Tips for Packaging Optimization

Jan 10, 2012 2:59 AM  By

Increasingly, carriers are looking at package cube when pricing transportation. Why? because virtually every form of transportation, from airplanes to truck trailers, rail, ocean, and air freight, tends to “cube out” before it reaches it’s maximum weight capacity. And this recent change is reflected in the ever tightening DIM factors that carriers have introduced over the past two years.

What is cube optimization? It means right-sizing your packages and fitting your orders into packaging dimensions that are as small as possible without threatening the integrity of the order.

Cube optimization analysis is a study of actual weight versus dimensional weight with the objective of reducing or eliminating dimensional weight charges in favor of actual weight charges.

Merchants should conduct a comprehensive and detailed cube analysis with an eye toward determining where these improvements can be made for better package optimization. Cube improvements will result in a number of downstream benefits:

  • Less corrugated utilization.
  • Lower damage rates due to smaller, stiffer boxes.
  • In some cases, billing weights will drop by one lb or more, due to less packaging content.
  • Reduce or eliminate dunnage material.
  • Better fill rates for ocean containers, pallets, and air freight ULD’s
  • Increased distribution center shelving capacity-more SKU’s in less space.
  • Better DC throughput per hour or shift.
  • For retail packing, more SKU’s per lineal foot of shelf space.
  • For B2C shippers, more units per master pack.
  • Lower shipping rates, regardless of carrier or mode.
  • Fewer billing corrections. carriers typically employ scan tunnels to dimensionalize shipments, and the error rates can amount to 2% or more.

Merchants should consider the following tips regarding package size and construction for any parcel/small package shipper, whether shipping domestically or internationally:

1) Do not exceed weight limit of 150 lbs – separate into component pieces if possible.
2) Packages should be less than 108 inches in length to avoid oversize charges.
3) Do not exceed dimensional limits of length and girth- 165 inches combined to avoid oversize charges.
4) Consider using biodegradable and reusable packaging rather than “Styrofoam” and “plastic popcorn” to reduce costs in the evironment.
5) Use rectangular shaped packages if at all possible and create a package that can be stacked at least four high for better space utilization.
6) Some companies place RFID tags and impact sensitive devices on their products depending upon the value and fragileness of the items shipping. These devices provide valuable information on where and how damages can occur and what needs to be done to eliminate the problem. Here is the website of an RFID manufacturer that provides that service.
7) Consider consulting a packaging engineer to minimize the amount of “air” of unused space in a package.

Doug Caldwell is a sales director with AFMS Logistics Management Group; Tom Stanton is an international analyst with AFMS.