Four important product packaging trends have prompted consumer goods manufacturers to rethink how they manage packaging -- and what partners are best suited to handle this important function. Logistics professionals who seek broader supply chain leadership roles must understand these trends and their implications.
Trend 1: Fewer bodies, more machines
Smart manufacturers today want to reduce labor on the packaging line.
“They want to get the product on the line and crank out millions of cases,” says Jack Ampuja, president of Supply Chain Optimizers in Amherst, N.Y.
Some third party logistics providers (3PLs) with product packaging capabilities are responding to that call, investing in automated systems that assemble products in a fraction of the time and cost required to do that work by hand. For example, at one point KANE employed 24 people to hand count different flavors of candy and place them in pouches for a client. To streamline the process, KANE developed an automated solution to turn out filled packages in the same volumes, but with just four employees.
Trend 2: Promoting sustainability through “least possible packaging.”
Environmental sustainability is a huge concern to retailers and one of our most significant product packaging trends. As suppliers, CPG companies face pressure to conform to retailers’ increasingly stringent sustainability standards.
“Least possible packaging” is a strategy many are employing. That's when you use the smallest amount of material needed to effectively store, transport, display and sell a product. One popular example of least possible packaging is the standup plastic pouch, employed these days to sell everything from soup to nuts to laundry detergent. Because they use less material than conventional packages, stand-up pouches can reduce the number of trucks a company uses to transport its products.
Consider this: A single trailer packed with flattened plastic pouches bound for a beverage bottling plant might replace a dozen trailers filled with plastic or glass bottles.
Trend 3: Supply chain integration
The third of our product packaging trends speaks more to integration of functions rather than strict packaging methods. Each time someone hands off a product – from production plant to trucker to copacker to trucker to distribution center – it adds costs and creates opportunities for error, delay and damage. One way streamline the process is to use one partner to manage both packaging and logistics.
3PLs are broadening their scope and becoming expert packagers in order to enable this growing product packaging strategy. One Fortune 100 CPG company has worked with its 3PLs to consolidate formerly outside secondary packaging operations into ten mixing centers in the U.S. and Canada. Today, the company uses one partner for packaging, warehousing and distribution -- all under one roof. As a result, the company expects to ship as much as 25 percent more volume from its DCs.
Trend 4: Single-source packaging operations
More and more “product manufacturers” are choosing to be virtual companies. They want to simplify as much as possible, and that includes integration of all aspects of primary and secondary packaging. With contract packaging services, you can use one partner to do both, and also to procure and manage packaging materials, can reduce the time involved in managing the supply chain, freeing up key managers to grow the business.
Packaging: Exploring New Options
Packaging today involves far more than bags and boxes. One key to success is to better integrate packaging with upstream and downstream functions, a perspective that comes naturally to logistics services providers. As these 3PLs continue to expand their product packaging capabilities, it may be wise to see what new options this growing capability creates for your supply chain.
To read more on product packaging trends in the supply chain, read our KANE Viewpoint: Packaging and the Streamlined Supply Chain.