Thinking Outside the Box
October 10, 2018
The importance of sustainable packaging continues to dominate headlines as more consumers strive towards achieving an environmentally friendly lifestyle. And while brands are reconsidering their consumer packaging, far too few have yet to address the extraordinary packaging inefficiencies that exist throughout the supply chain.
Given the risk of product damage associated with packaging that is too small, many suppliers are erring on the large side – but the cost and implications of this approach are considerable. With multiple sizes used, pallets are not optimised; while oversized packaging also impacts the number of items that can be stored in the warehouse or distribution centre (DC). Add in the costs of packaging, shipping and storing air, and reconsidering this area should be about far more than a consumer-facing concern. Retailers need to take control and plug the financial leaks across the supply chain associated with packaging inefficiency; that means enforcing very clear packaging standards across the supply chain.
Setting up standards
The starting point for businesses must be to create a robust review of requirements: what are the packaging specifications of the product? What are the space restrictions in the DC? And what can containers handle? The challenge, however, is not simply to create these standards but to ensure they are enforced globally; fail to do so and suppliers will rapidly revert back to using all various shapes and sizes.
Compliance is key – and that means ensuring a retailer has excellent visibility of the supplier’s packaging plans. The easiest approach is to automatically accept orders packed using the authorised sizes and materials. And if a supplier cannot access approved packaging for some justifiable reason, retailers can also offer a short list of acceptable sizes – while also ensuring the substitution is automatically communicated. The big win is to have immediate visibility when a supplier proposes the use of unauthorised packaging – enabling a retailer to accept or reject an order based on the potential financial (and ethical) implications of failing to follow the defined standards.
This visibility will also be beneficial to suppliers, inspiring them to stick to the rules. By providing excellent visibility of the retailer’s requirements, a supplier is able to quickly locate the right type of packaging and keep the process running as efficiently as possible.
This is a massive mindset shift. But in a world where packaging is fast becoming a key component of sustainable and ethical business, a supplier’s commitment to the use of standardised packaging must become a fundamental component of the decision making process.
Request Adjuno Software Demo
Customer Success Stories
We have found them to be an excellent business partner. Through the implementation of both their supply chain and sourcing software they have more than proven themselves in giving us a product that functions the way we need it to. LIMA has been a fantastic supply chain visibility tool, calculating real accurate landed cost position throughout the order lifecycle. The LIBERTY software matches our product sourcing business needs perfectly. PLM systems I’ve previously used, often bring lots of issues through implementation, but these guys managed this and I’ve got highly satisfied users.John Amm - GM Global Sourcing, Myer
The solution has realised more benefits than we initially thought possible. Claims notifications are being handled in a fraction of the time. Suppliers are making fewer calls into the office and quality scores have increased dramatically. All of this can only have had a positive impact on the customer experienceMartin Ashfield, head of commercial property claims, AXA
The system alerts us to exceptions against our plan, allowing us to focus our attentions on solving the real issues in the supply chain. Having a comprehensive audit trail of events for everyone to see has resulted in significantly improved service levels from our suppliers and agents.Darren Walker, head of generics buying and UK trading, Alliance Healthcare
Now our buyers can exchange photographs with suppliers and have a real-time dialogue as they develop styles, while buyers out in the Far East can send detailed and accurate information back to their teams in the UK. It has certainly cut lead times and reduced errors.Maxine Walter, supply chain co-ordination manager, New Look
The time it takes to compile reports has been significantly reduced; a report which used to take five whole days to complete is now accomplished within a single day!Sam Brown, Responsible Sourcing Co-ordinator - John Lewis.