DC Velocity - December 2009

equipment&applications

think

about the

box

Packaging may not be the first

WHEN JACK AMPUJA GIVES A TALK ON PACKAGING, HE BRINGS along a visual aid: a shipping carton he received that’s big enough to hold its contents several times over. His point is one familiar to most logistics professionals: Businesses ship a lot of air, driving up costs in a number of ways.

Ampuja, who is president and CEO of the consultancy Supply Chain Optimizers, says more often than not, the problem is simply lack of awareness. Companies typically select packaging based on marketing or other considerations without giving much thought to the supply chain implications, he says. As a result, they end up using more packaging than they need, creating enormous waste and unnecessary expense. He advocates with some passion that logistics professionals take a stronger hand in decisions about the packages their companies use to ship freight.

Package selection has taken on added importance in recent years as carriers—particularly parcel carriers—have begun imposing dimensional weight rules. Under those rules, the size of a package that’s over three cubic feet can matter more than the weight when it comes to determining the freight charge, especially if the shipment is not very dense. Shippers have learned the hard way—through chargebacks by carriers—that they’d better be as aware of package dimensions as they are of package weight.

But the dimensional weight issue is just part of the reason Ampuja urges logistics professionals to take more control of packaging. Cost enters into it too, he says. Packaging has significant effects on logistics costs well beyond the price of cartons and filler. For instance, it can have a big impact on transportation expenses. The more packages you can fit on a pallet, the more packages you can get in a truck, thereby reducing the number of trucks needed and the amount of fuel used—important issues from both a cost and a sustainability perspective.