WHAT’S NEW IN PACKAGING OPTIONS?

April 23, 2013 1:35 to 2:30PM

Speakers

Steve Martin Vice President of Operations, Strategic

Fulfillment Group Ken Myers

Director – Packaging & Automation Division for Tension Corporation

Direct-to-the-Consumer

Order Fulfillment Packaging Options

Strategic Fulfillment Group Core Services

CComprehensive fulfillment services, including:

• Order filling • Specialty packaging • Direct to retail & wholesale • Event & Membership • Call center • Mail processing/lettershop • Specialized marketing consultation and

support • Postal consulting/mailing analysis • Marketing database • Data entry – data processing

All of your fulfillment and marketing needs in one location with a partnership focus.

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Challenges

We view all fulfillment needs as a true partnership with both sides partaking and

profiting from shared experiences. Fundamentals Continuous improvement Repetition Audit & review procedures Share in cost savings Customer Satisfaction

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Packaging is a $570 Billion Global Industry

Industry Stats

$ billions

United States

65%

16%

1%

16%

3%

Plastic

Glass

Metal

Paper

Other

Technology Driven

Based

Customer Service Order shipment notification & tracking Driven by social changes, ethics, politics

and economics Increased shelve life

24 HOUR DEMANDS

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Pushing the development of new innovative packaging

Challenges

Demanding Customers Product Diversification E commerce Same day shipping

Space Limitations With Growth comes new challengesPackagiptions Increased SKU’s

Distribution Options USPS 18%, FedEx 24%, UPS 42% Co-mingle Direct

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Changing your package strategy

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Challenges

Flexibility Do you automate or do manually Tailor your packaging to your clients needs Generic alternatives

Packaging Branding Custom Generic

Automation Labor vs. packaging cost Is their a market beyond your current needs Improve turn around time Reduce Space

Meeting your objectives

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Challenges

Production Set up One Shots Generic alternatives Can you combine with other jobs Time Studies

Packaging Branding Generic Custom

Postal Requirements Time in transit Cost

1.5 lb package – mixed content, low cost a factor – SmartPost 1.5 lb package – book, no tracking needed – BPM 1.5 lb package – expedited shipping a priority – UPS Priority or UPS ground

Tracking ability

Special handling needs

Flexibility

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Challenges

Flexibility Over 100 Sku’s for boxes Over 50 Sku’s for envelopes

Packaging Branding Increase time & cost Avg. person views a package for 1.6 seconds

Custom Tailor your packaging to your clients needs

Generic Emergency shipment Stock issues Product changes

Packaging

Challenges

Filler Adds 5 cents per package Doesn’t enhance the presentation Recycling nightmare

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Packaging

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Challenges

Auto Label Do you automate (inline or stand alone) or do manually Tailor your packaging to your clients needs Generic alternatives

Packaging

True partnership Labor vs. packaging cost Market beyond your current needs Improve turn around time Reduce Space Organic growth Custom

Automation

Right-Sized Packaging On Demand ONE PIECE FLOW

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One SKU per box Increased foot print Additional labor to sort

and stage boxes Reduced Sku’s Fanfold corrugated

Challenges 15

Solutions

Multiple SKU’s Increased foot print Additional labor to sort and stage

boxes

Smaller footprint Reduced Labor Quicker turn around Greater Flexibility

Concern

Solution

Challenges 16

Solutions

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Challenges

Sustainability & Profitability Lightweight

Reduce the size while not reducing space Biodegradable plastic

Reduce landfill waste and reduce carbon footprint. Recyclable plastic 100%

HDPE food Containers, bottle caps, pipe

PET beverage, food and other liquid containers Recycled paper Strength Versatility Won’t break your budget

eco-friendly options Global market for sustainable packaging is $142.42 billion

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3PL providers

Supply chain logistics FTL, or Full Truck Load LTL or Less than a Truck Load Hotshot (direct, exclusive courier) International 1PL, Shipper and consignee 2PL, actual carriers, owns their transportation, planes, trains & boats 3PL, outsourced or 'third party' logistics services 4PL, consulting firms that build and run supply chain solutions

Provides multiple logistics services such as transportation, warehousing, cross-docking, inventory management,

packaging, and freight forwarding

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3PL providers

Third party logistics LTL – Pay by weight

SAIA, FedEx logistics, Estes

FTL – Pay for the complete truck

Can make multiple drops

Third Party – Pay by size and weight UPS, FedEx, DHL

Challenge's

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3PL providers

Third party logistics LTL – Pay by weight

SAIA, FedEx logistics, Estes

FTL – Pay for the complete truck CH Robinson, England , Echo Global

Third Party – Pay by size and weight

UPS, FedEx, DHL

International – Pay by size and weight UPS, FedEx, DHL

Challenge's

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3PL providers How to decide

Weight Over 150 lbs. Freight Under 150 lbs. 3rd party

Package Size DIM

Full or Partial load Palletizing Specialized handling, unpacking etc.. Insurance Documentation Tacking

Other Concerns Always 3 bids ( depending on lanes and destination) Customer Service Tracking

Challenge's

Direct-to-the-Consumer

Order Fulfillment Packaging Options

E-Commerce Sales Forecast

E-Commerce Apparel Sales Forecast

Obstacles Retailers Face Selling Online

Obstacle Total (%) Inability to touch and feel goods 40% Order fulfillment 27% Online adoption curve 23% Customer experience 21% Site Security 20% Customer acquisition 19% Trust 19% Profitability 14% Branding 13%

Source: Forrester Research

Completing the Customer Experience

What can you do from the operations side to help turn people that order from your company into lifetime customers?

Your package that your customers receive at their door represents your company

Did it get there on time? Did it look good and did it present your products

with the right image? Is this what I ordered and can I return it easily and

without a hassle if it’s not exactly what I want? Was this a good customer experience and will they

recommend your company to others?

Customer Delight

Executive Focus Operational Compass

“A focus on delighting others is not a fad or hype or dumb. It is how we advance along a path of genuine human excellence.”

Steve Denning, author The Leader’s Guide to Radical Management: Reinventing the Workplace For the 21st Century

Brand Differentiation

Innovate and Experiment (engage experts) Estimate Value Measure (surveys, bizrate, etc)

lynsire.com/2011/07/i-love-animals.html

Order Fulfillment

Hand Packaging vs

Automated Packaging

Automated Packaging Advantages

Significantly reduce the labor cost per package

Increase capacity to process more packages within the same square footage

Reduce the need for temporary labor assistance during peak periods

Doing more with fewer people

Hand Pack vs. Automated Order Fulfillment Options

Reduce Number of Associates

• Reassign/reallocate

• Reduce temp usage

• Lower labor cost/piece

Fewer People to Manage

• Lower costs for: • Absenteeism • Scheduling conflicts • Vacation coverage • Worker’s comp • Benefits

• Enables you to hire more qualified persons and pay at higher rates

Corrugated Packaging?

E-Pack with Carton Erection

E-Pack with Carton Erection

Order Processing System with Carton Erection

Order Processing System with Carton Erection

Ship Product. Not Air.

1. FACT. Products sold through e-commerce ship in wastefully oversize boxes that are on average 30-50% too big!

2. The recent shipping industry modification to the Dimensional Weight Formula has INCREASED these shipping costs by 17%, making right sized packaging even more important than before.

3. “Box on demand” options help you turn your boxes into right sized cartons thereby reducing the volume of corrugate you use and helping to eliminate fill void fill material.

4. Smaller box, bigger payoff…..

How to Reduce the Shipment of Air?

The only way to reduce the amount of unnecessary space around a product is to put it into a Better Fitting Package.

The Higher the number of Carton Sizes available to use in the packing system the better chance of an Excellent Fit

Simply put, More Sizes - Less Air!

In-House Box-Making Systems: Cost Reduction Technology

Impacts the following Variable Cost Factors: 1. Ground and Air Parcel Shipping Costs (DIM

Weight) 2. Box materials – inventory, box cost, etc. 3. Protective Materials 4. Void Fill 5. Labor 6. Product damage

What’s New In Automated Packaging?

PolyBubble AutoPacker System

The PolyBubble AutoPacker-V2

Reduces costs and waste Improves efficiency and

accuracy Easy-to-maintain Adjusts to variable or fixed-

size packages

The PolyBubble AutoPacker creates ready-to-ship packaging, specific to

your packages’ unique length

Key Features Automatic feed-to-

length for variably-sized packages

Low-Temp Sealing

technology with low

maintenance requirements

High-resolution

HMI (Human Machine Interface) with color

touch screen

Best-in-class component parts, including Allen

Bradley Mircrologix 1400 Series PLC and

Festo cylinders

Heavy-duty steel frame, mounted on

casters for easy mobility

Benefits

Increase your efficiency and accuracy Creates 8 to 14 packages per minute,

significantly faster than hand packing Print and Apply labeling option 1-to-1 scanning option Save costs and reduce waste Reduce environmental impact Bag length adjusts to the size of the

package, reducing waste from oversized bags

Low-Temp Sealing technology reduces seal blade wear and replacement needs

Optimizes shipping costs Easy-to-use and ergonomically

designed

Automated PolyBagging Systems for Pre-Pack

Clear/Clear

Clear/White

Automated Pre-Pack System

Automated PolyBagging Systems for Order Fulfillment

Standard White/Silver PolyBag

BioFlow

2-Way PolyBag

SX TableTop Bagger

The SX prints and indexes the bag in one step thereby eliminating bag waste and queuing

The next bag out print technology ensures that the correct address gets on the correct order

Shipping information printed directly on the outside of the polybag and eliminates label

Will run up to 9” x 16” polybag with 3.4” pass through

Runs 8 – 12 packages per minute = about 400 – 600 per 50 minute hour

SX Mobile Packing Station

MAX 20 PolyBagger

Versatile, field proven, flexible wide polybagger system

The MAX 20 prints and indexes the bag in one step thereby eliminating bag waste and queuing

The next bag out print technology ensures that the correct address gets on the correct order

Shipping information printed directly on the outside of the polybag and eliminates label

Will run up to 20” x 30” polybag with 6” pass through

Runs 8 – 12 packages per minute = about 400 – 600 per 50 minute hour depending on items to be packed. The packing process and data transfer

Hand Pack to PolyBagger

Picked cart to PolyBagger

Tote Conveyor to PolyBagger

Tilt Tray Sorter to PolyBagger

Automated COLD FUSION Systems for Order Fulfillment

Ten-Tuff Single Face Corrugate

Ten-Tuff WaveFlute

White/Brown Cohesive Corrugate

Ten-Tuff LinerBoard

COLD FUSION Packaging System

SP900 – Web Driven Product

SP9000 – Table Driven Product

SP900 Manual Label Feed

SP900 Auto Label Application

SP9000 (Scan, Print and Apply Label)

SP9000 – COLD FUSION Packaging System

SP900-600 3D Style System

SP900-600 3D Style System

Continuous Feed Flat Box 3D style

Continuous Feed Flat Box 3D style

Thank you