Tips to Save Costs on Packaging

As a manufacturer, you package your finished product and ship it to a distributor, customer, or sometimes even an end user. Your focus is mostly on the product. You ensure it meets customer specifications regarding quality, quantity, and on-time shipping. Often, little or no resources focus on its packaging. The product is placed in a box and gets shipped.

Some of your customers might not have specific packaging requirements and are content if their product arrives in any box. However, if the product arrives damaged, they will be unhappy. If your customer has no specific packaging requirements, spend some time analyzing what could go wrong during shipping. Investigate to see if you can improve your packaging to prevent product damage. You may decide to add bubble wrap, packaging peanuts, more cardboard, or shrink-wrap—any of which will increase your packaging materials and labor costs. 

Or instead, you may want to consider designing packaging that is specifically made for the product. Many large companies have added packaging engineers to their staff. Small and midsize companies often can’t afford this expense, but they may be able to contract with a packaging manufacturer or ask if their customer has resources available.

When designing or selecting packaging, you should consider the following:

• Proper product protection. What is the size and weight of your product? The packaging should be built to contain the product and not leave a lot of room for air. If you have a fragile product, you need to think about how you can protect it. If there are regulations for shipping your product, be sure to abide by those laws.

• Ease of use. Make sure it is easy to package the product as part of your daily operations and the customer can easily unload the package.

• Storage and distribution. Be sure the package can handle the temperatures it will come across while being transported. If you need special labels, do that upfront. Don’t rely on the shipper to add those.

• Cost. It is important your products arrive safely and in one piece without adding too much cost. Consider how often you are shipping products and whether you can use a standard size package or basic materials.

• Sustainability. Think about how the package will affect the environment. Your product might be best shipped in a package that can be easily recycled, or the customer may even be able to reuse your package.

• Automate your packaging operation. This can be a cost saver if you are working in high volumes with consistent sizes.

There is a lot more to packaging than just putting things in a box. Packaging needs to be looked at as a storage, shipping, and end-user container. And it doesn’t have to be a costly endeavor either. It can be a value added to your product. For example, if you bottle liquids for different private labels, work with customers to understand what the end user might be able to do with them. You can then design a bottle or container that could be repurposed after the product is used up. You can also work with your customers to design a shipping container that all of them can use. For example, if one customer asks for 12 in a box and the next asks for 8, you would have to maintain stock for two different sizes. If you could switch to a single size for both customers, you can reduce packaging inventory and part numbers, resulting in a better price from your supplier.

Don’t underestimate or ignore the importance of packaging. Consider packaging costs as well as the opportunity to turn packaging into a value-added proposition for your product. The decisions are up to you.