| By Scott Gowan | Director, Transportation Competency | Chainalytics
Good packaging design is one of the basic building blocks of sound, sustainable supply chains. Because it is, we’re always on the lookout for packaging improvement opportunities. We can’t help it! Problem solving is second nature.
A few weeks ago, this packaging improvement opportunity came into sight. As I shopped at our local hardware store for some new Christmas lights, I noticed some laser lights and multi colored spotlights and ended up purchasing LED lightshow smart lights. As I opened the box and pulled out the lights I noticed a cardboard platform at the bottom of the box. When I pulled out the platform there was nothing but empty space below.
Here’s the problem with this less-than-half-full box and its massive waste of space:
- These lights are distributed via multiple small and large big box and hardware stores across the United States and are likely shipped and delivered around November or December of the year–prime transportation time.
- The delivery time of year likely jacks up shipping and handling costs, even if the manufacturer is using its own private fleet.
- If you add excess warehousing handling costs into the mix, you can succeed in adding to the product’s cost by over 15 percent.
Ineffective packaging that wastes space isn’t just a seasonal problem. It’s one that is actually getting worse–especially in the fast-moving consumer goods (FMCG) and retail industries–due to the rapid escalation of same-day and next-day delivery and increasing ecommerce fulfillment demands.
As we’ve said before, smart packaging–packaging that’s designed to optimize and protect the contents of your package at the best price for the job–is the basis of effective supply chain planning. Bad packaging leaves money on the table. It’s a simple equation.
The director of Chainalytics’ Transportation competency, Scott Gowan specializes in providing clients with supply chain planning and optimization, transportation optimization, and logistics management and optimization services to enhance their bottom line.
Read more about how better transportation and packaging approaches make for better supply chains: