The Trickle-Down Effect of Right-Sized Packaging
The average box is 40% too large for its contents and eliminating excess volume would result in 24 million fewer truckloads per year in the United States, according to DHL, The Logistics Trend Radar. With increased focus on sustainability and supply chain impacts to a company’s bottom-line, the importance of packaging strategy has never been higher. Fortunately for supply chain leaders, packaging automation has continued to evolve to address this need and the time has never been better to consider how right-sized packaging could positively impact your supply chain.
What is Right-Sized Packaging?
Traditional box packing and dunnage insertion is high in material, shipping and labor costs. Right-sized packaging aims to reduce the overall size of boxes shipped to match order sizes and reduce the environmental and cost impact of your shipments. Dim-weight shipping costs, material, and labor costs continue to rise resulting in as little as 3-6 month return on investment in right-sized packaging.
Right-sized packaging methods can be thought of in two different forms, box first vs. box last.
Right-Sized Box First
This method of right-sized packaging refers to creating the right-sized carton ahead of picking processes for an order. Packaging technologies can create right-sized cartons based on Warehouse Management System data on the order to ensure the carton is built as precisely as possible to the order characteristics. This method is dependent on having accurate system data, however the investment of ensuring data quality up front can pay dividends in the long run.
Once a right-sized carton is created, it can be routed to manual or automated picking processes. A carton can be routed to a goods-to-person workstation in a system such as AutoStore or OPEX Perfect Pick to allow for the increased benefit of goods-to-person picking integrated with right-sized packaging.
Right-Sized Box Last
This method of right-sized packaging refers to the picking process for an order occurring prior to right-sizing of the carton. In this application, technologies can create standard “tray” sizes that are able to be picked into by an operator. From there, the carton will be routed to an automated void reduction and lidding system that detects the height of the order and reduces the height of the carton to what is truly required based on the contents of the order. This method is less reliant on system attributes, however, is not quite as precise in terms of void reduction.
Alternatively, orders can be picked to tote and routed to a packing process where the order can be packed out into a right-sized carton. Orders can be inducted into a system that measures the contents of the order and “wraps” the right-sized carton around the order based on measurements taken in the system. This method allows for increased precision in carton size without as heavy of requirements on accurate system data but comes at the cost of an additional touch in the warehouse.
What are the Impacts?
The most evident impact of right-sized packaging is to a company’s overall shipping costs. Not only does right-sizing your packaging result in a decrease in costs to packaging material but it also provides a significant impact to transportation costs associated with dim-weight pricing. One Bastian Solutions’ customer was able to reduce cube space by 41% resulting in $1.3 million (6%) of freight savings and a corrugate reduction of $275,000 (30%).
According to MHI’s 2023 annual industry report, hiring and retaining qualified workers and managing talent shortage are the top challenges facing supply chain operations today. By implementing packaging automation, operations can see an increase in labor productivity associated with packing processes of 2-3X based on eliminating the need for manual carton erection and sealing. This will not only have an impact to overall labor cost but reduce the need to hire hundreds or thousands of associates to manage peak volumes.
Reducing packaging material and “air” shipped in trailers has a direct impact to our environment. According to the International Energy Agency & International Transport Forum, transport accounts for 23% of global CO2 emissions. By right-sizing packages to the true contents of an order, supply chain operations can make a significant impact in the sustainability of their operations by reducing materials required and ultimately allowing for a significant reduction in trailers used for transport.
The average package is dropped 17 times in transit. By right-sizing packages to the contents of the order, operations are less reliant on dunnage to fill space in cartons to minimize breakage. Additionally, packaging of the order can be your first impression with the customer and eliminating waste in packaging material can have a positive impact to the customer’s overall experience.
In Practice: System Integration with Right-Sized Packaging
As an independent integrator, Bastian Solutions has the liberty to select the appropriate technologies to maximize the business case for each unique application. Selecting the correct right-sized packaging technology for your application is key, however the integration of the fulfillment system around this technology has an even larger impact. Bastian Solutions customers such as PUMA have successfully designed their fulfillment systems around right-sized packaging and have seen significant benefits to their operations.
We invite you to stop by booth N-10343 at Pack Expo to learn more and see our automation solutions in action.
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