Packaging on Demand: A Way to Increase Sustainability and Reduce Costs in the Shipping Business

The pandemic has accelerated the shift from physical retail to e-commerce, creating massive growth in shipping volumes. This expansion has highlighted the need for innovative packaging solutions -- particularly packaging on demand systems that can optimize both sustainability and operational costs.

What Is Packaging on Demand?

Packaging on demand involves manufacturing outer packaging at the dispatch point within a company's facility. The key advantage is individualized control over carton quantity and dimensions. The central component is a carton cutting machine (box-on-demand machine) that scores, perforates, and cuts continuous corrugated board to exact specifications, producing custom shipping boxes from blanks.

These systems can be enhanced with supplementary equipment including carton erectors, sealers, conveyor systems, and scanning stations to streamline the entire packaging workflow.

Advantages for Distribution

The benefits extend across the entire supply chain:

• Filler material decreases by up to half through right-sized packaging
• Shipping costs reduce by up to 30% through smaller, optimized box dimensions
• Optimal material utilization minimizes waste
• Significant warehouse space savings compared to storing pre-folded standard cartons

Advantages for Recipients

Customers also benefit directly from right-sized packaging:

• Reduced cardboard and filler waste from appropriately-sized packaging
• Lower damage rates due to custom-fitted boxes
• Enhanced unboxing experience
• Increased customer satisfaction regarding environmental responsibility

When Is Investment Worthwhile?

Packaging on demand makes the most sense for online retailers with high shipping volumes, product manufacturers with significant individual shipments, and fulfillment service providers. Key cost considerations include material expenses, shipping fees, storage requirements, staff retention, and ongoing operational expenses.

Choosing the Right Provider

When evaluating packaging-on-demand providers, consider these critical factors:

1. Equipment flexibility across different sizes and product types
2. System integration -- ability to construct and install suitable peripheral equipment
3. Machine quality and durability under continuous mechanical stress
4. Transparent cost projections over multiple years
5. Avoidance of lock-in -- no long-term cardboard purchase commitments at inflated prices

Successful adoption requires selecting high-quality systems from providers capable of customizing solutions to specific operational needs. Organizations should develop comprehensive profitability analyses covering both equipment and material processing costs over several years before committing.

Guest post by Horstmann Maschinenbau.