E-commerce is an industry hot topic. U.S. e-commerce sales reached $396 billion in 2016 – and are predicted to grow to $684 billion by 2020. The growing prevalence of online shopping means big changes for retailers and product packaging, specifically as it relates to a different supply chain and consumer expectations.
As you work with your customers and their e-commerce packaging needs, here are some considerations to keep in mind.
E-commerce supply chains differ from traditional supply chains in many ways. In this article, I’m considering the processes that support distribution in supply chain sequences. For example, the number of touch points between manufacturer and customer are generally much higher than the traditional manufacturer, to retailer, to customer/consumer network. The quantity of product shipped is significantly fewer – as few as a single unit. And multiple distribution centers can be in play.
Most significant to our packaging role in the e-commerce supply chain is the addition of direct-to-consumer shipments. This different approach calls for re-evaluation of your packaging design and a new strategy for the future.
Packaging Digest hosted a July webinar on e-commerce packaging and presenter Laura Flanigan of More from Less USA offered four steps to efficiently evaluate your e-commerce packaging strategy. Speaking to consumer product manufacturers (your customers), she suggests:
· Take stock of your current reality in terms of how product moves through your supply chain inbound, outbound, in the warehouse and for returns.
· Make sure you know how to measure your performance, and understand where your business is growing in terms of e-commerce.
· Then, develop a plan with time-bound milestones, category by category, for what you’ll try to achieve this year and in the future.
· Next, plan with measurable clarity—and execute, execute, execute. The goal here is to minimize ad hoc or reactive design changes—being proactive will save you money, even if you decide to wait to address certain issues.
Testing protocols can be a great way to perfect the design of e-commerce packaging. The International Safe Transit Association (ISTA) has worked with the packaging industry and Amazon.com to develop a set of protocols to properly evaluate packaging for successful transit through this complex supply chain. ISTA 6 Amazon.com (SIOC – Ships in Own Container) and ISTA 6 Amazon.com – Overboxing protocols consider the two most common shipping situations.
Consumer expectations also play a big role in e-commerce packaging. Consumers care about delivery, package or product damage and waste impact, among other things. This is an important factor in helping your customers with their e-commerce packaging needs.
The new pricing standard for shipping by UPS, FedEx and the USPS regarding dimensional weight is helping to “right-size” packages and eliminate unnecessary waste. This means more effort on your end to ensure that the correct packaging and product go together. But, it’s a great boost for consumer confidence in corrugated industry sustainability.