Packaging problems in your supply chain lead to higher costs, delays and errors. By standardising packaging and using smart tools such as PackAssist, you can improve efficiency and customer satisfaction. Faes shows how this directly contributes to cost savings and a professional image.
Summary of this article
Does this situation sound familiar? A machine at your customer’s site has broken down, and the required service part needs to be shipped as quickly as possible. The part is in stock or is delivered on time by a supplier, but it still cannot be sent directly to the customer. For example, the packaging may not meet internal requirements for product protection, labelling, identification or handling. As a result, your employees must first inspect, repack and relabel the product.
At Faes, we regularly see packaging become the delaying factor in a process where speed is essential.
A seemingly minor packaging issue can therefore turn into an operational delay. Additional materials and labour hours are required, the order remains in the warehouse for longer and an extra quality inspection must be carried out. For time-critical service parts, every additional process step can increase the total lead time.
The relevant question is therefore not simply, “Which box should we use?”, but rather, “How do we ensure that every service part is packaged immediately according to the correct standard, at every location and by every supply chain partner?”
The direct costs of repacking are usually easy to identify: a new box, additional cushioning material, tape, labels and the time of a warehouse employee. The indirect costs are often higher, but they are not always attributed to the packaging process. These may include:
When these activities take place across multiple suppliers, warehouses and distribution centres, a small inefficiency can be repeated hundreds or thousands of times. This is precisely why packaging management must be considered across the entire supply chain rather than within a single warehouse or department.
For industrial service parts, a standardised approach is often lacking. Suppliers and logistics service providers frequently choose packaging that is practical or cost-effective within their own processes. Further along the supply chain, however, that same packaging may result in additional handling, damage or mandatory repacking. In our white paper, we demonstrate how local optimisation at a supplier can lead to a suboptimal solution for the rest of the supply chain.
The differences may involve more than just the size or appearance of the box. They may also relate to:
Inconsistent execution makes the process dependent on the knowledge and experience of individual employees. This increases variation in quality and makes it more difficult to analyse and improve deviations systematically.
We also see that packaging knowledge is often spread throughout an organisation. Some of it is documented, some is stored in systems and a significant amount exists only in the minds of experienced employees. This makes operations vulnerable when employees leave, temporary staff are hired or the organisation expands to new locations.
A standardised packaging policy does not mean that every service part must be shipped in the same type of packaging. A sensitive electronic module, for example, has different requirements from a robust metal component. The objective is to accommodate as many products as possible within a manageable standard range and to deviate from that standard only when product- or transport-related risks require it.
A sound packaging policy consists of at least five elements:
Standardisation must never come at the expense of product protection. The packaging must be appropriate for the product and for the actual conditions encountered during storage, handling and transport. International packaging methodologies also emphasise that product protection and efficient material use must be assessed together. Where necessary, this should include an appropriate transport test or qualification process.
A packaging policy only becomes effective when employees and supply chain partners can apply it consistently in their daily work. A document on a shared drive or a general work instruction is often insufficient. At the moment of packaging, employees must be able to find the correct, current and product-specific information quickly.
We developed PackAssist to support this process digitally. After scanning or entering a product code, the user can see which packaging is required, how it must be filled and where the label must be applied. Instructions are managed centrally and made available with version control. External supply chain partners can also be connected to the same working method.
PackAssist therefore supports, among other things:
We do not consider PackAssist to be a replacement for packaging engineering. First, it must be determined from a technical perspective what constitutes a safe and efficient packaging method. The software then helps organisations apply that method consistently, at scale and in a controlled manner.
Together with Philips Healthcare, we implemented PackAssist to standardise packaging instructions and working methods across different supply chain partners and distribution centres.
The business case showed that Philips Healthcare would save at least €1 million per year in transport costs. The approach also resulted in clearer communication, more efficient handling, fewer damaged service parts and reduced transport volume. In addition, more than 4,000 improvement suggestions were submitted from the shop floor.
The exact business case differs for each organisation. The potential return depends, among other things, on the number of shipments, the current level of packaging variation, the percentage of orders that are repacked, damage-related costs, transport modes and the extent to which suppliers already follow standardised instructions.
We therefore conduct a separate analysis for each organisation. Savings rarely result from a single measure. In most cases, the outcome is a combination of less repacking, reduced transport volume, fewer damaged products, shorter handling times and a more manageable packaging range.
During a representative period, record how many orders are repacked, why repacking is necessary and how much time and material it requires. Also analyse damaged products, incorrect labels, incomplete deliveries and exceptions. Without a baseline measurement, it is impossible to determine afterwards which improvements have actually been achieved.
Group service parts according to dimensions, weight, fragility, value, transport method and other relevant packaging requirements. Then determine which packaging solutions are frequently used in practice and which variants add little or no value.
Work with packaging engineers to determine which standard packaging solutions can safely cover a large proportion of the order flow. Define separate solutions for sensitive, unusual or regulated products. This prevents both excessive packaging and insufficient product protection.
Begin with one product family, supplier or distribution location, for example. Test the instructions in practice and collect feedback from operators, quality employees and logistics partners. Adjust the working method before rolling it out more widely.
Manage instructions centrally, assign responsibilities and periodically assess whether the selected packaging still reflects the products, transport flows and available materials. Give employees an accessible way to report deviations and submit improvement suggestions.
A packaging project is only successful when operational results demonstrably improve. Suitable KPIs may include:
Comparing these figures before and after implementation reveals where standardisation creates value and where additional engineering or process improvement is needed.
Start by determining whether you can answer the following questions using reliable data:
When several of these questions cannot be answered, the organisation probably lacks not only standardisation in its packaging, but also the process data and governance required to manage it effectively. This is often where the first opportunity for improvement can be found.
Packaging problems are not always immediately identified as packaging problems. In reports, they may appear as additional warehouse hours, transport damage, urgent shipments, long lead times, returns or a growing number of material variants.
In our white paper, “Top 4 Problems in the Packaging of Industrial Service Parts”, you can read more about:
Would you like to identify where unnecessary packaging costs, delays or risks arise in your supply chain? Start by analysing your current packaging process, packaging range and instructions. We can help you develop a standardised packaging policy, design and validate suitable packaging solutions and digitally safeguard packaging instructions using PackAssist.
Our approach goes beyond the packaging itself. We combine packaging engineering, logistics processes, supply chain collaboration and digital instructions into a single manageable solution.
Submit your question through the contact form or contact one of our packaging experts directly.
Thijs Canjels is Business Innovation Manager at Faes and specializes in packaging management and supply chain optimization. In his blogs, he shares insights on efficiency improvements, cost savings and the strategic role of packaging in modern supply chains.
More articles by Thijs CanjelsGood packaging doesn’t just happen by chance. Using a tried-and-tested approach, our specialists guide you step by step from the initial idea to the finished product.
