Survey: contract packagers evaluating e-commerce opportunities

New survey shows the majority of CP/CMs are dabbling their toes in the e-commerce waters, concentrating their efforts on improving their warehouse processes and operational efficiency.

According to Think Inside the Box, a recent study on e-commerce published by PMMI’s Business Intelligence, 61.9% of contract packagers/contract manufacturers surveyed are “somewhat active in e-commerce,” while 4.8% are “very active in e-commerce”—a greater number than anecdotal evidence might suggest. For those exploring this new opportunity, distribution/logistics—in particular return logistics—appears to be the greatest area of interest. Responding to the question, “Enterprise wide, what are the TOP TWO areas where you are concentrating your e-commerce efforts and budget?” 60% said “improve warehouse processes/operational efficiency,” followed by 40% who said, “adding automation/equipment.”

Among the other results:

When asked, “What are the top two factors in secondary package material/design selection, specific to e-commerce?”:

  • 45 said fulfillment velocity/ability to increase yield
  • 40% said end consumer/unboxing experience
  • 35% said minimizing footprint needed for warehouse storage
  • 30% said protective value
  • 25% said desire to optimize freight weight

When asked, “What best describes the secondary packaging you use for e-commerce applications?”:

  • 55% said corrugated
  • 30% said shrink wrap
  • 15% said pouch (including bubble pouch)

When asked, “What best describes your plant for primary packaging in e-commerce?”:

  • 35% said, “We will develop a new primary package (size, design, or material) for both retail and e-commerce (omni-channel package design)”
  • 45% said, “We will not make any changes to our current primary packaging”
  • 15% said other
  • 5% said, “We will develop a new primary package (size, design, or material) for e-commerce channel”

When asked, “What are the top two biggest problems you experience with e-commerce freight and delivery?”:

  • 50% said damaged product
  • 40% said delivery carrier management
  • 40% said delivery delays
  • 20% said return logistics
  • 15% said loss/theft
  • 15% said other
  • 10% said, “We don’t have problems”

Methodology

In a series of online studies conducted in January and February 2019, Contract Packaging magazine sister publication Packaging World asked its online readership about their approach to e-commerce. There were 297 responses, 21 of which were contract packagers/contract manufacturers. See results from the full study here.

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