how-reduce-packaging-costs-industrial-sector

The packaging process is expensive, especially when a company wants to maintain quality and enhance brand superiority.

With the daily increase in competition, high costs of raw materials, logistics, and labour, companies must strive to reduce their overall packaging costs.

Ways To Reduce Costs

For a company to reduce the costs of packaging and at the same time remain competitive, they have to consider:

  • Available options

  • The necessary vs. unnecessary costs

  • Fragile labels

  • Green packaging

  • Shipping costs

  • Investing in testing

  • Lean inventory

Available Options

There are many packaging options available, and one box does not always fit all the requirements.

Companies must search online for the latest packaging trends to know what options are available for specific products.

Different designs, materials, and technology may work well with a particular category of items compared to what the company had in mind.

The packaging option they choose must be durable to last the product’s journey.

Before settling on one choice, companies should consider durability, environmental and pest resistance, government regulation, aesthetics, and ease of handling.

The Necessary vs. Unnecessary Costs

Companies must itemise their costs of packaging and break them down into either performance-based or appearance-based costs.

Go through the costs and determine if they can be justified. For aesthetic costs, weigh up how much they influence the product value.

If prices do not contribute to the performance side of packaging design, then they must be eliminated. Firms must answer questions like;

  • Do products require full-colour printing, information printed, and photos?

  • Should the product be put in an inner or outer carton?

  • Can taking off labels save the company money?

Fragile Labels

Everything has its time and place, including the caution notice. Heavy-duty packaging and caution notices should be restricted to truly fragile products.

Using the right material saves the company money in terms of product rework, damaged goods, returns, and replacement.

Green Packaging

Some customers prefer environmentally friendly packaging, while others are less picky.

Getting on board with green packaging initiatives improves a company’s reputation, especially with customers living in areas where recycling is mandatory.

The easier it is to recycle, the faster the product moves, which translates to revenue growth.

Shipping Costs

Light-weight materials are the most obvious choice because they are easy to handle and cheaper when shipping.

However, that is not always the case; shipping companies have a dimensional weight used to calculate shipping costs for bulky and light materials.

Sometimes the package is charged in bulk and not in weight.  

Investing In Testing

Companies must outline the packaging testing specifications describing the factors that the product will be subject to.

Then they need to formulate testing procedures and guidelines to determine if the package can withstand the environmental conditions involved.

Investing in a testing activity will help the company determine the type of packaging they should use before mass production.

During testing, the right material should counter compression, vibration, atmospheric changes, and shock.

Lean Inventory Or Volume Discount?

A company could opt to keep packaging materials inventory low.

This tactic is ideal when the company is considering rebranding in the future to avoid being stuck with old packaging materials.

Alternatively, a company may be satisfied with the packaging materials and intend to stick to the same artwork. In such cases, buying in bulk is better because printing companies offer discounts on large volume purchases.

The packaging is not only about the material, design, and printing aspects. The best choice may lead to increased labour costs.

Apart from picking the right packaging material, companies should consider gains or losses in productivity.  

Fluctuations in productivity make a significant difference in total packaging costs.  

Reducing time, workforce, and energy used to package products should also be considered.

Companies should be able to strike a balance between quality packaging and monetary gain.

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Or phone us today on 1300 855 571 with your enquiry.

We are always here to help!