Overcoming E-commerce Challenges with Strategic Packaging Decisions

This article has also been published in the Food Logistics Magazine, Sept. 2018 issue. 

By: Mark Kitzis, President, North America, Aptar Food + Beverage

The method of transporting products to traditional retail stores has been perfected down to a science over the years. Identical products pack neatly into one corrugated box; boxes stack tidily atop one another to form a calculated cube that ships on a skid to the retailer. Seldom do products arrive damaged as they have been optimized to be shipped and sold in palletized units.

However, the game changes with the e-commerce supply chain. To reach the consumer’s doorstep, food and beverage products may go through three times as many touch points as the traditional retail supply chain, which has been proven to negatively impact today’s primary packaging.

When consumers receive a damaged product, not only can it reflect poorly on the brand, but many times, the brand is charged for reshipping, repackaging, and damages to any other product in the shipment.

To diminish the risks of damaged products during transport, brands and online retailers may implement tertiary packaging such as air pillows, bubble wraps, shrink-wraps, etc. While this does help to better protect the product, it can significantly affect profitability due to the total cost increase, while also creating an undesirable unboxing experience to consumers. In addition, the excess plastic is not environmentally friendly and makes the shipping process less effective with less items fitting in each box, considerably increasing carbon footprint.

As brands increasingly become aware of these challenges, they have the opportunity to further improve the performance of primary packaging, and in turn, improving the brand’s bottom line.

Packaging Considerations for the Online World

Statista shares that U.S. food and beverage e-commerce revenues are projected to grow to $25.9 million by 2022, which is more than double 2016’s revenue of $11.6 million. To keep up with the radical growth rate of e-commerce, it is important that food and beverage brands start to consider adopting primary packaging that is designed to withstand this rigorous supply chain.

Fortunately, brands do not need multiple packaging formats for the different retail channels as primary packaging can be engineered for e-commerce distribution and brick & mortar stores, simultaneously.

In the short term, brands will benefit from collaborating with suppliers who are knowledgeable about e-commerce testing protocols. One example is ISTA 6-Amazon.com-Over Boxing, which mimics how a package responds to shipping conditions, by simulating drop impact, vibrations, and temperature fluctuations.

Furthermore, brands can count on packaging suppliers who participate in the Amazon Packaging Support and Supplier Network (APASS). These suppliers provide exclusive services related to packaging design and tests that comply with Amazon’s guidelines in order to help vendors, sellers, and manufacturers receive certifications such as Frustration Free Packaging (FFP), Ships-in-Own-Container (SIOC) or Prep-Free Packaging (PFP).  Aptar is a leader in innovative packaging concepts and is committed to addressing the challenges of primary packaging imposed by the e-commerce supply chain. Aptar is also an Amazon APASS supplier.

As the majority of the food and beverages packages are not at a point where they can receive FFP or SIOC certifications, designing a new package that is PFP (Prep-Free) is not only possible, but also worth pursuing. Benefits of the certification include decreasing total cost per shipment, as PFP-certified products do not need excessive protection and additional labor, as well as highly increasing consumers’ satisfaction. In addition, PFP-certified packages also minimize the use of plastic, while allowing for a more efficient shipping process, with no returns due to poor performance.

The future is bright for brands pursuing primary packaging designed to sell and ship on the e-commerce channel. Embracing the new needs of e-commerce and collaborating with strategic suppliers who can help brands to rethink packaging, will not only give consumers the e-commerce experience they expect and deserve, but also help brands to improve their bottom line with a competitive advantage for many years to come.

Mark Kitzis is the president of Aptar Food + Beverage North America and has 22 years of packaging experience in both rigid and flexible packaging. Prior to his current role, Mark was General Manager, VP Global Accounts, and VP Research in the packaging industry. Please visit www.aptar.com and follow Aptar on LinkedIn and Twitter at @aptar.