Packaging is crucial for eCommerce retailers and is often the first tangible interaction a customer has when ordering online. Smart packaging strategies impact brand perception, product protection and critically, fulfilment and shipping efficiency.
This post looks at the key considerations when building a packaging strategy and how automation of the packaging can play a role in this warehouse operation.
Packaging Types
There are two types of packaging used in eFulfilment:
- Box – corrugated cardboard carton – ‘hard shell’
- Bag – loose sleeve made out of plastic or paper and seals closed – ‘soft shell’
Key Packaging Considerations
The rapid growth of ordering products online has increased the importance of packaging. Retailers must consider a range of factors when defining their packaging strategy. This often involves compromise across a range of departments including marketing, finance, operations and compliance.
- Primary purpose of packaging is to prevent damage or theft of items.
- It should facilitate the handling and processing of delivery partners or couriers.
- Well-designed packaging can boost packing speeds to support operations.
- Packaging can be branded to enhance customer unboxing
- Although, as a consumable, packaging must also match brand’s ESG
Packing Approaches
There are three key approaches to packing processes in a warehouse, which relate to when the packaging is produced or decided:
Box First
‘Box First’ entails the creation of a box or container before the order is released so that items can be picked directly into packaging. This is typically used for packing into boxes. The main benefit is that it minimises handling, however it requires either consistent shipment sizes to limit the number of packing container options and/or strong master data management for the system to effectively predict parcel sizes before picking commences.
Box Last
‘Box Last’ refers to a two-step process where an order is picked into a container or trolley before being taken to a pack bench for packing. The warehouse operative determines the right packaging only when they have seen its contents and can choose between a box, bag or envelope as well as the size of the chosen packaging. This is often the simpler approach and allows the operation to deal with a wide variety of packing requirements.
Pick and Stick
‘Pick and Stick’ is less common but involves the shipping of products in their original packaging. This is more common for larger electronic items or furniture. This saves further investment in packaging and processing. Warehouse operatives simply apply a shipping label to the box and load it to the courier.
Packing Automation
Packing is a growing focus in the warehouse automation industry as operators look to improve the speed of the packing process and optimise a very labour-intensive process.
Enablers of Packing Automation
Automated packing becomes more feasible for operations where:
- Volumes are high and any asset can be sweated.
- Labour costs are high, or it is hard to attract labour.
- Packaging requirements are simple (i.e. do not require customisation or wrapping).
- Master data management is good with item weights, dimensions and flags to route orders to the right packing method.
Business Case Considerations
To develop a business case for an automated packaging requires look at numerous impacts:
Capex
- Equipment price
- Installation and project costs
- Integration costs (if separate)
Opex
- Labour savings
- Packaging consumable costs impact
- Maintenance costs
- Systems costs
- Shipping benefits from right sized packaging
- Operational resilience
An attractive payback for packaging will be between 1-3 years but ultimately depends on each business’ appetite for investment. The risk of the technology being surpassed or out of date grows as the payback lengthens. Customer preferences and environmental considerations may change as consumer perceptions can change quickly – think about the impact of the Blue Planet documentary on plastic packaging in the last decade.
Buying Automated Solutions
Automated packing systems comprise several different components:
- Automated packing unit
- Conveyor
- Label printers
- Label applicators
- Scanners
- Sorter
The market is quite fragmented with different companies each offering part of the solution. Integrators can develop systems out of several components to offer a one-stop shop for an end-to-end packing solution.
Types of Packaging Automation
There are many different types of automated packing equipment, although they can be broken down into a couple of categories:
- Autobaggers
- ‘Vertical’ baggers
- ‘Horizontal’ or in-line baggers
- Auto boxers
- Carton erection and closing
- Standard closing
- 1D height reduction
- 3D carton formers
- Carton erection and closing
Each of the options comes with their own advantages and disadvantages with cost, throughput capacity, space requirements being key variables. Some are better at handling single item orders whilst others are more appropriate for multi-items orders.
Often, operations might require a combination of solutions however this would require sufficient volumes to justify a payback across different technologies.
The Future of Automated Packing
The panacea of any eCommerce warehouse operation would be for full automation. This could involve items being picked with a robotic arm from an ASRS (Automated Storage & Retrieval System) like a shuttle or robotic solution and placed directly into a pre-built carton or bag, right sized to the orders contents.
Robotics arms are developing rapidly but are currently unable to match humans for the speed, cost and flexibility of movements to be deployed in significant numbers. Whether the packaging part of the process will use existing technology to build and seal packaging or whether robot arms will be able to perform the end-to-end process will depend on much greater development of the technology.
Automated vs Manual Packing
Automated packing processes can deliver many benefits; however, it will not be appropriate for every warehouse operation. Whilst recent years has seen the development ASRS solutions that are suitable for lower throughputs, the automated packing sector has not yet reached this point.
Even in warehouse operations where automation justifies itself, there will always be orders that, for whatever reason will not work with the automation. The order might be too large, too small, or require gift wrapping or some other customisation. As a result, manual packing will always be required, even if for a small minority of volume.
eCommerce is notorious for surges in volume, particularly around Black Friday, Christmas or other promotional activity. Automating to hit peak volumes can be incredibly costly and ruin any business case. It is critical to pitch any automation investment at the right level, to cover the baseload volume plus a reasonable uplift. The excessive peaks might be addressed through manual processing, relaxing service or incentivising customer behaviour to smooth volumes over a longer period.
Manual packing, though, is relatively cheap, scalable and immensely flexible and is still common across many operations.
Summary
Packaging and the packing process is a critical part of warehouse operations. Being such a labour-intensive process makes it a prime candidate for automation but there are many factors to consider when making such a decision, like what is the right technology, how will it impact other areas of the business including ESG credentials and the customer unboxing experience, for example.
To get an independent view on how automated packing can be deployed in your operation, then get in touch with a BoxLogic consultant today.
