Reducing the Hidden Costs of Packaging

Representing International Paper, the world’s largest paper company and land owner, Mathew Wright shared a look at the costs of packaging and some tips on reducing costs for aftermarket companies.

While there are obvious packaging costs in the hard purchase price, Wright said, there are a number of hidden costs. It’s in the area of hidden costs such as labor, warehousing, down time, waste and distribution that savings can be realized with proper planning. He covered hidden costs in procurement, vendor management, storage and handling, inventory, cost of capitol, invoice processing and delivery.

When seeking a vendor for point-of-purchase packaging, Wright recommended finding a supplier that provides all the printing options in-house. He also pointed out that when looking at ways to reduce packaging costs, companies must consider the overhead costs of sales, design time, customer service time, A/R and accounting time.

Wright predicted that the future of packaging would be determined by a number of factors including: consolidation, understanding the total cost (resources vs. price), A/R (watching who we do business with), aligning with industries, and broader product offering through distribution.

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