Reusable Packaging News
RPN
Sustainability
Furthermore, all the sustainability issues facing the corrugated market as a whole come into play even more emphatically in the e-commerce sector, with consumers demanding ease of recycling and returns for their e-commerce purchases.
While lightweighting of board has long been affecting the corrugated industry, rightweighting and rightsizing are playing an increasingly important role in this market too. This is not only in response to consumer demand for efficient packaging, but also in response to the logistics chain’s adoption of dimensional weight (DIM) pricing.
Up until 2014, retailers were charged freight costs on the basis of package weight, but since then many carriers have introduced DIM weight pricing based on the dimensions of the package, and including a ‘dimensional factor’ (typically 166 (in3/lb)) to determine the DIM weight. The major carriers, UPS and FedEx, currently use the same calculation, which is the cubic size of a
package divided by 166 for domestic shipments, and 139 for international shipments. This DIM weight is then used to determine the cost of shipment.
In some instances this has led to significant cost increases, such as a 32-pack of toilet rolls costing 37% more to ship using DIM weight, and similarly a large box of disposable nappies costing nearly 10% more to ship with DIM weight. Similar examples can be found in many lightweight or low-value products, especially in the growing grocery e-sales market.
Next steps
With e-commerce becoming an increasingly important element of retail, corrugated packaging stands to benefit substantially. As the supply and distribution chain for packaged goods changes, new requirements will emerge for corrugated packaging products. This makes e-commerce one of the stand-out areas of growth identified in Smithers Pira’s forecast, The Future of Corrugated Packaging to 2023.