Losing Dimensional Weight in the Supply Chain
I have held previous positions where there was a separation between packaging engineering and logistics. “We design what the customer wants, then it becomes logistics’ responsibility to calculate and figure out the method and costs for moving it around.” Over the past year at ModusLink I have had several dimensional weight projects come across my desk that show how these two disciplines are so clearly interrelated.
Dimensional Weight Explained
For those not familiar with the term “dimensional weight,” let me explain. When carriers ship parcels by air, there are two different ways to cost the freight. These two categories are actual weight and dimensional weight. Actual weight is basically that—the actual weight of the item. In order to avoid losing money by shipping air in a too-large container, carriers will also calculate the dimensional weight of a parcel. This is often done with a formula such as (length x width x height)/constant. The two numbers are compared and the one that is larger is what the carrier will charge.
Building Efficiencies with Package Engineering
In the submitted case study for our most recent Green Supply Chain Award, our client was using a stock package for shipments that were predominantly orders for a single phone, although the box could accommodate more. As a result, they were shipping unnecessary amounts of air and being hit by the larger dimensional weight shipping costs.
By designing size-appropriate packaging, ModusLink was able to have shipments charged at actual weight. This relieved the client of the dimensional weight surcharge for over 90% of their orders.
Another benefit with this redesign is the elimination of unneeded bubble wrap. Not only is this a material and labor costs savings, but the lack of excess packing material also gives an improved out of box experience. By removing bubble wrap, which the customer ultimately has to throw away or try to reuse or recycle, and reducing the shipping box’s size, our client was also able to achieve a reduction in the carbon footprint for the packaging by decreasing the CO₂ generated to produce the packaging materials.
Improving Sourcing, Assembley, Shipping & Sustainability
Combining packaging engineering with logistics is the smart approach. In this case, it checked all the boxes (pun intended) and provided a package that was less costly to ship, less costly to source, measurably more sustainable, easier to assemble and a better experience for the customer.
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