The Big Picture of a Lot of Small Stuff

The market for protective packaging, estimated at $3.3 billion in 2006, has experienced steady growth during the past five years, and will continue to do so for the next five.

I once had the good fortune to interview legendary blues singer Sam "Peg Leg" Jackson. In his self-deprecating manner, the charismatic Peg Leg told me that his luck was so hard that if they opened the doors to Fort Knox for him, he wouldn't be able to find a box to haul away the gold. If Sam was alive today his luck might be different, at least the part about finding a box to haul virtually anything.

According to recent research by PiperJaffray (Minneapolis, www.piperjaffray.com), the market for protective packaging, estimated at $3.3 billion in 2006, has experienced steady growth during the past five years and will continue to do so for the next five.

Drivers for this growth are familiar to managers in the material handling business. Small parcel shipments have increased, dramatically. Internet sales have grown exponentially, increasing the demand for one-way packaging material. Much of this, of course, is fueled by increased disposable income and consumer expenditures.

And the information I receive from the field indicates it's not all about being small. Evidence points toward a healthy business in reusable containers, as well. Big or small in size, boxes are big business.

The operative word in transport packaging these days is sustainability. So, what's new? We've been talking about reusable containers for many years now. In fact, it's hard to find an industry that is not relying on reusable containers; from lobster fishermen to car builders, it just makes good cents.

Mercedes-Benz U.S. International is anticipating a payback in 24-36 months on its recent application of 4,000 reusable containers in its manufacturing process. These primarily bulk boxes are used to move product directly to the manufacturing line. When empty, collapsed containers are loaded into the same trucks that had delivered the full containers. So the benefit is not only from reusing the containers, it goes beyond to not needing box storage space within the building—read reduced overhead. Not requiring more trucks on the road to backhaul the boxes to the Tier One and Tier Two suppliers means reduced carbon emissions and reduced fuel expenses.

I spoke with Scott Krebs, product manager for bulk containers at Orbis (Oconomowoc, Wis., www.orbiscorporation.com), provider of these containers to Mercedes-Benz, about trends in the bulk box business.

"In automotive, in particular," says Krebs, "we're seeing a lot of customers looking for inter-compatibility among the boxes they use." By this he means that bulk packaging and handheld packaging all has to work together. Big boxes need to stack with totes and smaller size loads.

The driver? It's the familiar story with a new name: lean processes. "It's still about just-in-time," says Krebs, "making sure the right stuff is in the right place in the right amount at the right time. Now managers are looking to build more efficient loads, not just filling a trailer with bulk containers. Now it's about intermixing the stacks."

And while the bulk boxes are becoming more common, there has been a parallel increase in customized dunnage that can be reused. "Managers are discovering they don't always need specialized containers," explains Krebs, "but they do need specialized dunnage to handle a wider variety of pre-assembled parts."

So, whether you're shipping gold in the form of bullion, dashboards or corn seed, the diversity of transport packaging can meet your needs, save you dollars and sustain the environment.

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