Tom Andel

Don't settle for empty boxes
March 25, 2008

Having written for a magazine that serves the paperboard packaging industry, I try to stay up on how trends in that market will affect its customers—most of whom are Modern Materials Handling readers. One thing I came to appreciate in covering the world of brown boxes is how important becoming a more active part of your supply chain is to their competitive edge. Physical proximity is a big part of that.

That was one of the reasons International Paper just signed an agreement with Weyerhaeuser to purchase its Containerboard, Packaging and Recycling (CBPR) business for $6 billion in cash. IP identified profit improvement opportunities of about $400 million annually from the acquisition. Reducing duplicate overhead costs, integrating manufacturing operations, optimizing product mix, and improving operational and supply chain efficiencies will contribute greatly to that income.

In the meantime, a major competitor, MeadWestvaco Corporation, announced a new corporate identity for itself: “MWV: How brands take shape.”  The key contributor to this identity is the company’s global presence and its ability to deliver supply chain efficiencies.

For paperboard packaging providers, being part of their customers’ supply chain means doing business everywhere their customers are doing business and even getting involved in strategic issues like product design and environmental sustainability. My media contact at MWV, Alison von Puschendorf, told me the company’s transformation started after selling its coated papers business, and will continue with the help of the premium consumer packaging solutions market.

“We are getting more vocal about our expertise in sustainability, including everything from fiber sourcing to the way we design packages,” she said. "This includes the kind of materials used, how we can develop new materials or combine materials that best suit the products in the marketplace.”

When I was covering the paperboard packaging market, I talked to several of that market’s high-tech manufacturing customers that were trying to be more cost effective by strengthening the design of their products so they could have smaller, lighter-weight packaging. Their corrugated converters were also helping them figure out how to fit more pieces into a container load for overseas shipping to decrease transportation costs. Converters and their customers are discovering that collaborative product and packaging design pays off in more efficient materials handling.

If all you’ve been getting from your packaging providers lately is brown boxes, it’s time to repackage that relationship. Tell us how that's working for you.

Posted by Tom Andel on March 25, 2008 | Comments (0)