Greg Plemmons, senior vice president of sales for less-than-truckload carrier Old Dominion Freight Line, has lost count of the many “creative” methods shippers employ when preparing their goods to ride on a truck. Shrink wrap that doesn’t cover the bottom of a skid. Boxes of all different sizes and shapes stacked haphazardly on a pallet, sometimes too high for safety. A heavy piece of machinery riding on the same pallet with a bunch of boxes. Pallets of products destined for store shelf display, yet tendered without protective corner boards, extra cardboard dunnage, or slip sheets.
“Nowadays, nobody is keeping much inventory,” he says. “Warehouse folks are in a rush, goods are coming in at the last minute, so there is no wiggle room built in to allow for [the replacement of] damaged goods.” It’s also a sign of today’s hyperactive e-commerce–driven markets. Carriers must account for palletized and irregular-shaped industrial shipments from factories, coupled with those moving between warehouses and from distribution centers going to brick-and-mortar retail sites, as well as those destined for the consumer’s doorstep.
One somewhat unsettling trend: As packaging costs have increased and pressure to deliver intensifies, some shippers appear to be taking a “minimalist” approach, says Joe Medeiros, senior director of operations excellence at pallet rental company Peco Pallet. “Shippers are just shrink-wrapping stuff instead of combining things in a larger box and arranging boxes in an integrated pattern on the pallet for maximum safety and integrity,” he says.
The most common mistakes shippers make when building a pallet: letting boxes overhang the edge of the pallet, so the product “droops” and potentially can be damaged by freight handling equipment; “chimney stacking” products on a pallet instead of alternating the layers, which is a demand of big-box retailers who want boxes all facing the same way so they can go from truck to store floor with little additional handling; using an incorrect box; improper stacking; not using cardboard corners and slip sheets; and not using enough layers of shrink-wrap.
Taking such shortcuts “ultimately exposes the product to damage, the cost of which almost always outweighs what they thought they’d [save by] using less material,” he says.
ODFL’s Plemmons agrees. How shippers make packaging decisions, select material, package goods for shelf and shipping, and build out pallets makes a difference. Yet once it’s in the carrier’s hands, keeping that shipment claims-free takes extensive training, investment, and good old-fashioned “blocking and bracing.” That’s critical to damage prevention and can help alleviate poor packaging and pallet loading, he notes.
“The forces that come into play in the back of a trailer as it rides down the highway are considerable,” he says. ODFL did a test where it placed cameras inside a trailer, then drove it at 5 mph over a couple of speed bumps. “You would be amazed [at what happens] when something is not properly braced and loaded high and tight,” he says. “Fifty-gallon drums jumped a foot in the air. Space is your enemy when you are going down the road.”
Among the investments ODFL makes yearly to secure cargoes: 1.7 million air bags, 300,000 cargo straps, 15,000 rolls of corrugated paper, 2.5 million sheets of triple-wall cardboard, 10,000 pallets, and 90,000 sheets of plywood. And those investments have paid off. For the 12th consecutive year, ODFL was No. 1 in the annual Mastio study of less-than-truckload (LTL) carrier quality performance. The company boasts the lowest claims ratio in the business.
RISING COSTS ARE HERE TO STAY
Rising costs across the board are a reality that is not changing anytime soon. And for shippers, carriers, packaging engineers and vendors, and technology providers, it has ratcheted up the complexity—and cost—of matching the right product to the right box and packaging material to meet the need for speed and still survive the bumps and jolts of multiple distribution channels.
Demand for packaging material has exploded. Rachel Kenyon, senior vice president of the Fibre Box Association, the packaging industry trade group, notes that packaging material use has paralleled the burgeoning growth of e-commerce.
The industry produced roughly 390 billion square feet of corrugated product annually through the early 2000s, gradually increasing through 2018—due to the Amazon effect. Then the pandemic hit, creating a temporary dropoff, but as consumers began ordering any and all things online, volumes resumed their climb, to 407 billion square feet in 2020 and 416 billion square feet in 2021. Kenyon attributes much of that growth to e-commerce.
Importantly, Kenyon notes as well that recycled cardboard and paper continue to make up a significant share of raw material for new boxes. In 2021, 91% of cardboard produced and used was recycled. Consumers also are doing a better job on the recycling front, she says.
Ideally, boxes and packaging are engineered for things like weight, cube, and “burst” strength requirements that are specific to ensure protection of the product, with little extra space and the strength to survive transport and arrive at the store ready for the shelf, Kenyon notes. Yet today there are so many different distribution channels that add complexity and challenge.
“In an omnichannel world, you might have one box for a product, but you have to ask how is it reaching the end-user? Is it going to a consumer’s home or to a retail store, or another distribution channel with a third party? Is it moving in a parcel network or LTL? All that affects the decision, and it’s hard to take one box and make it do it all,” she explains. As a result, “sometimes you have overpacking to make sure [the product is protected] because you are engineering for any eventuality.”
TECHNOLOGY TO THE RESCUE
Much like technology has altered how we receive and consume information, it has also changed how products are packaged and shipped, the materials used, and how goods are presented to consumers. “It seems like technology plays a role in every part of our lives, and packaging is no exception,” observes Tobias Grasso, president of the Americas at Sealed Air Corp., perhaps best known for its ubiquitous Bubble Wrap-brand protective packing material but also a leader in automated packaging systems. “The protective packaging design process is continually evolving to keep up with changing technologies, materials, and logistics needs,” he notes.
Sealed Air offers a variety of products and systems to help shippers automate the packaging process and produce “right-sized” packaging that delivers proper cushioning to protect goods in transit. “The overarching objective remains the same: provide optimal product protection while utilizing the least amount of material and relying on engineering principles and strategies to customize solutions for each product and its shipping environment.”
He adds that the role of package integrity testing also is critical. Such testing helps validate that the packaging solution will do the job before the product ever ships in the real world.
According to Sealed Air, testing protocols can be created to screen for package integrity or to mimic actual transportation environments. Conducted in a controlled lab setting, typical tests might include vibration, dropping, and compression of a package, sometimes with a weighted load on top.
A vibration test might mimic an air, train, or truck delivery. Drop testing might shock-test a package from different corners, edges, and faces, from specific heights. All such tests provide valuable feedback for improvement while demonstrating and confirming the package design and construction meets performance expectations.
Grasso sees digital printing technology as a game-changer with promise to make packages “smarter”—for both consumers and shippers. “Digital printing allows every package to have a unique ID using different kinds of scannable codes,” he explains. Sealed Air recently launched Prismiq as a new digital packaging brand. The system, says Grasso, offers unmatched speed and flexibility, and is able to print on a variety of packaging goods such as bags and shrinkable materials. He believes such innovations “improve value by enabling automation, better traceability, and personalized connections with the consumer.”
SHIFTING AMONG CHANNELS
One challenge from the e-commerce boom has been the need for companies to shift from packaging products for retail store shelves to packaging them for direct-delivery to end-consumers. “A lot of [companies] were not really prepared for that significant of a shift,” says Marti Gooch, president of ShipStore, which offers a multicarrier shipment planning and optimization software platform, primarily for parcel and LTL. He sees a lot of shippers still using oversized boxes and excess packaging—which increase both packaging and freight costs.
To address that, ShipStore’s software takes in all of a product’s dimensions, assimilates those dimensions along with shipping information, and recommends the most effective box for the product and shipping need, “rather than allowing the picker on the floor to pick just any box,” he notes. “Shippers need to automate this decision and use technology as much as they possibly can,” he emphasizes.
Another trend is shippers using “box on demand” systems, which literally build the box to spec on site as the product is coming off an assembly or fulfillment line. “Our system can send the product dimensions to the on-demand machine, which then builds a custom-sized box at that moment,” he says.
With shippers’ box and packaging needs becoming ever more complex, “you have to be better at managing the edge crush test, how strong that box is relative to the product’s weight and where it’s going,” he says. “It has to be the right strength to survive the rigors of the distribution cycle,” whether it’s a parcel conveyor system or a truck running over potholes.
THE MISSED OPTIMIZATION OPPORTUNITY
Paccurate, which describes itself as a “carton optimization platform,” is another software system that helps shippers determine the ideal packaging configuration—for the product itself as well as to optimize shipping cost.
“Basically, our system tells the customer to use this box with this strength for this product running in this [distribution] channel,” says James Malley, Paccurate’s chief executive officer, who adds that the analysis not only optimizes for the best packaging/shipping solution, but also generates detailed real-time packing instructions to guide the packer on the fulfillment floor. The software platform also will take in the specifications for all of a shipper’s products and run simulations to help shippers accurately determine what size boxes to keep in stock.
In today’s e-commerce world, “the pressure is on to get the product out the door to the parcel carrier, or on a pallet ready to ship,” Malley notes. “Many don’t realize the scale of the opportunity to optimize for both packaging and freight beforehand,” he explains. “You can minimize the spend on corrugated. There also is a capacity resilience piece. When you adjust package size, without reducing strength or needed space, over thousands of packages, you’re reducing the amount of cube taken up in the trailer—and the number of trailers going out. Just by doing a little tweaking at the box level.”
With the cost of corrugated skyrocketing and record-high freight rates, Malley says demand for this type of packaging optimization is exploding. “We had more demo requests in the first quarter [of 2022] than in all of last year,” he says.
How can shippers ensure that the packaging they are using is both cost-effective and provides the necessary strength and protection to ensure product integrity? “Hire a [packaging engineering] professional and get them involved at the very beginning, when the product is being developed,” advises Ernie Schlitt, senior project manager for Stephen Gould Corp., a family-owned firm that has been in the packaging supply business for decades.
When designing a product and determining how it’s to be packaged, “you have to look all the way down to the end of the supply chain and understand what extraneous costs [will result from that design and the effect they] will have on shipping expenses in the end. If you could make that package one inch smaller, what would that save? Those decisions must be considered on the front end,” he says. “Once the product is being tooled, there’s no going back.”
