HOW CAN OPTIMIZE THE COSTS OF PACKAGING MATERIALS

Cheap is expensive. And, when we talk about “cheap” and “expensive”, we not only refer to an economic investment, but also to the importance of knowing how to use resources and entrust them to expert professionals. Some companies, whether due to ignorance or seeking to reduce costs to their competitors, use materials that may be more economical, but in the long run they seriously affect the reputation of their products. In this article we will see the keys to follow to achieve cost savings related to the packaging material. Join us!

Am I using the best material to package my products?

It’s important to determine the quality of the package, although this, that question will not give you the solution. You should know that all research arises from a doubt, so this question is important to start considering the details to evaluate.

If you have never done a study of packaging materials, it would be ideal to propose a project to optimize these materials. The first step is to determine if the packaging material used is of adequate quality for the product to be protected, because the inappropriate quality (superior or inferior) is related to economic consequences:

Economic consequences linked to superior quality material

• Higher material costs: a material of superior quality to the appropriate one corresponds to higher costs in its purchase, since it could be more elaborate material, with more quantity of raw material, or even with 100% virgin raw material.
• Higher costs in the Green Point declaration fee: the expense in the Green Point declaration corresponds to the amount of material available on the market (weight) with respect to the rates established for each material by Ecoembes.
• Negative impact on sustainability: the use of superior quality packaging product can be related to the use of more quantity of material, and therefore, use od more resources and production of more waste, in the same way that it can be related to the use of less recycled material.

Economic consequences linked to inferior quality material

• Increased number of incidents in the packaging process: if the package does not meet the expected quality, it will cause machine shutdowns, non-compliance with specifications and, in some cases, accelerated product deterioration.
• Increased number of nonconformities and incidents: if the package is not able to support the weight of the product or the humidity conditions, if it does not have the capacity to provide safety and quality to the product, it leads to a loss of the initial properties of the product, such as loss of aromas, moisture changes, growth of microorganisms and colour change. This taken to the extreme, could even increase the number of customer claims.

How can we determine the quality of the packaging?

To determine the quality, it is necessary to carry out a study of the inventory of the packaging material and have expert knowledge to be able to know in which situation it is.

The second step for the material optimization project is to determine which material offers the quality properties that the product to be packaged requires. Different parameters must be considered, which will vary depending on the packaging material, the packaged product and the transport and storage conditions, in order to determine the necessary quality of the packaging to protect the product and keep it in the proper conditions.

Is my supplier the one that is offering the best commercial options?

Starting from the appropiate quality for the packaging, we can answer this question by conducting a market study, considering the price, supply volumes, storage conditions, transport and palletizing, after sales service …

If we compare the offers of the same material between different suppliers, we see that the economic offers and the commercial conditions differ greatly from one supplier to another, this together with the large volumes of packaging consumed annually, makes changing from one supplier to another, even being the same material, generate significant cost reductions.

We are at the point where we know the appropriate quality of packaging for the product and the supplier that offers the best commercial options. The last step is to standardize the packaging material to verify that it is really suitable for the protection and preservation of the product, at the same time as maintaining the integrity of the packaging throughout the life cycle of the product.

Case-study

In order to show you the economic savings that can be derived from the optimization of packaging costs we propose a real case study:

It is a meat industry that packs in different materials such as cardboard boxes, trays and film, and wants to optimize the costs of your company’s packaging, but for lack of expert knowledge related to packaging materials and, above all, for lack of time, he can’t do it and he hires RepaQ for it.

RepaQ ‘s team starts up and carries out the study of the inventory of one of the packaging materials used by the industry, determining the situation in which the customer is and, searches and finds the appropriate quality of the packaging for each of the references. In agreement with the client, it conducts a study of suppliers to find the best offers of commercial conditions and chooses which containers should be approved. All this translates into a saving of almost € 100,000 only in one type of packaging material.

As you can see, there are different variables to consider when saving on packaging. However, it all sums up the need to choose the qualified staff to carry out the necessary studies and know what your product needs to have the highest possible quality, and always provide a good image. All this will translate into profits for your company, and the objective will be accomplished.

In RepaQ we have extensive experience in cost optimization of packaging materials, we will carry out a personalized initial study and we will offer you the best alternatives both in materials and in suppliers. Contact us!