story.
Packaging can easily become something nobody really questions. The same boxes get ordered, the same processes are followed, and the same suppliers are used because that’s what has always worked.
Meanwhile, the business around it changes. Order volumes increase, new products are introduced, warehouse space gets tighter, and what was once a fairly simple packing operation becomes much busier. Before long, the packaging you’ve always used might not be the best fit for the business you are today.
Here are some of the things we look at when we’re out visiting customers.
The cheapest box isn’t always the cheapest option.
It’s easy to compare the price of two boxes and choose the cheaper one. On paper, you’ve saved money. But what happens when that box reaches the packing bench? If it’s too large for the product, you might need extra paper or another form of void fill to stop everything moving around. It could take longer to pack, cost more to ship and take up more space in the warehouse.
Suddenly, saving a few pence on the box itself doesn’t look like much of a saving.
We see this quite often, particularly with businesses that have grown quickly. Packaging is bought to solve a need at the time and then continues to be ordered for years afterwards, even when the products or the way the business operates have changed. Sometimes, looking again at something as simple as the size or design of a box can make a difference in several other areas.
How long does it actually take to pack an order?
The time spent packing an order is another cost that won’t appear on your packaging invoice. An extra 20 or 30 seconds might not sound like much. But if your team is packing hundreds or thousands of orders, those seconds quickly add up
When we visit a packing operation, we want to see how the process actually works. Where is the packaging stored? Does someone have to keep walking across the warehouse to get it? How many steps are involved in packing one order? Are boxes being assembled by hand? Is more tape being used than necessary? None of these things on their own might seem like a major problem. But put them together across a busy day, week or year and they can account for a surprising amount of time.
That doesn’t mean every manual process needs to be automated. For plenty of businesses, manual packing is still the right approach. But if packing is taking up more time than it should, it’s worth understanding why.
What happens when packaging doesn’t do its job?
Damaged products are where packaging costs can really start to add up. There’s the damaged product itself, the replacement, another delivery and potentially a return to deal with. Then there’s the time your customer service and warehouse teams spend putting everything right. And, of course, there’s the customer who has opened a parcel to find something broken inside.
We sometimes see businesses deal with recurring damage and returns by simply adding more packaging. More bubble wrap, more paper, more stretch film. Sometimes more protection is needed. But before adding anything, we’d always want to understand why the damage is happening. Is the box too big? Is the product moving around inside? Is the pallet unstable? Is the packaging suitable for the journey the product is making?
The answer isn’t always more packaging. Quite often, it’s better packaging.
Your warehouse space costs money too.
Storage and transportation can have a bigger impact on your overall packaging costs than you might think. Packaging can take up a lot of room, particularly when you’re ordering larger quantities to get a better unit price.
We visit businesses where valuable warehouse space is being used to store months’ worth of boxes and packaging materials. They might have secured a good price by ordering in bulk, but they’re then left with the problem of where to put it all.
For some businesses, that space could be much better used for products, manufacturing or other parts of the operation. This is why we hold stock for many of our customers. It means they can order in larger quantities without having to store everything themselves, and we deliver their packaging as and when they need it.
It can also make planning for busy periods much easier. If we know a customer has a seasonal peak coming up, we can make sure the packaging is ready rather than waiting until stock is running dangerously low. After all, running out of a box that costs pennies can become a very expensive problem if it stops orders from leaving the warehouse.
How many suppliers are you managing?
We often meet businesses buying their packaging from several different places. Boxes from one supplier. Tape from another. Protective packaging from somewhere else. Then another supplier for warehouse essentials. There may be good reasons for working that way, and using fewer suppliers won’t be right for every business. But it’s worth considering the amount of work that goes into managing them all.
Every supplier can mean another purchase order, another invoice, another delivery to organise and another person to contact when something doesn’t turn up. When different departments are buying separately, it can also become difficult to see how much the business is actually spending on packaging as a whole.
For some businesses, working with a single source supplier can make things much simpler. Bringing more of those purchases together isn’t necessarily about chasing a lower price on every product. Sometimes, having fewer orders, fewer deliveries and fewer suppliers to manage can save just as much time.
Take a look at what’s going in the bin.
We learn a lot by walking around a customer’s site, and sometimes the waste bins are as useful as the packaging shelves. Offcuts, unused void fill, excessive stretch film and damaged packaging can all give you an idea of where materials might not be working as efficiently as they could.
You’ve already paid for anything that ends up in the bin. In many cases, you’re then paying again to have it taken away. But reducing waste doesn’t mean stripping packaging back until products are no longer properly protected. A damaged product is likely to create far more waste than the small amount of packaging that could have prevented the damage in the first place. It’s about finding the right balance and using the right amount of packaging for the job.
When did you last look at your packaging as a whole?
Most packaging decisions aren’t made all at once. A new box gets added because a new product launches. A different supplier is introduced because someone finds a better price. Order volumes increase, so the packing process changes slightly. Another material gets added to deal with a problem. Each decision probably made sense at the time. But after a few years, you can end up with a packaging operation that has simply grown with the business rather than ever being properly reviewed.
That’s why, when we visit a customer, we’re interested in much more than the price they’re paying for a box.
We want to see how packaging arrives, where it’s stored and how it’s being used. We’ll talk about damaged products, waste, busy periods, suppliers and the things that cause frustration for the people actually doing the packing. Quite often, the opportunities we find aren’t where the customer expected them to be.
It might be a different box size. It could be changing how stock is managed, looking at automation or bringing several packaging purchases together. Sometimes it’s simply changing a process that has been done the same way for years. And sometimes, what a customer is already doing is exactly right. The point isn’t to change packaging for the sake of changing it. It’s to understand what it’s really costing your business and whether there’s a better way of doing something. Because the price on your packaging invoice only tells you what you paid for the packaging, but it doesn’t tell you what your packaging is actually costing you.