Automation to Optimize High-Velocity Packaging

Meant to protect products during shipping, packaging is a crucial aspect of e-commerce, a sector that consumers spent $504.6 billion on in 2018 alone. Most of those goods are shipped to homes and offices, where the “unboxing” experience—people opening boxes and narrating their actions on video—is so prevalent that it has become a YouTube phenomenon.

But how many times have you received a huge box via UPS or FedEx and opened it up, only to find a tiny product huddled in the corner, surrounded by an entire roll of bubble wrap? Not only is this a waste of space, packaging materials, and shipping fees, but it also puts your recycling bin or trash can on overload and eventually impacts the environment.

At the other end of the spectrum are the packages that clearly weren’t meant to hold their contents, including the flat-pack envelope that arrives at your doorstep bursting at the seams.

E-commerce shippers’ packaging challenges don’t end there. There’s also a tight labor market, DIM weight charges (for oversized products), and inefficient picking and packing processes to contend with. In this Insider Q&A, Neopost’s Director of Automated Packaging Solutions, Steven Brandt, explores these challenges and shows how companies can reduce their costs and footprint with an automated packaging solution for e-commerce.

Insider Q&A

Steven Brandt - Director of Automated Packaging Solutions, Neopost

Q: Why is packaging such a big issue for today’s e-commerce shippers?

A: Social media is a big driver; you see a lot of these unboxing experiences posted online, either in video or via comments from customers or end users. Many people are very conscious about not only how much dunnage material is in their packages and the associated environmental effects, but they also complain about their overflowing recycle bins.

This all stems from the fact that the companies they’re purchasing from are not optimizing the packaging experience. This, coupled with more CEOs who are interested in helping our environment, are some of the many things driving sustainability measures within distribution centers.

Q: Are companies responding to these trends?

A: Many shippers haven’t concentrated on this area because there’s a perception that a lot of work has to be done to “fix” the processes. For example, a lot of shippers think that they have to invest in a dimensional scanner to scan every single item, and then utilize software to determine how to put a box together and figure out what carton to use, and so forth.

They simply do not have the time and resources for these projects. This is just one of the reasons why companies haven’t taken the time to optimize this area of their fulfillment operations.

Q: Why can’t shippers ignore this any longer?

A: With the current labor shortage really impacting warehouses and DCs, it can’t just be business as usual. Companies really have to start looking for new opportunities to automate and optimize their packaging operations.

Q: What’s the best solution for today’s e-commerce shippers?

A: There are different solutions on the market today that automate the order-packing area of a warehouse or DC, with most of them falling into one of three categories: 1D, 3D manual, or 3D automation (with the “D” standing for dimensional). The 1D category includes solutions that reduce box height, but not length, width, or material usage.

As a result, the shipper using this solution would have to maintain more box SKUs in its inventory to meet the variety of order sizes. 1D solutions do help reduce companies’ labor needs, so if your goal is to reduce labor, but not necessarily volume or material, or improve the customer unboxing experience, then it may be a good solution for you.

A 3D manual solution can effectively reduce the length, width, and height of a box, which offers savings in the area of DIM weight charges. They also ensure that you’re using the least amount of corrugate and packing materials as required for that order. However, from a throughput or labor perspective, these 3D manual solutions are really on par with a typical manual order-packing process.

Finally, 3D automated solutions tend to be most applicable in warehouses and DCs that are managing higher shipment volumes for the majority of order volume. 3D automated solutions auto-box each single- or multi-item order to create the perfect, custom fit-tosize box around the specific order. It also incorporates the taping, weight verification, and print-and-apply shipping label process, all of which comes together for an optimized packaging solution.

The CVP Automated Packaging Solution, for example, makes fulfillment faster, more reliable, and more efficient than ever before. This decreases the need for excess labor and can save up to 16 laborers per shift. You are ensured optimal labor, shipping and material savings, especially during peak seasons.

We also have many different certified fan-fold corrugate vendors to choose from, which means you get fair pricing and flexibility for commodity items. The most efficient, higher-volume companies typically apply a combination of these solutions, as well as auto-bagging technology, to meet their package fulfillment needs.

Q: How do 3D automated solutions make companies and their shipments more environmentally friendly?

A: They decrease the amount of material used for each box. It’s about creating only the box volume necessary for that specific order—nothing larger. Because it’s a fit-to-size box, 3D auto-boxing eliminates dunnage required for that specific order. And then finally, because a box is created for each specific order, less material is used because the exact amount of corrugate needed is cut.

Q: How does a company determine the appropriate level of packaging automation?

A: Each company must determine its own goals for the order-packing area to choose the right level of automation. Is it reducing costs? And if so, in what areas? Is it to provide more environmentally-friendly packaging? Is it to increase throughput? Based on these goals, coupled with daily order packing volume, companies can quickly determine the technologies that they should explore.

Q: What makes the CVP Automated Packaging Solution different from other options on the market right now?

A: We’re on our sixth generation of this technology, which translates into very high reliability within all our end users’ installations. Reliability is critical when you automate the order packing area, just like a sorter within a DC. The CVP becomes the heart of the process and it must be able to run continuously.

We’ve made investments with our nationwide support and parts infrastructure, which augments our reliability and uniquely positions us in the marketplace. Our CVP-500 Automated Packaging Solution has a machine throughput of 493 orders per hour. Our future units will auto-box even higher volumes. It’s also the only 3D automated solution that can handle both single- and multi-item orders, as well as hard and soft goods, with no additional equipment or operators.

Q: What are the top benefits of implementing this solution in a package fulfillment operation?

A: We’re amazed at the number of different industries and applications where the CVP has been implemented—anywhere from general merchandise to e-commerce, to auto parts, to computer manufacturing, and everything in between. One of the three basic drivers for justifying a CVP is the amount of labor reduction required to process orders in the order packaging area. Number two would be the amount of volume reduction for each of the boxes that we produce, which translates into real shipping savings. And then finally, the amount of corrugate reduction usage is also a primary factor.

On average across all of our installations, we help companies save 88% in labor costs, 32% in freight reductions, and 38% in material costs. Through these savings, one shipper that manages an average order volume of about 2,400 orders per day is able to experience a return on investment in as little as six months. In addition, our customers are not posting negative unboxing experiences. Corrugate is environmentally sound and a fit-to-size box experiences less damage (thus less returns due to damage) for our customers.

Q: How long does it take to implement a CVP?

A: On-site installation time is less than five days. We fully manufacture, quality inspect and operate the CVP before it leaves our manufacturing plant. The CVP is shipped in two separate units to the site which allows for plug and play installation once it arrives.

Q: How should logistics or warehouse managers go about assessing their needs for this level of package fulfillment automation?

A: In most cases, you need to fulfill at least 1,000 boxed orders per day to get a strong justification of 24 months or less. However, there are other factors which will reduce this general rule. As an example, we’ve installed a CVP-500 for a customer that could only produce 50 orders with manual packing per day. Now, they are producing a volume of 500 orders per day with the CVP, which ultimately justified their investment.

Any volume above 1,000 orders per day will accelerate the ROI. What I tell companies is this: If you’re challenged by the labor shortage and not finding enough laborers to package your daily order volume; if you haven’t explored automating your order packaging area; if your carrier charges by DIM weight; if your customers are posting negative unboxing experiences on social media; if you want to use less material; if you want to provide your customers with an environmentally-friendly order experience; or if you’re trying to reduce the overall box inventory that you carry, an automated packaging solution by Neopost is definitely worth exploring.

NEOPOST

195 Chastain Meadows Ct NW, Kennesaw, GA 30144
Email: [email protected]
Phone: 855-210-2489
www.packagingbyneopost.com