Posted on June 5, 2012 by Dennis Salazar

When Custom Packaging Can Save you Big Money

There are times when custom packaging can save you money. The word “custom” has been known to scare the daylights out of people because the assumption is that custom packaging will always cost more, maybe a LOT more, compared to stock packaging. The fact is that many people buy and use stock products when they should be using custom and they are paying dearly for that mistake.

For example, a right-sized packaging container can save money a variety of ways that are frequently overlooked. There are three common reasons why many people continue to buy an incorrectly sized product:

  • Habit – even though needs and the application may have changed (examples: product size, order size, volume, etc.) many people are stuck in the habit of using the same product and buying it from the same supplier
  • Time – reviewing packaging often appears on the “to do” list but rarely gets accomplished. It seems there is always a bigger, more urgent problem that can demand our attention.  Combine this with a little of the old “if it isn’t broke…” mindset and packaging can go ignored and uncorrected, for years.
  •  Perception – people are often convinced they can’t afford the product because of set up or in some instances, tooling costs required by certain types of custom packaging.

An Actual Example

We were asked to review an application in need of a lower cost void fill solution. The customer knew that the void fill product they were using was expensive and labor intensive. We reviewed their current shipment set up, including the product they were shipping, the void fill and “stock” die cut mailer they were using. After a few questions we recognized they had a container problem, NOT a void fill problem.

It seems they have been using the same stock, die-cut mailer for several years which they had been buying from the same, well-known, internet packaging supplier. Over time, the product had become smaller but the box size was never modified to keep pace with the changes. The result, a substantial increase in volume that needed to be filled.

We determined the right size corrugated mailer was quite a bit smaller in terms of length and width, and we were even able to reduce the box height from 6” to 4”. By minimizing the cubic space, we were able to easily and dramatically reduce the amount of void fill required for each box.

In addition to a lower box cost and a reduced void fill cost, we were able to minimize labor and the box height reduction enabled them to stack 50% more products on each pallet, resulting is huge savings of space and shipping cost.

Of course the “custom” die cut mailer required a custom die but their volume combined with all of the above savings, made it easy to justify the onetime cost. In fact, the savings were so substantial that the cutting die cost was offset within the first 30 days of using their new custom size box. Not a bad ROI!

Is Custom Packaging Ever the Wrong Decision?

Yes. In all fairness we have also met many customers who are using expensive custom products when a stock item could and should save them a lot of money. Most of the time, it is because the packaging user has not been educated on the options they have available. We offer a wide variety of stock/standard packaging products and solutions, as well as an assortment of products we refer to as semi-custom.

For example, corrugated build outs and inserts that are able to be quickly and inexpensively cut to size, possibly eliminating the need for much more sophisticated and expensive products.

Custom packaging should only be recommended when it is truly the best or perhaps the only solution available. One of the largest determining factors continues to be volume. If we ask the dreaded “how many” question early in an application review, it is only so we can determine if the need is best satisfied by a stock or custom solution. It may seem unfair but the truth is that there are many more options available for most large volume applications.  Many packaging options are cost prohibitive for low volume or for a temporary need.

Selling Boxes versus Selling Packaging

There are many places you can buy corrugated boxes ranging from your local UPS store to the internet.  As your needs change and grow, you may find yourself in a situation where you need a packaging consultant, not just an order taker (electronic or otherwise).

In addition, an experienced packaging consultant is able to consider ALL aspects and components of your packaging including void fill and even how you tape or seal your boxes. Self-diagnosis of a packaging problem will often result in an incorrect treatment and solution.

I will make one blanket statement and that is that those large catalog packaging operations are ideal for people who buy small quantities of many different products.  If however, you are using thousands or even hundreds of any packaging product, you can probably benefit from having a relationship with someone who knows more than SKU numbers.

Please contact us if you would like us to review your packaging needs.

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