Do you know the actual cost of your packaging? Hint, it’s not just your unit cost. When it comes to reducing packaging costs it’s vital to look at ways to save dollars beyond your cost per unit.
We like to think of the total actual cost as the following formula:
Unit Cost + Cost to Assemble + Cost to Fulfill + Cost to Pack-out the Box = Total Actual Cost
Let’s break down these 5 strategies to reduce your actual packaging costs.
- Reduce Package Assembly & Downtime
Most companies do not look at the labor associated with your packaging process, but it’s critical that you do. Our engineers and equipment can optimize your packaging to bring labor costs down while increasing your daily pack-out production.
We’ve worked with a company that was paying 2 people to assemble their packages. At the original rate the two employees could assemble one box in 180 seconds.
We were able to engineer a box that resulted in 1 person being able to assemble 4 boxes in 112 seconds.
How? Our engineers were able to make improvements that increased the overall structural components and utilized our equipment capabilities to make a more efficient box. The box price was a bit more than what they were paying but cost of labor was reduced by 83% saving them tens of thousands of dollars annually.
- Proper Palletization
The lifecycle of your package starts with how it leaves our building, gets to the client, and then is packed and shipped out. More products on a pallet increases your sales, makes better use of inventory space; reduces handling and freight cost. Makes sense, right? Utilizing our ISTA certified testing lab and software, we can maximize your inbound and outbound pallet utilization.
- Strong Converting Skills
Heavier paper grades come at increased costs to you and your brand. The main benefit for paying for heavier paper grades? Increased strength. However, this is not always true.
It starts with choosing the right paper combination and precise corrugating and converting processes. Our manufacturing facility closely monitors key quality criteria at each converting operation to ensure the finished product meets your specifications as well as industry standards for board performance to protect your products.
- Digital Printing versus Lithography
Lithography comes with a great deal of wasted material. These wasted materials become costs that go right into your piece price. With digital printing, you only utilize the materials you need and pay for the packaging that is produced.
Our single-pass, digital printer has an extensive list of capabilities that ensures your packaging looks perfect, saves you money, and gets to market on time.
Digital printing produces print on the top sheet that comes out of the printer, eliminates the time and cost associated with outsourcing the litho sheet, the machine labor & adhesive. Single-pass, digital printing creates a stronger sheet of corrugated as it is a non-contact print method. Versus litho which uses pressure to adhere the label causing the board to weaken. This method also eliminates holding label inventories and absorbs the cost of damage or obsolescence.
- Consistent Innovation
We do not believe in the phrase, “that’s how we’ve always done it” and that’s not how we run our business.
Abbott-Action Packaging has embraced continuous improvement in our culture. It is proven through both our investment in state-of-the-art equipment and our keen focus on the development of our employees. We also invest in tools and education that allow our design, graphics, manufacturing and sales teams to continue to innovate and create new solutions that solve your business problems. This culture extends to understanding your supply chain to reduce your total packaging costs.
This article was originally written and posted by Abbott-Action Packaging, a corrugated displays manufacturer.