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Reducing Packaging Costs in Ecommerce Era

Bubble Wrap

It’s no secret that online retailers are gaining serious market share of U.S. consumer spending across the majority of major U.S. industries. Yesterday, Best Buy announced that their revenue decreased over 90% from one year ago (I certainly do not attribute this huge decrease to slowed consumer spending…)   But how can a “big box” store like Best Buy compete with these smaller companies with substantially less overhead: warehouses of ready-to-ship packaged items, no storefront rent/insurance, no retail employees, etc? Is it even possible?!

People across industries recognize the importance of packaging, such as Travis Tillotson, Managing Director at Surgo Group (a New York based digital agency) who stated “The continued rapid growth of ecommerce sales is forcing companies to do massive overhauls of their online strategy as a whole.  A major part of this among these Fortune 500 companies is improving efficiencies….and finally, cutting costs on items such as….shipping and packaging.”

4 Simple Packaging Insider solutions that help reduce your shipping costs:

1) Corrugate/Box Costs:

-Never pack something in too large of a box

-If product doesn’t need thick corrugate to hold it, then don’t use it

-If box is not on display, keep it simple 2-color print(customers want deals)

2) Shipping/Packaging in Pallets

-Palletize items to maximize space in trucks

-If possible, determine if pallets can be stackable–because if so it can cut your shipping costs in half

3) Use cost-effective alternatives

-If something does not need bubble wrap, don’t bubble wrap it

-If you can make something lighter without jeopardizing integrity do so

4) Stay Current with pricing/methods

-Shop suppliers such as Pulp and Paper magazine to keep tracks of specials

-Check current price of paper at ALL times

“Consumers are expecting more from their retailers, but for the same price they can get on-line. Major retailers now have to compete with point-of-purchase Google searches prior to decisions being made as well…most are not even aware of how to combat this properly….improving efficiency and cutting costs from a big picture perspective is so fundamental that large companies often overlook simple price reductions such as….and packaging ” states Mr. Tillotson.

So who says packaging is not important?

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  • http://twitter.com/LibertyPkg Liberty Packaging

    We’re a huge fan of more efficient packaging materials and methods! As noted above:
    “…improving efficiency and cutting costs from a big picture perspective is so fundamental that large companies often overlook simple price reductions such as….packaging ”

  • Pingback: Reducing Packaging Costs in Ecommerce Era – Packaging InsiderPackaging Insider | packagingyourfuture()

  • SwansonPack

    Very helpful article. I currently run a shipping/distribution company(DSD) and it gave some very helpful advice.

  • raiman25

    Nice article,from this article i am realizing that packaging is more important and i like the efficient packaging method.I think this article helpful for new people who wants to run a shipping company.

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  • http://www.facebook.com/maricela.martinez85 Maricela Martinez

    These tips are really helpful, i searched a lot over internet about efficient packaging solutions and finally got this post. Thanks for the article i have been following this tips now :-)

  • http://www.facebook.com/mark.lopez85 Mark Lopez

    In this ever increasing competitive e-commerce world, price plays an important factor. Reducing packaging cost ultimately reduce the price of the product and this attracts good no.s of sales. We sell our products online and we have largely worked upon cutting packaging cost, which really helped us provide best price to our consumers.
    Thanks for this article!

  • http://www.facebook.com/mike.smith1010 Mike Smith

    Packaging in today’s world plays very important role .. however, spending much on packaging is not a great idea and it increases price too. To be competitive enough packaging cost should be minimized..

  • http://www.facebook.com/sheryal.ferguson Sheryl Ferguson

    Nice article, quite useful .. Thanks!!!

  • http://www.facebook.com/staci.holmes.31 Staci Holmes

    Many consumers love attractive packaging, designers should emphasize on giving attractive packaging at minimum cost…

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  • http://www.airbubblepack.com/ airbubblepack.com

    Very informative, these tips are very useful..