value optimization

Cost Savings Beyond Sourcing: Corrugated Packaging

In order to optimize packaging-related cost savings, using a holistic approach to evaluate processes, waste, sourcing, and design throughout the entire packaging system is necessary. In most cases, when companies discuss their approach to cost savings related to packaging, it addresses only one element of packaging, such as reducing packaging material.

Optimizing packaging and supply chain costs involves partnering with design and supply chain experts, as well as material suppliers to identify and develop the best quality solution. It involves leveraging experts in logistics, sourcing, packaging design, process efficiency, distribution costs, etc. to identify what’s working well and what can be improved upon.

Adept Packaging’s Value Design Model

In Adept Group’s Value Design Model to Margin Improvement, we leverage our global supplier network to evaluate and identify the best supplier for the challenge at hand, resulting in the lowest total landed cost for our clients’ packaging designs. Through a thorough understanding of the client’s supply chain, needs and limitations, we identify the optimal solution.

After understanding our clients’ needs, our cost savings experts identify areas for margin improvement and then we select the supplier that can offer the highest quality solution.

Corrugated Savings

For example, for corrugated packaging, we’ve partnered with TRG, a supplier with unique machinery, a design ethos that matches ours, and insight into the entire corrugated supply chain. On projects we’ve worked on with TRG, we average:

  • 15-20% material reduction
  • 25-30% throughput increases
  • Up to 80% labor and set up reductions
  • Time and waste reduction to increase total supply chain effectiveness

Avenues to Corrugated Cost Reduction

Depending on the material, component, product and supply chain needs, cost savings can come in the form of:

  • Lightweighting
  • Optimizing use of material
  • Design optimization and automation
  • Design and supplier equipment utilization
  • Pallet optimization and quality improvement
  • Labor and setup reductions
  • Eliminating additional components
  • Update printing methods using the latest technology

Material Reduction through Design Innovation

Through the use of specialized converting equipment, we are able to create corrugated designs that reduce the number of components in the packaging. These unique conditions allow for design innovation for both online and offline execution without sacrificing packaging quality or performance.

Labor Reduction Throughput and Set-up Efficiencies

Combining innovative design concepts with uniquely capable supplier equipment, we are able to develop quick set up designs and revolutionary case automation possibilities. These designs reduce material waste, as well as allow for staffing reallocation due to reduced time needed to set up packaging, both in the warehouse and in-store.

Time and waste reduction to increase total supply chain
effectiveness

In addition to increasing efficiency through packaging design, material reduction allows for maximum pallet efficiency through more product per pallet. The reduction of packaging components leads to less inventory management and increase warehouse space.

By starting with the packaging concept, this process allows for efficiency improvements throughout the entire supply chain, as well as innovation that not only saves cost, but differentiates products in store.

Cost Savings Beyond Sourcing Learning Share

If you’re interested in learning more about cost savings beyond sourcing, check out our December 2019 Learning Share presented by Adept Value Optimization President, Jared Spencer, and TRG Director of Design & Value Engineering, Jeff Jolley. They discuss details and case studies of how our approach has helped some of the most iconic Food, Beverage and CPG companies achieve their cost savings goals.

packaging cost reduction

A Holistic Approach to Cost Savings for the Packaging Industry

Margin improvement for packaging requires a methodology that identifies and evaluates all the sources of cost within the packaging process to reduce waste, optimize for efficiency and add value. Adept Packaging’s Value Design Model Analyzes spend throughout your packaging program, from concept to commercialization. This methodology provides a holistic view of cost savings opportunities, while identifying and correcting inefficiencies.

Evaluate Your Package Design

When designing a new package or remediating an existing design, there are many factors to consider to reduce cost. With new and innovative concepts being engineered every day, rethinking the material, components, and design of your packaging can significantly reduce cost.

When you engage a consultancy like Adept Packaging, companies gain access to incredibly diverse teams of packaging subject matter experts with a multitude of materials, components, processes, and technologies. Experience enables our team to identify the attributes of your preferred packaging design and offer suggestions to improve, amend, and adapt for cost savings.

Know the Drivers Impacting Packaging

Another consideration when designing packaging is e-commerce market growth. Among other drivers in the packaging world, packaging for e-commerce demands attention. Considering the complexity introduced by the additional touchpoints throughout the distribution environment, packaging needs to be robust enough to protect the product and brand integrity. With experts in e-commerce and sustainability, our team can help to reduce the costs associated with damage and product loss.

Analyze Your Procurement Strategies

In addition to packaging design, analyzing your packaging procurement strategies is an important focus area for margin improvement. Often companies use the same supplier for years without evaluating other options. Taking the time to do an analysis of, not only your suppliers but your purchasing schedule will give your procurement team a more transparent view of possible avenues to cost savings.

Through our extensive experience and visibility into the packaging industry, Adept Packaging has developed a thorough benchmark of the capabilities, advantages, and drawbacks of packaging suppliers, original equipment manufacturers (OEM’s), contract packagers and other adjacent companies within the packaging industry. Being supplier and material agnostic, allows us to help you identify the best solution to fit your pricing, quantity and quality needs. 

This process helps in identifying & utilizing new packaging technologies, accelerating project schedules, expediting sample/prototype deliveries, lowering package pricing and enhancing overall technical packaging support to provide you the lowest total landed cost.

Examine Operations Optimization

Often, operations are an area that can be optimized significantly as well. Companies often overlook the maintenance of overall equipment effectiveness; only evaluating it when production volume dips significantly or they’re experiencing an uptick in failures.

Leveraging our operational equipment experts and best in class process efficiency tools, companies have been able to identify areas of improvement in OEE of up to 20%. From line and plant efficiencies to production and process effectiveness, our team will analyze your operations and make suggestions to improve overall productivity and reduce cost. 

Increase Efficiency in Your Supply Chain

Analyzing distribution costs and shipping efficiencies in your supply chain can be another area of margin improvement. From finding more efficient ways to package products for shipment, to examining shipping patterns, there are many different factors that can be reevaluated to reduce cost throughout the supply chain.

Our supply chain gurus have experience working with the most complex regulations, in the most demanding distribution environments in the packaging industry. With an aim to reduce risk, ensure compliance, and safeguard distribution qualification, our team will identify and mitigate any quality issues throughout your distribution environment. 

Value Design Model for Packaging Margin Improvement

Our subject matter experts deploy our Value Design Model to deliver margin improvement and to identify a comprehensive view of process inefficiencies, redundancies, supplier network gaps, material expenditures and areas for improvement within your packaging and logistics departments. 

Utilizing our vast network of SMEs, as well as our extensive supplier network, Adept Packaging provides our clients with immediate process improvements, design specifications, and testing recommendations, as well as other recommendations for margin improvement.

The Adept Packaging Value Design Model, featured in the graphic below, serves as a guide for driving value across your packaging supply chain.

Contact us to help you reduce cost, increase margins and add quality to your packaging supply chain today.