8 alternatives to plastic packaging

All products need to be packed in a safe secure packaging that not only provides the protection to the product but also adds to the aesthetic presentation of the product. Today plastic packaging is one of the most common and popular form of packing material. It is cheap, strong, and durable and can be moulded into any shape required. However plastic has one major disadvantage. It is not bio degradable. Once discarded, it goes into the landfills where it sits for thousands of years. With consumer becoming environmentally conscious there is a need to move away from plastic packaging and use more eco friendly alternatives. Most of these alternatives have been around for years. They just need a fresh perspective to add some aesthetic appeal. Here are some alternatives which are not only better than plastic, they also add to the aesthetic appeal of the product.

  1. Paper is degradable. Not only that, paper is also reusable many times: Brown paper bags were quite common until some years ago. They are now making a comeback. Paper is used to make paperboard that is in turn used to make strong boxes which are used commonly to pack small light items. Paperboard has come of age and can be used for making food grade packing as well. Paperboard based sandwich packs are quite common. Paperboard cups are also commonly used for serving beverages. These can be shredded and reused again for different (non food grade) products or can be put down for bio degradation. It is made of wooden pulp that is natural.
  2. Cardboard is a thick form of layered paper is also very common in packaging industry: Cardboard needs no introduction. It is very popular packing material in form of boxes and cartons. It comes in all sizes, for small hand held products such as mobiles and toys to large boxes well above 1 meter on each side. Corrugated cardboard boxes have good strength to handle heavy products. They can be carried unfolded, requiring minimal space and can be easily disposed off. In fact strong large cartons are now being reused at homes to make coffee tables and as storage space among other things. And they disintegrate quickly, just like paper.
  3. Corn Starch: Corn starch is used as a Styrofoam replacement in packaging. It has the strength similar to plastic. It is shaped in form of beans and peanuts for providing cushion in packing large products and in making packing trays for food items. If disposed properly it decomposes into water and carbon dioxide within months, which is much shorter than the decomposition time required for plastic. It is made from corn, which is cheap and readily available.
  4. Zip lock bags: Though these are made of plastic, they are designed to be reused. They are airtight plastic bags that can store any product, which they can accommodate. Many households reuse them for storing food products. They may not be easily decomposable, but they are definitely reusable which increases their usable life and reduces the stress on resources used to produce them.
  5. Glass by itself is made from plain silica: It is an excellent material to store food items as it is water tight, air tight and inert. It also lends a classy look to the product and well designed glass jars are quite presentable. The jars and bottles that have wind up caps instead of crowns can be reused as household storage for Jams, sources, marmalades and many other items. If nothing else, a well designed jar is used as decorative item by itself. It is not only degradable (it is just sand after all), it is highly reusable. In fact soda companies reuse most of their bottles. There’s no reason why a business cannot have a well designed glass container that lends an aesthetic look to their product and remain eco friendly.
  6. Jute has become a coming of age material when it comes to its use as packing material: It was used to make large gunny bags to carry produce and grain (such as potato, rice, wheat etc) in large quantities. But today it is being used as a chic packing material that comes in various shapes, sizes and colours. It gives a rustic, classy old world feel to the product while retaining the earthy look. It is used to pack speciality items such as Tea leaves, dry fruits, speciality wines and gift items. It certainly does lend a certain class to the product. Jute is strong and can carry good amount of weight in small size packing, making it ideal for shipping.
  7. Wood is totally eco friendly: It has been used as packing material for large items for very long time. Even though the plastic pallets all are rage in the industry, wooden pallets are still very commonly used in freight industry. Wooden crates have been used for long. With recent advances in cutting and carving tools, small wooden boxes have become popular to pack speciality items. These are now used to increase the perceived status of the product and are by themselves reusable. This makes them a very effective choice as a packaging material if you want to increase the status of your product.
  8. Various forms of metal have been used for packaging sensitive material: With recent advances, the metal, in form of aluminium cans, foils, steel cans and jars, it has again become popular. It can be reused by consumers in the home for storage, and can also be easily recycled. It has been used for packaging food products like Oils, tea and other aromatic substances that need to be kept away from light and air. The thin aluminium foils are used to pack candies and chocolates. A non reusable but recyclable form of packaging made of metal, is the very popular can of soft drink. These are crushed, melted and reused to make cans again. Metal packaging is very versatile. It has been around for a long time. With new innovation it has become cost effective and attractive.

 

Packaging can be fun. It can be reusable, recyclable and economic. Producers just need a little imagination to use eco friendly products and make their product elegant and attractive.

Retail

Top Retail Merchandising Trends in 2017

The world around us is changing very fast. Owe it to technology or overall economic development, the way people go about their lives is changing. The trend of what people spend, on what do they spend it, how do they spend it is all changing. This is changing the world of retail business. While there have been studies by many economist all over the world, many of these changes are obvious, sensible and required to meet the needs of today’s usrban, fast paced life. Here are a few top trends that we think will grow this year.

1.Smaller stores instead of larger stores: People are moving closer to the city centres and downtowns. From suburban houses, they are moving into apartments. Many are also now avoiding purchasing or owning a car. That means the patronage to large format stores situated on the outskirts of the city will reduce. City centres don’t offer space for large stores. So smaller stores will increase in number. Many of the large retailers such as Target, Ikea, Best buy in US and Tesco in UK are already investing in small format stores. At the same time, customers don’t want to spend a lot of time walking around the aisles of a store. They now have an option to order things online and have them delivered to their doorstep, in the matter of hours. This means brick and mortar retail stores need to carry more curated products for their niche clientele in their catchment area to stay competitive. These two trends combined together will result in smaller stores located closer to the main residential areas, carrying a smaller but relevant selection of products.

 

2.Unique in-store experience: Customer has now many options to buy his product from. Not only offline, there are now many online stores selling same or similar products. However there is one thing that online retailers cannot provide the customers. The physical feel of the product and the in store experience. It is well known that for many customers, buying a product is a physical experience that involves many senses. With new technology, more options are becoming available to please these senses. For example, a home ware retailer in US, provides its customers with a handheld tablet. Customers can scan the barcode of the product they want and get more information about it online, on the tablet. If they like to purchase it, they simply add it to the digital basket. All the products are collected, packed and handed over to the customer at the checkout counter. Customers don’t need to haul the baskets or trolleys anymore. Now that’s a unique customer experience. As the unique in store experience becomes more important, we will see more such initiatives coming through.

 

3.Mobile payment solutions: Cash is getting irrelevant. Cards are a passé. There was a time when almost every store offered a loyalty card and customers carried bunch of them on their key chains. That was when it was simpler to just provide a customer with a card to identify him as a loyal customer. Today, technology has developed far beyond. All you need is just a mobile number to identify the customer. With digital wallets technology proliferating, credit cards are also becoming a hassle to transact with. This may be a good news for the retailers too, as they don’t need to maintain expensive credit card machines. A simple mobile based transfer of money with wallets or other mobile technology is easier to maintain for the retailer. With NFC technology maturing, it will be just a matter of touching the mobile in front of scanner and the payment will be done. This may seem like a small incremental step, but has huge potential and impact on the time customer stays at the checkout point.

 

4.Personalization will deepen: With so much competition, it is important to know your customer. In online world, the moment an old customer returns, he is identified and products, promotions and offers are shown based on his past purchases and search history. That’s almost a standard feature now. However when it comes to offline, this is still difficult to achieve. But, remember the mom and pop neighbourhood stores of old days? They remembered everyone by name. The moment a customer walked in, they told them where their special preferred product was kept, or a new product similar to the one they were looking for is here and they should try it. That’s the kind of personalization technology needs to provide. We believe it will happen sooner than later. The level of personalization in both offline and online retail business will improve.

 

5.Data will continue to be the king: More and more retailers will adopt data based decision making across their supply chain, right till the post purchase stage of the buyer’s journey. With tools for data collection and analysis becoming easily accessible, there will hardly be any retailer who will not employ data analysis to improve their efficiency and customer satisfaction. This will proliferate only in online world, but also in brick and mortar world in a very different format. A very well known clothing merchant in USA, factors in current trends and historical data to decide which product to buy and distribute to which of its stores for fastest movement of inventory. It is not only able to predict the demand; it also keeps the stores stocked with right merchandize to the right stock level, minimizing waste throughout the supply chain.

 

6.Retail and Technology will become inseparable. To provide consumers with better experience and entice them to make a purchase, the retailers will invest even further in technology.  Artificial intelligence, augmented and virtual reality, internet of things etc will become preferred tools that online retailers and brick and mortar stores, both will exploit to enhance and personalize the buying experience for each customer. For example there will be a smart dressing room uses virtual technology to show a customer how she will look in a particular dress without their having to actually try the dress on. Technology will further invade every step of buying, right from enticing (advertising) to payment and delivery of the product (heard about drones?)

 

Retail world is changing. It was shaped by what was available to the customer for purchase. The customer came to the store to make his purchase. Today, the store needs to reach to the customer and attract him to spend his money in that store. The key attracting factors are going to be faster, easier and more personal attention than ever before.

 

Quick Fixes for Your Biggest Shipping and Fulfilment Problems

Shipping and fulfilment seem easy. All you need to do is stick a label on the ordered product and hand it over to the shipper. It should it delivered to your customer, and world is a happy place. But anyone who has spent any time in the industry knows that it’s anything but that simple. It is one of the key components in the value chain and often can be a nightmare to manage. Imagine thousand of product going out in thousands of different orders in as many combinations, to thousands of locations with multiple shippers. Items will be out of stock, damaged, delayed, returned, sent to wrong addresses and sometimes, despite the best efforts not sent at all. The last one will do most damage to retailer’s reputation especially if he is new to business or has a small business. But all these problems can be handled. Let’s have a look at some of the top issues online businesses have with fulfilment.

 

 

  1. International Fulfilment: With internet the reach of businesses has crossed all oceans. It’s easier than ever before to get an order from across the border. But delivering your product across the border is not as simple as just packing and shipping. International deliveries involve tons of paperwork and rules that must be complied with. There are taxes and customs to be taken care of, which may be different for each country that you ship to. You need to account for extra time taken at the ports, customs and by other government agencies, both, foreign and domestic. But all is not lost. Build a repository of shippers for your most shipped to countries. These shippers should have experience in handling all the paperwork, taxes, customs and should be able to tell you the total cost and times involved, based on the product category. They also should be networked in those agencies and countries that can be leveraged, should a shipment be stuck somewhere. Use their services instead of handling everything on your own. They may charge you a little more for this, but it will save yourself tons of hassle.

 

  1. If you are shipping international, there is a very high likely hood that your product will be shipped in container, on a ship along with many other products, stacked somewhere in between them. This requires extra care while packing. Especially if you need to use ‘freight shipping’. You need to protect your product from damages and delayed shipping. Use durable packing material. This is needed so that products can handle extra stress put on it during international transport through sea. Remember, your box may not end up on the top of the stack and there’s nothing you can do about it. So make your packing extra strong. Use bubble wrap to fill up empty spaces and provide some cushion. Use proper pallets. You shipment should not exceed the weight restrictions of your pallet. The boxes should not be stacked beyond the edge of pallet. Use load protectors to prevent damage from chains, straps and other pallets. Remember, any money you spend on packing, adds to your reputation when product reaches the customer in mint condition, and it has come from abroad!
  2. Customer Trust: This one is a key success factor. If they trust you, they will come back to you and bring their friends and family along. To gain trust, you must reduce errors. Most errors can be attributed to administrative errors. These errors are spread along the supply chain. Wrong product, wrong order, wrong address, wrong delivery (missed delivery time) etc are most common. The error could be small, but may have a large impact. You made a promise to the customer about what he wanted, where he wanted and when he wanted. If you don’t deliver on it, you lose his trust, and potentially the customer too. Train your staff. Make them understand the true cost of errors. Let them understand how a small error can lead to losing customers and harm image of the company. Invest in automation and integrated systems. Correct use of technology can reduce a lot of errors. When the customer calls, be polite. Listen to him. He is calling because he has a problem. The problem is related to your product. Remember, you need the customer while he always has other options (your competitors) to go to.
  3. Customer communication: Once you have received the order, the customer expects the delivery on the right time. But that may be a few days away. Meanwhile, you are working on getting the product from manufacturing, assembling the order, packing the product, shipping and what not to ensure that customer has the delivery when promised. But customer has no communication about it. You should update the customer about status of his order at regular intervals. It could be periodic, or when the order crosses a stage. This is true especially during shipment. Customers like to track their orders. Provide them with tracking number. Make sure that correct shipment tracking code, provided by the shipper, is provided to correct customer. Wrong tracking codes create a lot of confusion when there shouldn’t be one. Test the code before you send it to the customer. It’s a simple thing, just check if the code shows the right address and right customer name.
  4. Stock management: You put up a product on your web store and promised delivery by certain date. You got the order, only to find out that product is out of stock. That is a very tricky situation to be in. Always ensure that you have adequate inventory for each product that you carry. Invest in a good inventory tracking system and automatic ordering system. Integrate your order acceptance system with inventory management system. If an item is not there in the inventory, the order should not be accepted, or at least inform the customer that order will be delayed.
  5. Communication with suppliers: Establish automatic communication lines with your suppliers. The product should be re ordered automatically when the stock quantity falls below a certain level. This is basic. However, it should be done automatically. Your supplier should be able to sense the speed at which your orders are moving and when you will need a refill, and be ready with a refill. Ideally you should never be out of stock for any item.

 

Establishing a fulfilment process with zero errors is impossible. However with careful planning and investment in technology and training, these errors can be reduced to a great extent. In a business world where 99.99% efficiency is not good enough, it is imperative that your processes are well designed to absorb errors before they reach the customer.

 

 

Top 5 trends in Packaging Industry

Consumers today are more conscious and more aware. They care not only about the product they need, but also how using that product is made more convenient for them. And packaging plays a very important role in that. The primary reason of packaging always has been the protection of the product that is being delivered. But today packaging does a lot more than that. Packaging is used as a canvas where the brand communicates with the consumer. It not only attracts the customer, but based on the information that is printed, the material that is used for packaging and the shape and size of packaging; it conveys your brand values to the customer. It tell the customer what your brand stands for, creating a unique impression about your brand, even before your product has a chance to be seen by the customer. Needless to say, packaging in itself has become a key differentiator.  Here are some of the top trends in packaging industry.

  1. Sustainability: Consumers are becoming increasingly aware of environmental issues. They are changing their buying habits to be more environmental friendly. They are increasingly looking for signs on the packaging that manufacturer has a green conscience and increasingly wary of greenwashing. And expert white paper by PWC goes on to explain how sustainable practices have become essential to the perception and identity of the brand. A top sports company has also produced an environmental profit and loss statement highlighting the impact of their sustainable practices on environment, in dollar value. It has become imperative that brands continue to carry businesses based on sustainable practices and also communicate them to the consumer. Sustainability is no longer just an add on. It has become an essential part of the packaging industry. The complete story of where the product comes from, how it was made, is becoming an essential factor in buying decisions of the consumer.
  2. Healthy living: Just like environment, consumers are increasingly adopting healthy lifestyle and practices. They are more conscious of health quotient of the products they consume. In fact there is a whole segment dedicated to products that promote healthy consumptions habits. Packaging is not immune to this. In food and beverage industry, the ingredients’ were always listed as required by regulation. But that is no longer enough. The health benefits of the product also need to be communicated to the customer. Is it organic? It is low in sodium, does have daily dose of essential vitamins that will help to boost the performance while playing the sport? The packaging must focus on communicating the unique benefits of the product and offer transparency in the label. Innovative methods of preserving and displaying fresh food will become the key to long term success. The size of the product, the smaller servings for snacks, which reduce the  intake of sodium, fat and other things to just the required amount, while satisfying the hunger pangs of the consumer will become standard. After all when you are hungry you reach for the box says cookies even if it’s just 2 cookies inside.
  3. Convenience: The way the products are being used by the mobile consumer is very different than how it was consumed at home. The standard box packing of food is not longer suitable for on the go consumption. Be it a beverage, or a sandwich, more and more people are consuming these while walking, or while driving, or when they are simply sitting on the bench in the open park. The design of packaging makes it an important factor in a buying decision is such cases. The smaller, lighter and easily disposable packaging makes the consumption on the go, easier. For other product categories, the ease of transportation and ease of use becomes important factor. Innovations such as dispensers and no mess applicators eliminate the need for additional packaging and make disposal easy. In supermarkets, in food section, many product now coming in reseal able packs. Many producers are moving from plastic to paper based packaging for food items, which is more environment friendly and easier to dispose off. When the competing products are more or less similar, the convenient packing goes a long way in aiding the impulse purchase decision of the consumer.
  4. Cost –effectiveness: This one seems to be a no brainer. However, it has wider connotation than just base packing. Global economic uncertainty is increasing. Consumers don’t want to pay more than what they have to for their goods. And as consumers get savier, they are looking at all costs, the base packing of the product, the transportation, storage and disposal of the packing material. The paper based packaging may look good and meet initial ‘eco friendly’ criteria, but if the consumer needs additional packaging for its transportation and storage, then it’s no good for the consumer. If the packaging is strong and will last longer, much longer than the product itself, again it is of no good to the consumer, if it cannot be reused in some way at home. If consumer is getting his peas in reseal able bags, which he can use for storing other things, after consuming peas, then that’s a very good value proposition for the consumer. The complete cost effectiveness of packaging should be looked at from the point of view of the consumer. After all if he doesn’t purchase the product, the whole value chain is pointless.
  5. Authenticity and trust: There have been several scandals around food industry. Discovery of undesirable meat (eg. Meat of another animal in beef products), Pathogens and foreign elements and inorganic items being sold as organic etc. These deplete the consumer trust for not only the guilty producer, but also for industry as whole.  The origins of the product must be traceable to the source to re establish the trust. Advertising the place of origin on the packaging increases the perception of credibility and authenticity. Packaging should be used to reassure the customer of high quality and truthfulness about product and brand claims.

The retail market is changing. Consumers are getting savvy, more eco friendly and more cost conscious than before. They are more demanding on all these fronts. They now understand that the overall cost of the product is not just retail purchase price they pay. Packaging plays an important role to clam the customer and reassure them that the product as a whole will meet their expectation.

Warehouse Management,

Why Are KPIs Important in Warehousing & Fulfillment?

Warehouse business is a back-end operations business. You don’t control sales, only deliveries. The efficiency of the operations is the key to extracting maximum profits from a warehouse. So you need to know that you are getting maximum return on your investment in this business, just like any other business. But since most of it is a fixed model, B2B business with caveats of B2C (retail deliveries), you need to understand and measure the nitty gritty of the warehouse operations and fine tune them. That’s where the KPI or Key Performance Indicators come in.

A right det of KPIs tells you the detailed performance of your warehouse. Couple it with past indicators, your forecast of business growth and you can figure out where you are heading in future. For example if you are already at maximum space utilization, you cannot expand. A client whose business is growing very fast will need more space. If you can not offer him more space, he will go to someone who has more space. That will reduce you space utilization and also your revenue. Not to mention, you now need to get your sales to run and find a client who can utilize the now freed up space. So while on the face of it a full utilization of warehouse space sounds good, it is not good for a growing business. That is why, it is not only important to have the right KPI, but you also needs to set the right standards for those KPIs. Standards should be the ones that work for you. (Is 80% space utilization good for you, or you prefer 95%?)

Similarly, KPI also help you in benchmarking. benchmarking tells you how good you are doing as compared to others in the same industry. If your KPI is below the industry standard, that means you are not utilizing your warehouse to the best possible extent. You might be making money, but lower KPI means that you are leaving money on the table. You could get more profits by improving those KPIs. On the other hand if you are beating industry KPI but still not making money, something else is wrong somewhere. A well designed set of KPI itself would direct you to where to look. If you are beating the KPI and making money, it looks like a good sign. But it can also mean you are stretching yourself. If you are extracting higher productivity from your machines and spending less on maintenance, you might have to bear a high depreciation and replace the machines faster. If your order cycle time is very less, you might not have any contingency built into the process. That is risky.

Whether you want to stay with the industry benchmarks or set your own benchmark standards, is entirely up to you. While industry benchmarks are there for a good reason, (most of the industry works at those levels) you don’t have to be bound by them. Your KPIs will vary depending on your niche value proposition and your operating model. For example if you specialize in handling delicate products that need more space for storage, your floor utilization will be lower. Also, the KPIs for 2PL warehouse will be very different from the KPIs for 3PL warehouse.

The Supply Chain Operational Reference Model (the SCOR Model), created by Supply Chain Council, provides for over 200 KPIs for monitoring the overall performance of a supply chain. These are broken into various levels to get more granular picture of the business. Some of these could be used for measuring performance of a warehouse as well. Research them to identify which one are suitable for you. Now that we understand what KPIs means and why we should measure them, let’s look at some of the key KPIs for warehousing business.

The main KPIs for a warehouse should focus on Receiving, put away, storage, pick and pack and shipping.

Inventory Accuracy: What is the accuracy of the workers when preparing the product (or order). It is measured by taking the headcount of the items in the stock and comparing it with what’s recorded in the books. This one has direct impact on your working capital and order fulfilment capacity.

Perfect Order Rate: This measures the number of orders shipped to the customer without any incident. The incident could be damaged goods, inaccurate orders, late shipment etc. Needless to say, this one tells you how well is your warehouse operating where it matters the most, the final fulfilment of order, shipped out of the warehouse.

Productivity: This measure tells how many orders are ready to be picked up by the shipper, per hour. Depending on your warehouse business model, it could the number of orders per hour, or total line items per house or it could be the total dollar value of the orders per hour.

Equipment utilization: This one tells about how well your equipment is being utilized. Underutilization of the equipment means you should stretch it more and achieve more. Overutilization mean higher maintenance and replacement costs. Idle equipment depreciates without giving any return. Over utilized equipment can lead to breakdowns and stop the whole chain, leading to higher losses. Your equipment must be running at the optimum rated utilization to extract maximum value from it.

Cycle time: This KPI measures the total time taken since the material came in as inventory and was picked up by the shipper for delivery, as a part of the order. The shorter the cycle time, the lesser the money tied up in working capital. An end to end cycle time would include the transit and transportation time taken by the shippers for the final delivery to the customer’s premises.

Average cost per order: This KPI measures how much are you spending in running the warehouse. It is calculated as total orders fulfilled divided by the total cost incurred for the warehousing operations. The costs include the manpower costs, cost of rejects and returns absorbed by warehouse, cost of damaged products that are absorbed by warehouse, variable costs for running the warehouse (utilities, taxes, rents, insurance,), equipment cost (consumables and depreciation for large equipment) and all other costs. This should be always be as low as possible, as it eats straight into your profits.

There are many other KPI that you can measure to understand the efficiency of your warehouse operations. The finer the KPI, the deeper the control it can provide. However, at a bare minimum, you must keep an eye out for the top line (revenue), the bottom line (profits) and ROI (return on Investment).