One Size Might Fit All, But It's Costly

April 1, 2007
A reader called with a transport packaging frustration. She had ordered a 10-pack of her favorite pens from her big-box office supply store, along with

A reader called with a transport packaging frustration. She had ordered a 10-pack of her favorite pens from her big-box office supply store, along with four pens of another type. She was promised free shipping because the pens were not on the retail store shelf.

Three days later the cartons (as in two) arrived. Rattling around in one carton, (14 x 20 x 14 inches) was her 10-pack of pens. In the other carton (12 x 10 x 3-inches) loosely wrapped and padded with air pillows, were her four red-colored pens.

So her question to me was, "What's with these guys? Where's the profit? What's the point?"

What's the point, indeed? I called one of my transport packaging sources, the knowledgeable Bill Armstrong, technical development manager at Sealed Air (Danbury, Conn.). Bill has been working with clients for many years, developing packages that serve and protect. The mantra there has long been "light is right and less is more."

I learned that the rules in the shipping game have changed. Bill did his best to help me understand the concept of actual weight (of a package) versus dimensional weight, which is really not about weight but about size. Yes size does matter. With small packages, virtually all carriers base their charges on dimensional weight—or the cubic space occupied by the box—not the actual weight of the box, up to a point. Carriers put their own spin on the rules so it gets complicated.

"Carriers are trying to maximize revenues and use of their vehicles," says Armstrong, "Trailers have a finite volume and a weight limit. When you're billing by weight, the optimal load would be one that fills all the space at the same time it maxes out the weight."

So, if you're shipping lightweight stuff (like pens) you're not paying much for trailer's cube. To get their revenues, carriers base dimensional weight on an assumption of nine pounds per cubic foot. A package that occupies three cubic feet and weighs only two pounds is thus billed as weighing 27 pounds—the dimensional weight of the three cubic feet. If that same three-cubic-foot package weighs more than 27 pounds the shipper gets charged for the actual weight.

So why ship a few pens in a big box? Why, indeed. It's a really bad idea. If the carton reaches the threecubic-foot threshold (or whatever the parties negotiate as the threshold), cha-ching! The shipper now pays his fare share for filling the trailer.

You can't blame carriers for trying to make a buck. Given the volatile cost of fuel and the increasing number of stops trucks make, their costs have exploded. The good news is that small parcel orders have been skyrocketing as well, so business is good these days. Armstrong warns that discussion on this topic is a challenge given the variables among carriers and shippers, products and transport packaging material.

"Our sweet spot has always been to look for high performance with low-weight material," says Armstrong. "But now, this puts a new twist into our approach. The cube has become critical. If a shipper can reduce his transport packs below the threshold size of the carrier's dimensional weight rule, and maintain protection, he can save money because he's back to being billed for the actual weight."

But why use...? Because, maybe the shipper bought a lot of big boxes to be sure all orders could be accommodated?

What can a shipper do? Armstrong suggests starting with a review of the carton-size mix currently in use. Downsize the cartons. Add a few sizes to fill the gaps between sizes rather than using a big box filled with air.

And what about that free shipping? As Armstrong notes, common sense tells us there is no such thing as free. Costs are built into the price. "There are a growing number of consultants and computer programs that specialize in massaging the variables to find the price-point at which the shipper can offer anything for free."

Clyde Witt has been reporting on transport packaging issues and trends for more than 20 years.