Lester Barratt, Sealed Air’s strategic markets and accounts director, assesses the role packaging will play in logistics operations with the rise in ecommerce and expectation for a better customer service.
The unrelenting rise of ecommerce and a new age of global trading are pushing supply chains to breaking point and forcing even the most antiquated retail logistics operations to innovate for fear of falling behind competitors.
As businesses seek to out-run the competition, they are turning to their logistics operations to give them the edge. Just in the last two years, lead times for a whole swathe of operators have been reduced from two to three days to less than 24 hours. Stability in the marketplace is no more.
A new dynamic environment has come to the fore. Logistics professionals in the retail sector fight in all corners for maximised productivity, sometimes succeeding, only for the next demand to take the wind from their sails. It’s a cyclic battle. A precipice of innovation has emerged, with some businesses driving fresh thinking and revitalised operations and taking bold steps into the future, while other traditionalists remain stationary hoping for a stay of execution.
Packaging can act as a stimulant throughout the supply chain, giving operations a competitive edge and boosting productivity, providing a proven impact on the bottom line.
Every second counts
A major consideration for logistics professionals in retail is packaging line speed. Identifying bottlenecks on the line such as labelling; leaflet insertion; sizing; end-of-line processes and packaging material choices all contribute to the individual line speed and can be improved through the correct packaging solutions.
Shrink films can cause unnecessary downtime and energy expenditure. Many in the industry are still using 15-20 micron shrink films. However, with packaging constantly evolving, we recommend looking for shrink films that are now being supplied at just 9-11 microns. More metres on a roll will see them last longer on the line, reducing the required scheduled down time for switching rolls, with the ultimate impact being more products packaged per day. There is also a positive environmental impact, with more energy savings due to the higher volume capabilities.
You should also consider reducing the bottleneck with packing line automation, by rethinking your conveyors, such as multi-lane or helical conveyors. You will find that there are packaging systems available that have the ability to integrate with the conveyers and packing lines selected, resulting in an optimum flow and speed.
Often the improvements in infrastructure and working practices of logistics operators do not match the growth in demand faced. This not only places pressure on logistics professionals to rid their business of deficiencies, but also to push processes once deemed efficient to an even more productive point.
Reduced transit and storage space and costs, a reduced packaging inventory, and more room for and accessibility to stock are all benefits of space efficient packaging solutions. But it is also crucial that whilst minimising the volume of packaging being used and stored, businesses need to maximise the protection their packaging is providing.
For example, specialised packaging foams can expand on site up to 200 times their liquid volume, allowing companies to benefit considerably from reduced inventory, space and also requiring less handling than other more traditional packaging materials. There is a big move to this just-in-time packaging across the logistics sector because the market is demanding it – especially within the new ecommerce consumer mentality of buy now, receive tomorrow.
Alongside this, consolidation is often enhanced using suspension and retention packaging which uses its unique flexibility to pack many shapes and sizes. It’s reusable for return shipments minimising waste at both ends of the distribution cycle.
Innovation & Environment
Packaging engineers work tirelessly to produce the most cost-efficient packaging possible, exploring questions such as would a reduction in packaging thickness really effect protection of the product? Does an item have to be individually packed or can it be palletised? Would a thinner material increase operational capacity?
When efficiency savings are identified, their impact is analysed as it cascades throughout the supply chain, assessing the full circle impact. This re-assessment and rolling review structure is now the only option retailers have if they are to stay ahead of the curve.
Being able to quickly adapt modules of packaging operations to implement a new process to meet a new clients’ needs can have a drastic impact on overall business performance.
Packaging innovations are not solely being used to boost production capacities. Brand owners also want the packaging experience for the consumer to reflect their brand and promote retention. With ecommerce on the rise, more outlets mean more competition for consumers. Brands want to look good and provide efficiency; the right packaging can provide this – in ecommerce, packaging is the face of the brand.
Part of the consumer experience also has to be maximising protection. This results in reduced returns and cut costs, and pristine packaging can have a hugely positive impact on the whole brand experience.
A renewed cynicism amongst consumers has taken hold following the economic downturn, and brand owners are in a consistent battle to win the hearts and minds of consumers. Exceptional product is no longer enough. Consumers judge brands on corporate social responsibility too.
The environmental voices in the industry are shouting louder and manufacturers are responding with a greater range of environmentally-friendly packaging solutions. Having a cyclic view of the supply chain is crucial in being sustainable. It is of no benefit if an environmentally-friendly packaging is selected which is larger, needing more transit and increasing fuel consumption.
Whilst the current environment isn’t conducive to analysis of where the pressure points are in a supply chain, it’s crucial these are assessed now. Audits will often show that small total expenditure costs such as packaging can have a significant impact on efficiency, productivity and profitability.