7 Surprising Packaging Cost-Cutting Measures That Actually Cost Your Business

Cost-Cutting Packaging Measures That Actually Cost Your Business

Businesses have one core function; to make profits and reduce costs while still providing value to their customers. If you own an online store or are an operations manager in a food processing company, chances are that you have package cost-cutting measures in place. This could be anything from buying in bulk or having a minimalist design for your products.

These measures are supposed to reduce your overall costs, but what if they actually cost your business? What if they are adding on to your overall expenses? Here's a list of "cost-saving" steps that many companies take that actually lose them business or cause more total expenses.

1.  Buying More Product than you need to Get a Lower Price 

Buying packaging products in bulk seems like a good way to save money; after all, the cost per unit will be lower, and you will never run out of material. What many companies don't realize is that by buying in bulk, you incur extra expenses. For instance, you will have to look for more storage space to store the packaging material, and in situations where you don't have enough space, you have to rent it.

Bulk buying also comes with the risk of the material being damaged due to improper storage or poor quality of the material. It would be wiser to only buy the packaging products you need for a short period of time.

2.  Lack of Packaging Design Testing

Packaging testing may seem expensive, but cutting corners can cost you a lot of money. Your packaging material must meet the shipping requirements; otherwise, you risk having returns due to damaged products.

By conducting packaging design testing, you have the opportunity to try out different design concepts to identify the one that suits your products best. If you're an ecommerce store owner, make sure the package is designed to protect the contents, limit contamination and stand up to the rigors of transit and handling.

It's important that you settle on packaging design based on actionable data.

You should also maximize the power of your designs through actual consumer feedback and increase your product sales.

3.  Using Outdated Packaging

Are you still using the packaging design you were using 5 years ago? Well, it might be time for a change. The design of your packaging has an impact on your target audience's purchasing decisions, and 4 out of 5 people have at one time bought a product just because they liked its packaging design. 56% of customers actively seek to buy from the most innovative companies e.g. those that improve their products based on new technology or consumer needs. Your packaging design could just be what gives you a competitive edge.

It may be cheaper to keep using outdated packaging, but it could be impacting your sales volume. Adopt fresh designs that show your company's innovativeness.

Customers, now more than ever, are becoming more environmentally aware so choose packaging material that is sustainable. Picking eco-friendly designs has nothing to do with complying with directives but can also be used as a marketing point.

4.  Not Branding the Packaging

You need to differentiate yourself from the competition. There are very many similar products in the market, and branded packaging is the only way your customers can associate products with your brand. Yes, you are cutting costs by packing your products with plain packaging material, but it will be at the expense of a unique opportunity to promote your brand.

Branded packaging is a great way to position your company in the minds of customers. If you use recyclable materials, your customers will reuse it, giving your brand more visibility. Stand out from the competition with a custom design!

5.  Using the Same Sized Packaging for All Products

Buying the same size packaging means you get to pay the same price for all products, but it is actually wasteful. It leaves a lot of headspace for smaller products, and you may have to put additional materials to support delicate products and prevent breakage.

77% of shoppers believe that companies packaging reflects the environmental values of the seller. A study showed that more than 90% of consumers are likely to buy from a company that supports environmental causes—the size of the packaging you use for your products is a clear indication of your environmental values.

Under packaging and over packaging also comes with implications on operations costs. Using excess packaging results in a high cost per product while under packaging raises the risk of product damage and contamination during transit. You will end up incurring more cost in packaging wastage and returns of damaged goods from customers.

6.  Using Incorrect Film Specifications

The specifications and size of the packaging film impacts the overall cost of product packaging. Thicker films are more expensive and take longer to correctly seal a product. When choosing the correct film specification consult a food packaging engineer who can determine the right millimeters. They will also consider the film with the best optical, physical and performance qualities that will result in improvements in savings, safety and production.

Incorrectly sized packaging material can also be a huge annoyance for your customers and leave a lot of room for smaller products to move around and may result in damages. Pack each product in its correct container to minimize risk or damage during transit and to reduce expenses.

Reduce Your Packaging Expenses; Rectify the Above Packaging Mistakes

To reduce the total cost of packaging and packaging ownership ensure you;

  • Reduce the gauge of a packaging film or the thickness of a corrugated box.
  • Resize the packaging to eliminate headspace and over packaging
  • Invest in product quality testing before settling on a packaging design
  • Go for quality over quantity.

Correcting the above mistakes will result in improved economics, better protection, increased shelf life for food products, and reduces the overall cost of packaging. Most importantly, it will improve your customer's experience with your products, resulting in brand loyalty.

SupplyOne is expert and uncovering hidden costs in your packaging and packaging-related activities to save you time, resources and cash-flow.  To put our expertise to work for you contact us today.