Nothing will correct a vendor’s bad behavior quicker than an angry customer. And where e-commerce is concerned, many vendors aren’t even aware of their bad behavior until they get a “correction” from a customer. Much of this bad behavior is related to packaging. There’s either too much or too little of it, and either way, it can result in a poor customer experience.
Too much packaging adds to shipping costs and disposal challenges; too little can lead to product damage. According to Jack Ampuja, president of Supply Chain Optimizers, a consulting firm specializing in packaging optimization, the typical e-commerce shipper achieves 60% cube utilization with its packaging, meaning they are shipping 40% filler and air. This is costly both to the transportation budget and to the company’s reputation for sustainability—if they have one.
Packaging rationalization isn’t rocket science, but it’s not intuitive, either. In fact it can be downright counterintuitive. Some shippers might think that reducing the number of box sizes they use would make a big difference in packaging costs. It can. It can actually end up being more expensive when factoring in lost cube utilization, and extra material and dimensional weight. Ampuja says one client actually ended up spending an extra $200,000 annually after replacing three cartons with one universal carton.
Packaging rationalization is becoming low-hanging fruit as more companies enter or increase e-commerce. Even packaging vendors that have made their name selling engineered packaging are finding opportunities helping their customers engineer solutions. I talked to Lance Wallin about this recently. He’s executive director of global packaging systems for Sealed Air, and he told me that one of his company’s initiatives is to identify for customers the products that don’t need a shipping container and can go into a mailer instead.
“That’s been a growth area for us because there are a lot more durable products and smaller profile products that can fit into a mailer as opposed to a corrugated container that will likely require fill,” he said.
This and other approaches to packaging optimization are regularly handled via his company’s “Smart Life Insights,” a website that enables customers to consult with them over such matters. Wallin says the number one offense his customers commit in serving their customers is damaged product. Product damage has multiple costs tied to it.
“You double or triple the carbon footprint to replace that product,” Wallin says. “Our customers want to get their products into customers’ hands as quickly as possible, and with Amazon focused on same-day service in the large metro areas, the challenge is taking up the least amount of space.”
The point is, transport packaging is about much more than packaging. It should be designed to protect not only your products, but your company’s reputation.
