Here are some simple precepts when working with a packaging company, ones you may not have thought about before, that can be indispensable to your overall success. A lot of what follows focuses on business relationships and an understanding of the other’s point of view.
#1 Business Is Not Just Business, It’s Also About Relationships
It is important to foster and nurture a good relationship with the company that is providing your packaging. Why? Because, as you are undoubtedly aware, packaging is one of the most important aspects of selling your product.
It’s very beneficial for you to recognize that even though a packaging company will value your business, your “value” as a customer will have its limits (unless you are a Fortune 500 company). If you are too difficult to work with, your packaging supplier may drop you as a customer which could leave you scrambling. I’ve seen it happen, though not often. But what’s more common is that the quality of your experience with them will decrease because they just won’t care that much if you take your business to someone else. In their minds, you’ll be someone else’s headache. Of course, that absolutely does not mean you should be a doormat, you most certainly need to make sure your needs and concerns are being addressed.
#2 Do Not Necessarily Assume People Are Trying to Rip You Off
Most reputable packaging companies will offer you a reasonable price. Why should you assume this? Most brokers or sales reps know that if the price they quote a potential client is on the high end, that potential client will simply cease any further communication. There is more competition out there than ever before and packaging companies know they need to attract customers with reasonable prices straight out of the gate. Years ago it wasn’t like this. Things have certainly changed in this global economy. There is not only more competition, but the margins are smaller and the cost of manufacturing has gone up.
#3 Don’t Just Consider Price
Price is an important factor, no doubt about it. But there are so many other factors that can make price differences between packaging suppliers seem much less significant.
Does your broker or sales rep answer your calls or emails quickly? Do they listen to your needs and concerns? Do they give you regular status reports and updates? Do you feel as though they are your advocates? Do they offer solutions, tips, and compromises that work to your benefit?
If you cannot say yes to any or all of the above questions, then I have one further question: are a few pennies difference per unit between suppliers really worth it? If your volume is very high, then a few pennies can be significant. But if your volume is medium to low, you may want to reconsider being “penny wise”.
Are you getting any freebies thrown in? i.e. free shipping, free graphics work, a free prototype or cutting die? These items can add up if you have to pay for them and will indeed affect your unit cost.
Make sure you are aware of any hidden fees. Some packaging companies can offer you a wonderfully low unit cost, but once you are in the door, they can burn you with all these extra fees. They may tell you that these fees are “one-time” only and when you re-order in the future, you won’t have to pay them again. Sounds good, but are you guaranteed that same “wonderfully low unit cost” when the time comes to re-order?
Can your packaging company offer you free warehousing?
Let’s say you want 10,000 units and it will cost you $0.50/unit. The packaging company may offer to run 20,000 units at $0.38/unit and warehouse, for free, the remaining 10,000 units until you need them. This can be very attractive.
What is the lead time? That is to say, how long does it take for the company to provide you with packaging once everything is finalized? Lead times can vary greatly. If you need packaging quickly, lead times can certainly be just as significant as price.
For further reading, here is an article on price quotes for packaging that offers some additional thoughts along these lines.
#4 Count Your Blessings
What if you’ve been working with a packaging company and they seem to messing up lately or you find they are suddenly difficult to work with no matter how flexible you try to be. Should you jump ship and find a new packaging supplier? Maybe. But consider a few things first.
How hard will it be to move to another company and start fresh? It will be extra work and there will be some inconveniences at the very least. It’s an important decision and you must weigh the potential consequences carefully. Obviously, unless the packaging company is completely horrible, it’s always best to communicate your needs and concerns and try to solve the problems you have with them in a polite and reasonable fashion (if possible).
What things has your present packaging supplier gotten right? What are the good things they have done for you in the past?
Your packaging supplier might just be going through some internal issues or changes, resulting in less than satisfactory quality and service. That’s not your fault. However, it’s beneficial to consider all the times they may have gone the extra mile for you, or at the very least, done a good job for you. Once their issues are resolved (and if you’ve had a good relationship with them in the past, they should be honest about any internal problems they are having) they’ll appreciate your loyalty. This can result in you getting preferential treatment. I’ve seen it happen.
Finally, make sure that it is not just an issue with the actual manufacturing of your packaging. What I mean is, some types and styles of packaging can be more difficult to manufacture than others. So if your packaging is particularly difficult to manufacture you may find that any other manufacturer you decide to use will struggle with the same issues.
#5 Sometimes Insisting on That Super Low Price is Not Such a Good Thing
There is a threshold where an ultra low price will indeed affect quality. If you are an inflexible, hardcore haggler always insisting on the lowest possible price, be careful, you may end up with packaging that reflects that “ultra low price” in every way. Often times manufacturers will cut corners by scrimping on quality control or paper quality or any one of dozens of other variables in order to hit your (perhaps unreasonable) price point. While this is an unintended consequence from the manufacturer’s decisions, that old adage applies, “you get you what you pay for”.
#6 Give Yourself Enough Time To Sort Out Potential Problems
There are occasions when you are, through no fault of your own, under tremendous time constraints. That’s life. But often times people procrastinate on ordering packaging, or simple don’t factor in enough time in case problems with the packaging occur. If you need packaging by a certain date, try to give yourself enough buffer room (based on the lead time of the packaging company) in case you have to completely re-run the entire lot, or even a portion of it. You’d be surprised at how many people do not give themselves ample time “just in case”.
#7 What to Do When Things Go Wrong
There are times, albeit quite rare (hopefully), when the packaging you order does not turn out the way you intended. Either the color is not quite right, or the ink is chipping off at the seams of your folding carton, or there is a major typo that was missed, or any number of things. What do you do? Well, this is where giving yourself enough buffer room between when you acquire the packaging and when you actually need it comes into play. Assuming you have given yourself enough time, here are some steps that you should take if your packaging isn’t what you expected.
1. If you have a co-packer, show them what the packaging is supposed to look like and then instruct them to call you immediately if there is any doubt about the appearance or quality once the packaging arrives. But really, you should be inspecting the packaging first hand whenever possible.
2. Document everything; times, dates, any witnesses, take clear photos. Again, if you have a co-packer, get a statement from them and have them sign it.
3. Contact your packaging company and tell them there is a problem.
4. Do not use the packaging. The packaging company will either have to run the job again, or, if the packaging is still usable, give you a discount. If they run the job again, keep the defective packaging. They will either request it be returned to them or destroyed, or whatever other agreement you work out with them.
5. Finally, and this is more personal opinion, don’t lose your cool and threaten “to take your business elsewhere”. That kind of thing rarely yields results. If you really want to take your business elsewhere, just do it. However, in most cases, everyone involved is doing the best they can and wants the situation to resolve so that everybody wins.
I hope you find these ideas at least interesting if not helpful. Please feel free to comment if you liked or disagree or wish to add something that I may have overlooked.