shoppers and shippers
do it every year: When
sending gifts to friends
or family, they use a box
that’s a few — or perhaps
more than a few — cubic
inches too big. Just throw in a few more packing
peanuts and slap on the tape, right?
Because logistics professionals are human, the same
dynamic occurs when companies ship packages. It
happens more often than one would think, according
to a white paper by Pitt Ohio, a Pittsburgh-based
transportation and logistics services provider.
The cost of those oversized boxes and inefficient
packaging is higher freight rates.
Improving Packaging: The Cost of Shipping Air is
Going Up details how dimensional weight pricing,
which began in earnest in 2015, affects shipping
costs. Beforehand, weight and destination primarily
determined the cost of sending a package. Now,
every unused inch of height, width and depth adds to
Projected worth of the logistics sector in India by 2025 after formalization, according to a report in The Economic Times
( www.economictimes.indiatimes.com). Unorganized companies account for 80 percent of the country’s current logistics
sector, and the transition to formalization is expected to create opportunities for investment in supply management.
There are other costs, too. Excess
cardboard goes to waste, extra space
on a truck or plane takes up capacity,
and larger-than-necessary packages
require more fuel to transport. The
current driver shortage in the trucking
industry exacerbates the problem.
“However, shippers can immediately
minimize the impact of (dimensional
weight) pricing by downsizing their
packages, conducting better employee
training to select the right box for the
right product, cutting down boxes
to lessen void space, using durable
polybags for lightweight goods such
as socks and shirts, not overflowing
boxes and checking for void space in all
boxes,” the white paper states.
Jack Ampuja, president of Supply Chain
Optimizers, a Getzville, New York-based packaging optimization advisory
firm, identified five best practices in the
paper. They are:
1) Executives must buy in or risk a
failing optimization project.
2) Focus the strategy on cost reduction
3) Encourage shippers to be open to
4) Be flexible. The more flexible
you are, the more packaging-optimization success you’ll have.
5) Have reliable data to measure and
evaluate the project’s effectiveness.