UPS and Sealed Air announced this week the opening of their Packaging Innovation Center in Louisville, KY. on the UPS Supply Chain Solutions campus.
The Packaging Innovation Center is the next step in a partnership announced in November 2016. The goal is to prepare businesses for the future of supply chains, fulfillment, and packaging.
The eCommerce revolution is shifting UPS operations from B2B to B2C. UPS and its customers face new challenges unique to B2C shipments.
In B2B, most packages are larger and similar sized. Delivery hours are usually Monday through Friday, 9 am to 5 pm. Most notable, delivery stops are more efficient with more package deliveries per stop.
In B2C eCommerce, the delivery routes shift from commercial addresses to residential addresses. This changes pre-sorting, truck loading, route management, and stop frequency.
UPS recently announced they are upgrading their ground operations to include Saturday delivery. Therefore, the company reduces transit times, an important factor for eCommerce customers.
Product protection and shipping costs are pain areas for many eCommerce retailers. The consumer experience suffers when products arrive damaged or the box looks beat up.
PACKAGING INNOVATION CRITICAL TO CONSUMER EXPERIENCE
The first interaction a consumer has with a product is the package. Shipment packaging for eCommerce is the same “traditional” method as for B2B shipments.
A larger box surrounds a smaller package, filled with void or cushioning material. The smaller product package includes even more fill materials.
By the time a consumer opens a box and removes the actual product, they end up with a pile of packaging trash.
Now the customer must break down boxes and throw away fill materials. If offered by their municipality, try to determine what materials may be recyclable.
Of course, online retailers face a different dilemma.
They want to make sure the product arrives timely and in good condition. Customer satisfaction declines when the online retailer faces damage claims or delivery delays.
However, online retailers also care about cost. As a result, more packaging supplies increase weight and volume of a shipment. As a result, shipping costs increase.
With “Free Shipping” a practical standard marketing strategy for most eCommerce retailers, shipping costs impact the bottom line.
COST AND CLAIMS REDUCTION BY PACKAGE INNOVATION
The Packaging Innovation Center partnership between UPS and Sealed Air is tasked to innovate eCommerce shipments.
The main elements this partnership will tackle are:
- Minimize packaging waste
- Enhance product protection
- Reduce volume and weight of fill materials
- Promote brand affinity
- Increase efficiency in shipping operations
Improving these key elements will lead to lower shipping and warehouse costs. Most of all, new packaging and shipping innovation brings higher consumer satisfaction.
The unique partnership of shipper and packaging supplier benefits all eCommerce retailers.