26 May 2020 Four Simple Ways to Reduce the Cost of Your DTC E-commerce Box
Direct to consumer (DTC) packaging and subscription box demand has exploded over the past 13 years we’ve been in business. For a successful e-commerce business, there’s more to it than the cost of a box.
In most cases whether you pay $1.25 or $1.50 each, the cost per box is not always the most important factor. Mailing/shipping cost, fulfillment costs, and product acquisition costs have much greater impact on your bottom line. However, we have seen that small changes in the way you design and order boxes can easily reduce your costs, increasing your profitability and more importantly enhancing your customer’s unboxing experience.
Here are four tips that can substantially reduce your packaging costs:
- Ask where the quantity price breaks are. We had one great example this morning when a customer asked for pricing on 3,000 boxes. Increasing that order to 3,500 reduced her cost by an additional 15% because the extra 500 boxes took her into the next, lower price bracket. Where those brackets are varies, depending on many factors including the amount of board required, but if you do not ask, you probably will not find out.
- Place larger orders less frequently. This advice works hand in hand with #1 above. For example, if you normally order 1,000 boxes every 4 to 6 weeks, we can help you determine the savings that results if you double your usual order. Assuming you have the space for twice as many boxes, not only is your box price reduced, so is your shipping cost. Shipping 2,000 boxes once compared to shipping 1,000 boxes two times; your freight cost savings can be over 50%.
- Are you ready to right size to a lower DTC box cost? Many companies begin their business using “standard or stock” readily available box sizes. In addition, there is a tendency for people to order larger boxes than necessary when they first start out, “just in case”. Now that you know more about your products and customers, as well as the time and cost of void fill materials, you may be ready to shrink the size of your box. Not only is that going to reduce the cost of your box, it may also result in a substantial reduction in shipping cost. A favorite customer was able to save $2.00 per box on shipping costs by reducing their size to tier one on the USPS rate chart. That is substantial when you ship out several thousand boxes each month.
- Consider modifying your e-commerce graphic design. The fact is that many people begin their e-commerce business by working with a short run digital box printer. They typically do a great job in working with people who are just starting out with low volume. Our MOQ by comparison is a low minimum for what we do which is traditional flexographic printing. Digital printing designs can be totally overdone or terribly underdone. So, at this stage, you may want to enhance or tone down your graphic design without losing your brand. Changing your box printing from digital to flexo can reduce your cost per box from as much as $2.00 to $3.00 to a dollar or less. Changing your graphic design can result in savings you can pocket or put back into your box. For example, adding inside print, or perhaps adding an insert for better protection and presentation. (see related posts below)
If you have been in operation for over a year or two, congratulations. Many new companies never make it that far so you must be doing something right, right? Think of this as fine tuning your brand, improving your unboxing experience and being able to do all that while reducing your cost per box.
Our branded packaging advisors are experts and can help you create a great looking box at the lowest possible price. You now have the volume and experience to move up to the next level of quality and image with the help of a company like Salazar Packaging.
Call us at 630-551-1700 or contact us at www.SalazarPackaging.com for a no cost, no obligation review of your current packaging design and how we can help you make it even better. Also, visit our gallery to see just a small selection of our work and the companies who trust us.