The case for innovation
Think of a typical consumer trip to the conventional grocery store. Everything in the shopping cart is free from damage because those who delivered the products to the store have years of experience in knowing the dynamics between related production, packaging, shipping, storage, merchandising and handling. Each product’s supply chain has been highly developed to get it to the point of purchase.
Melissa Rishkofski, director of business development, Plastic Packaging Technologies, explained that grocery and big-box display packaging benefits from optimized uniformity of the products themselves. They are custom-specified for size, weight and product protection relative to typical distribution handling. “The same packing configurations can be sent to the online fulfillment center, but once they pull a retail unit from the wholesale display unit, the questions about co-mingling with other products in the final shipping container once again emerge,” she said. “In many cases, I would think packaging may have to be strengthened for the more uncertain journey ahead for the online route.”
Innovation in online-specific packaging is already occurring, according to Martin Prakken, CEO and owner, BluePrint Automation (BPA). He has seen machines that custom cut roll-fed corrugated cardboard to fit exact dimensions of products that ship directly to the consumer. Different types of packages and products can be grouped in a custom-sized box for that particular shipment.
Currently, food producers conduct shipping tests through third-party companies, Mr. Kehrli said. The tests, which replicate common distribution environments, examine how packaging protects a product through various types of agitation. Testing for online retail is more of a challenge because there is an X-factor in that food producers don’t know what might be case packed with their product. “Obviously, you can’t do a shipping test for every combination that a human being can order,” Mr. Kehrli said.
Understanding online retailers’ distribution process is critical. Bakers can use this information to work with their corrugated suppliers to make any necessary changes to their package templates. “When changes are required, you’ll need to assess your current packaging equipment lines to determine whether your machines can run the new package designs or if you need to seek an upgrade or new packaging equipment solution,” said Rick Gessler, vice-president, marketing and engineering, Delkor Systems.
He also suggested testing a product’s corrugated board strength. Depending on the weight and design of the products, varying materials and densities will better fit certain applications.
A cross examination
When selling products online, there is no need for a visual display box that attracts attention. The box no longer needs to stand out; it just needs to ship well and open easily.
“A considerable percentage of shipping is already done in a simple box,” Mr. Prakken said. “Shipping to online retailers like Amazon would be like going back to the old simple, basic shipping container.”
Highly flexible packaging lines should be able to accommodate this change. “Most of our BPA equipment can do the basics but have options added on so they can do retail-ready packaging as well,” he added. “We’ve always played in the field of high flexibility. Customers who buy our equipment don’t just run one product 24 hours a day, seven days a week without any changeover. Our equipment has a huge range for different formats on the same line with fast changeovers.”
Amazon and other online retailers may drive down costs for retail-ready packaging. Today, granola bars might come in 6-, 8-, 24- or 60-count retail-ready cartons for club stores with a carton that costs 12 to 15¢. Mr. Kehrli thinks that Amazon could eliminate expensive carton designs in favor of a multipack that is wrapped or overlapped, which would cost a fraction of a penny. Baked and snack foods are already sold like this in many parts of the world.
Cavanna builds multipack systems that produce secondary packaging commonly found in traditional retail channels in South America, Central America and Europe. The secondary package doesn’t have cartons or complicated displays. Instead it is simply put on a shelf with other multipacks. “They sell in multipacks, and the presentation of the product on the retail shelf is not as attractive,” Mr. Kehrli said. “However, the cost is much lower.”
Carton or no carton, production speeds remain the same. Cavanna cartons biscuits, cookies and crackers out of a primary wrapper at speeds up to 600 packages per minute. For a carton-less multipack, the same speeds apply.
“If Amazon takes the next step and drives cost out of the package, the consumer might get accustomed to this lower cost package that’s not in a carton,” Mr. Kehrli said. “I’d be willing to bet that the retail stores will follow. If the package change gets accepted, that will drive costs down straight across the board.”
There is also an argument that display-ready packaging may serve its own function in online retail as well. “There are advantages to using retail-ready packaging in both online and retail,” Mr. Gessler said. “Retail-ready packaging must be easy to identify, easy to open, easy to shelve, easy to shop and easy to dispose. These qualities are not only advantageous on retail shelves, but they are also beneficial in warehouses and especially in online retailers that rely on human pickers.”
Retail-ready designs, such as Delkor’s Cabrio Case, can make a significant impact in stocking efficiency in any setting, Mr. Gessler said. Having a packaging line that can do simple multipacks and display-ready packaging is key to success in all channels. It would be more complex and costly to develop and maintain a variety of product and packaging solutions for all the various distribution channels, he argued.