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Are you ignoring packaging optimization and losing profits?

Author Cara Posey on 8/3/17 2:05 PM

Your packaging strategy has a direct impact on your bottom line. If you use too much packaging, you incur unnecessary costs in materials and carrier charges. Use too little, and you fail to protect your products, leaving you with significantly higher costs to replace the original items and send them to the customer a second time.

What may seem like only a couple of dollars wasted at a time, when you have thousands of boxes shipped every month, can quickly turn into thousands or millions of dollars lost every year.

Let’s explore a few of the main reasons why packaging optimization should be a priority.

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Save money on packaging and carrier costs

If you’re sending boxes that are too big for your products, that few extra cents for the box, padding, bubble wrap or void fill all adds up. The cost of these extra materials will affect your profit margins.

If you’re shipping bigger packages, this excess weight and size will also raise your shipping costs. Shipping giants UPS and FedEx have already introduced new dimensional pricing systems in the last three years in a bid to curb retailers’ large packages, as well as capitalize on their usage.

Incorrect packaging is easily avoided by instituting a few preventative measures:

  • First, use smart auto packing within Pacejet to make sure ecommerce websites and sales order processes better estimate the impact of packaging. This will help ensure you're charging customers enough for shipping.
  • Second, conduct thorough staff training on how to correctly package your products to minimize waste and avoid overages.
  • Third, ensure adequate packaging is always available based on your product sizes. This stops staff reaching for any available box and sets your packaging department up for success.
Staff can also use tools like a Cubiscan to ensure products are measured and weighed properly, avoiding excess charges. Pacejet has a new integration coming soon to help automate the use of these tools.

With inflated costs for larger packages, businesses must think carefully about whether the packaging they choose is really the best size for the product.

 

Avoid damaged products

On the other hand, if your packaging is insufficient, this could mean your products are damaged during transit. This impacts not only the opinion your customer forms about your brand, and their overall satisfaction, but adds costs to buy, pack, and ship a brand-new product.

If you take time to train your staff to use the right size box with the right protective materials in the first place, and then measure and weigh it accurately, you can easily avoid potential cost leaks, as well as unhappy customers.

 

Appeal to the consumer

From a customer’s standpoint, packaging really does matter. Oversize boxes can leave the consumer frustrated with the level of packaging they need to dispose of. But not only that, recent research shows consumers are increasingly looking for recyclable and sustainable products and packaging as society becomes more environmentally conscious.

According to a study by Perception Research Services, out of 1000 consumers involved, 36% were more likely to choose eco-friendly packaging, and half were willing to pay more for it.

It's important to remember that packaging optimization not only maximizes your profit margins, it delivers a better experience for your customers, aligns with new consumer beliefs, and gives a better impression of your brand.

 


About Pacejet

Pacejet transforms the shipping dock into a launching pad for profitability. This starts with a best-in-class cloud-based solution, surrounding it with the consultative support that enables customers to thrive in the 21st century shipping economy.

For more information on Pacejet shipping software, visit http://pacejet.com, call 877-722-3538, or email info@pacejet.com.

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Topics: Tips and Tricks, Articles, Strategy

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