Innovative Parcel Optimization
Parts distributor struggles with an abundance of SKUs and inefficient packaging. IQpack helped realize 53% savings on material cost and 78% reduction in pack SKUs with package rightsizing.
This customer had multiple large, high volume, and high SKU service parts distribution operations. They were being challenged to reduce their package sizes in the final pack area in outbound. They were shipping too much air and using a lot of dunnage. Damage rates were also alarming because the existing method allowed for too much product movement in the packs. The current pack methods were antiquated and labor-intensive. Many decisions were left up to individual packers, leading to inconsistencies. We also needed to reduce packer movement and simplify the number of choices in their process (16 carton sizes, 2 void fill options).
IQpack worked with film and converting partners to develop a shrink shipping bag that was tough and elastic to handle rigors of shipping, transparent to allow scanning of the shipping label through the film, and shrinkable to draw down tight on the primary parts/packages for reduced internal movement.
We also integrated a tape strip at the opening to make bag closure quick and simple. All packs were standardized and consolidated into four shrink bag sizes. Finally, we worked strategically with an equipment partner to provide a heat tunnel system to draw the bag down tight to the products.
IQpack’s shrink bag solution completely eliminated the need for the existing corrugated shipping containers, tape, and the internal airbag void fillers.
The operation saw an ancillary reduction in product damage, a dimensional weight shipping savings of $370,000 per year, and realized a 6-week payback on the project.