Why Packaging is Important in Supply Chain Management

Packaging is important to any business with inventory. In both B2B and B2C, many will agree that it plays a big role in the supply chain. In this blog post, we will discuss how packaging can optimize your supply chain in areas such as logistics, warehousing and more.

Design 

Functionality coincides with good design. Two relevant design elements are:

  1. Identification: It is crucial that important information is displayed properly on your packaging. Things like RFID or barcodes should be easily identifiable. This makes it easier when doing inventory and cycle counts. As well, information about product handling should be clear. This includes hazard warnings, instructions and even nutrition facts. Proper labeling helps immensely with tracking and organization.
  2. Physical Design: For transportation and handling purposes, makes sure your packaging is properly designed to be easily carried around. Things like handles, stacking ability and the materials used are some basic examples of functionality. In addition to protecting your inventory, well designed packaging is also beneficial for employee and warehouse safety. Good packaging makes transportation easy and uses space efficiently.

Optimization

Packing optimization can help save you money. By incorporating elements of lean thinking, companies can think about reducing the amount of materials they use. Using less materials can help increase cash flow. As well, a reduction in use makes items lighter, resulting in easier transportation.

Nestle Waters is a good example of a company that implemented packaging optimization. From 2010 to 2015 they were able to reduce their plastic usage by %19. By doing so, they were also able to reduce weight, which decreased by 9%.

Sustainability

Now, more than ever before, businesses are choosing to take green initiatives. Sustainability is becoming more and more important and because of this, procurement is becoming a focus as well. Through packaging optimization, many are making the switch to using sustainable materials. Some goals of sustainability in packaging include prolonging the life cycle and reducing environmental impact.

Currently, we are seeing developments for edible and biodegradable packaging.

Conclusion

There are many reasons why good packaging is beneficial for your business. It’s all about functionality and optimization. The results can increase cash flow, create a safer environment and improve efficiency in your overall supply chain. Packaging is more essential than you may realize, so make sure you’re getting the most out of it.

Want to learn more about supply chain? Book a demo to see how Clear Spider can help you!