After a year and a half of multiple, double digit price increases, spanning 2021 and into 2022, it is so nice to be able to offer some good news. One decrease was announced in November 2022 and implemented in December 2022, followed by a second decrease that was announced in December 2022, but was not implemented until January 2023. There is a typically a 30 day or more delay in the corrugated market for any increase or decrease, allowing for notices, inventory reductions, etc.
While these two decreases are smaller than last year’s increases (the industry does not give up any increase enthusiastically), experts are predicting more decreases will follow in 2023 as additional capacity comes online and if demand continues to slow down. Remember this all follows 2021 and 2022 when manufacturers were selling everything they could produce, thanks to Covid. So maybe, the old norm will once again become the new norm. We can only speculate.
Lower costs for box and shipper buyers!
As always, pricing between one plant and another, can and do vary, and as we have learned, different parts of the country are impacted differently by corrugated industry increases and decreases.
However, if your supplier has not reduced your pricing the last few months by at least 5 to 6%, they may be intentionally or unintentionally not keeping up with the current market. To be fair, they may not have passed along all the increases to you last year, so they may be trying to recover some of their lost margin. That is not unfair but may not be wise as customers like you work very hard to offset box and mailer costs that could have increased as much as 30% in the last couple of years. The bottom line takes a big hit with any increase like that to any line item.
Explore all packaging cost reduction options!
If you are a regular reader of this blog, you know that we believe the best and most impactful way to decrease corrugated costs is by using less corrugated through sustainable and intentional design. Other creative ideas include modifying your design from an expensive litho label or digital design to something more subtle for repeat customers. Perhaps only using the more expensive designs for influencers and new customers. Or totally shifting from die cut mailers to inside/outside print RSC style boxes at half the cost.
The posts you will find in this blog are filled with ideas that will reduce box cost, shipping costs, and 3-PL assembly and packaging costs. What is the best way for you to dramatically reduce your cost per unit? Why not talk to an expert who has the experience helping other companies, just like yours!
Call us at 630-551-1700 or contact us via this link so we can begin the dialogue that will result in great savings for you and your company.