Everyone in a shipping room uses shipping boxes to ship out their products. Whether you are just setting up a new company and are looking for the lowest cost packaging or you are an established manufacturer this article was written to help you reduce your packaging costs, specifically how to reduce your corrugated box costs.
1. Check your box sizes to make sure they fit the product they are protecting and shipping. A good general rule for protection is 2″ around all products. If you are using a box that requires a lot of stuffing (more than 2″ all around) you might find a smaller stock shipping box. Since most packaging supply companies have over 100 stock box sizes chances are you can find the appropriate size.
2. Choosing the correct box design and style. A good rule of thumb in corrugated boxes is “Deeper is Cheaper”. If you can configure your box so that it opens on the smallest dimensions and the largest dimension is the deepest, this allows for the least amount corrugated to be used to produce the box. And thus “Deeper is Cheaper”. There are many box style available. The Standard RSC style shipping container is the most common, but if you have a long narrow product a Five Panel Folder or FOL might work better and may be manufactured using less corrugated. Check with your corrugated supplier as to the alternatives.
3. Make sure you are using a box that is rated (not overkill) to transport the amount of weight that you are packaging. There are many grades of corrugated. Corrugated grades ranging from “non-test” grade to over 1300# Triple wall are all common. Consult your packaging professional for the proper board strength for your product.
4. Industry Knowledge can be invaluable; knowing when prices of paper and paperboard go up and down can allow you to better negotiate with your corrugated supplier. Use sources like Pulp and Paper magazine, available online to gather industry news and paper pricing. When the paper price has gone down, ask for better pricing will save you big money on shipping cartons. If paper goes up your corrugated supplier should notify you and give you the ability to pre-buy before the effective price increase date.
5. Change or Shop corrugated suppliers to create some competition. The internet is great for shopping for retail products, but not so for industrial products. You still need to find good local companies and have them quote your corrugated needs. You want to be the customer that the box salesperson knows will shop pricing at the mere mention of a price increase. Business relationships do exist, but friendly competitiveness goes a long way to keep your packaging costs down. Plus introducing a second vendor allows for a back-up supplier and a fresh set of eyes on your process. Many times savings can come in the way of a changed packaging method or box size.
6. Change your box to reduce your Shipping Costs. I know this does not exactly come under the “saving money on your shipping boxes”, but if you can reduce the weight of your box by changing how you package that can reduce your single shipment costs. Also changing the box size to allow for more of your product on a pallet can increase the total product shipped and in full truckloads or even LTL this can reduce your freight per product.
7. Buying larger quantities of custom corrugated boxes per order can reduce your box cost. Most corrugated box manufacturers sell converted boxes by the square foot of corrugated per run. Square foot price breaks can be as significant as a 20% reduction moving from one square foot board break to the next. Always have your supplier quote you board breaks. If you are looking to order between 1000 and 2000 boxes, ask for the board breaks in-between those quantities. Many times you will find a quantity of 1200 will give you a 10-15% reduced cost over a price for 1000 boxes.
8. Just in Time inventory and blanket purchase orders for a period of usage. Many packaging distributors will stock your custom boxes for you on a “blanket Purchase Order agreement” and release the boxes as you need them. This will allow you to purchase a larger quantity (usually at a lower cost) and receive boxes as needed. This should lock you in at a lower price and let you keep your cash flow and inventory the same, as you should only pay for the boxes as you receive them.
Using the above techniques with a good corrugated consultant can result in major packaging cost reductions. This was specifically written for anyone who is looking to reduce packaging costs. I hope this article has provided ideas to reduce your packaging and shipping box costs.