How to Reduce Packaging Costs and Save Time

Product packaging can be seen as an essential factor in presenting your products professionally while adding value to the customer’s experience with your brand. Your product’s packaging will have a huge influence on a customer’s purchasing decision, so it should never go unnoticed. Of course, there are many ways to optimize your packaging experience while saving 40% of resources. We can group these resource savings into two categories: the packaging costs and the time it takes to produce the custom boxes.

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Saving Packaging Costs

The cost of packaging depends on a number of factors like structural engineering, the materials being used, the number of units to produce, and more. Based on your project details, the packaging costs can change drastically, making it hard to give a definite price at first glance. However, our detailed guide will go over everything you will need to know to efficiently save on costs.

Structural Engineering and Material Optimization

The structural design of the packaging box and its packaging material both play a role in determining a packaging’s value. The vital part of the packaging is that it serves its purpose to protect the contents within. This means that it all depends on your product specifications.

Based on your product details, there are many ways to optimize without sacrificing the quality you want. Some of these aspects include finding different box and insert materials, creating dielines that reduce weight or material usage, and more. All these reductions help to find an affordable box that prioritizes your product needs.

Here is an example of how to reduce packaging costs and the components involved with this process. Let’s use a water bottle as the product example.

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While both boxes serve their function, Box A will cost more in the long run than Box B. Box B strips down a lot of excess elements to reduce costs while using great quality and structure.

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As seen above, Box B is smaller because the dieline is optimized to fit the product better, reduce material costs, and increase production efficiency. This also means that the overall weight of the product and the cargo space for shipping is reduced. Weight and cargo space can be costly when transporting a heavy box that takes a lot of space. By having a lightweight box with minimal space usage, you can save plenty of transportation costs.

Depending on your order quantity, you can save printing costs as well. Offset and digital printing are both great printing options but depending on your quantity, one can be more cost-effective than the other. For low run projects, digital printing is your best bet for cost-effective solutions. However, keep in mind that the color accuracy might not be as accurate as offset printing. Offset printing has better color matching and is perfect for higher order volumes, but gets expensive for small order quantities.

Taking the time to realize what you “need” from your box instead of what you “want” is essential. Having those extra details may cost you 15% or more than what you expect, so keep this in mind. Choosing foolproof structures and focusing on exceptional artwork design is a smart option if you’re not prepared to pay large amounts of money for complex custom packaging.

Furthermore, having a good idea of the price range for each packaging material will help to further your decisions. We’ll cover this in the next section: volume planning.

Volume Planning

Volume planning involves details such as the order quantity, your product launch plan (your timeline), and setup cost. The project details and the decisions made for your product packaging are vital to determining the price range. 

Have you ever noticed that small run projects have a higher unit price than large run projects? Why is that? Well, something to remember is that part of the pricing also includes the setup cost. The setup cost is the cost needed to prepare the machine to produce your boxes based on your project specifications. This involves cleaning the machine and tooling, changing different components of the machine needed for cutting, dyes, etc. Small runs will cost more per unit because manufacturers will need to set up the machine for your specifications every time you order a new batch. Meanwhile, large run projects can produce a large number of units at one time, only needing to set up the packaging machine once.

Take this chart as an example of how large run projects are more cost-effective than producing in small batches. Let’s say that your business needs 5000 packaging units within a year.

Small run vs. large run production process and costs
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By producing all 5000 boxes at once, you save 4 times the amount of setup costs. It’s all about preparing the most efficient way to get the amount you need before your deadline!

Manufacturing

Where you manufacture your packaging matters! Each manufacturing network comes with its own set of expertise, certifications, and processes so it’s important to compare and contrast to decide where you want your packaging produced.

Below is a visual of what to expect when comparing packaging manufacturers’ quotes and what they have to offer.

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In addition to their certifications and offerings, determining whether you’d like to work with domestic or international manufacturing companies is another thing to keep in mind. Deciding between domestic manufacturers and international will depend on the price, quality, and other specifications of your project (e.g. sustainable efforts, shipping method, etc). Here is an example of a cost breakdown between domestic and international manufacturers that may determine the quotation prices.

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Notice how some aspects of the breakdown will change the packaging costs (e.g. the method of shipping). Some of their price breakdowns, as seen above, may include:

Setup fees – preparing the machine based on your packaging box specifications (i.e. size, printing method, die-cutting, etc.)

Tooling – obtaining the correct components and machinery required to produce your project. This includes dyes, cutting equipment, molds, etc.

Quality control and error/waste prevention – ensuring that the machines are cleaned and set up accurately to prevent any printing errors, cutting errors, etc.

Shipping and delivery– Planning out the method of shipping and the optimal route to take for your packaging to arrive on time with minimal interruption and damages.

As you can see in the graph, some of these processes can be based on project outline, time, and distance, so it’s your job to choose which factors are worth optimizing.

Logistics

Similar to how transportation has different routes to get from point A to point B, logistics assist in planning the most efficient packaging methods and routes that are inexpensive and punctual. One of these factors is transportation. Depending on where your business is located, your manufacturer’s location, and your timeline, some options will be more efficient and cost-effective than others. 

Your timeline and due dates will be a big influence on deciding what mode of transportation to use. If your time constraints are strict, air shipment or ground transportation may be the best bet (of course, this also depends on the distance between your business and manufacturer). If your timeline is loose and flexible, sea shipment will be the most cost-effective solution.

There are pros and cons to different routes and delivery methods that can affect your packaging costs and time.

Different shipping methods: ground, air, and sea shipping
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Saving Time on your Packaging

Now that you have an idea of how to reduce packaging costs in different areas of planning and manufacturing, let’s jump into ways to save your time. As a business, managing your time and prioritizing your tasks aids in creating an efficient working system. The packaging industry works in a similar way. Time-saving focuses on planning, sourcing, and managing every stage of the project cycle to ensure there are no loose ends.

Planning

Structural designer planning a dieline

Something to note is that not all companies offer the same services. For example, typical manufacturers and online packaging stores only provide production service. They usually don’t involve structural engineering, artwork, etc. This means that you’re on your own to source the other services they lack. 

Meanwhile, solution providers offer production services and partial or full project cycle management, meaning that they may have the ability to plan your box, help to source packaging machine manufacturers, and manage logistics. Of course, they have limitations such as quotation management and price optimization. The best way to save time is to find a company that can potentially cover all the services you require.

Your business should have some knowledge of how your product launch plan will look like: what is your timeline? What is this project for? How many units do you need? If you don’t have an idea, it’s best to find a packaging specialist to help you determine these aspects in your project and guide you through other processes such as requesting a quote, sourcing, logistics management, etc.

Sourcing

Sourcing is all about price and quality comparisons. While it may take some time to compare and contrast vendors and designers, it’ll actually save you time. How? Well if you think about it, selecting a vendor that has the quality materials you need, monitors quality control, and creates efficient production processes will reduce the potential of errors and concerns. This is similar to manufacturing in the cost-saving section mentioned earlier. Picking those with expertise in their craft is always a good way to save time.

Design

Similar to sourcing, finding skillful structural engineers and artwork designers can save you time. While you may think that it will be costly to work with an experienced designer, give it some more thought. If you were to work with a designer who is unfamiliar with certain aspects of packaging design, you may end up spending more time and money to have them revise or redo something that an expert packaging designer would have already done the first time.

Average Designer vs. Expert Designer
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You don’t need to go through many trials and errors working with people that are experts at what they do.

Logistics

Remember how logistics was a factor in saving costs? The route and transportation method you choose saves the time it takes for your project to go from point A to point B. Logistics services can make it so that they are able to track your packaging and receive any updates regarding its location as well as if there are any problems, reroutes, or delays that may occur. If you are using a combination of shipping methods, you will be able to estimate the arrival time and transfers from one site to another.

Logistics and shipping methods
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Management

The management process ensures that all aspects of your packaging journey are thorough, minimizing the amount of hassle for your business. Management looks over the whole project cycle, from start to end: making sure that you receive your quotation promptly, that the quality and structure you expect is executed to the best of its ability, that the best manufacturers are chosen based on your project details, etc. This stage also makes sure that the logistics, delivery, and arrival or storage of your packaging comes smoothly, updating regularly for any new status. This saves you the time of having to manage everything yourself. Finding a solution provider that keeps track of the whole process lets you focus on other tasks.

How PakFactory Can Help

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We understand that this is a lot of information to absorb. The percentage of how much time and money you save will always vary depending on your decisions. Fortunately, PakFactory understands that not everyone will have expert knowledge about the packaging processes and how to optimize it. This is why we do everything we can to make it easier for your business. Unlike typical packaging manufacturers and solution providers, our packaging specialists provide countless services for your entire project cycle, all in one place. 

Our services include price optimization, request for quotation, packaging consultation, structural and artwork design, sourcing vendors, manufacturers, and fulfillment warehouses, logistics optimization, reducing packaging costs, and more! Basically, everything we outlined in this article, we can deliver! We can find cost-effective solutions for any part of your packaging journey.

Have a packaging project in mind or questions about packaging costs? Feel free to contact our product specialists to assist you!

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