Strategic sourcing for packaging
Companies frequently overlook the substantial savings opportunities that strategic sourcing can provide in the packaging and shipping suppliers category
A product’s success is greatly influenced by the appeal of its commercial or consumer packaging. But even before your product gets it front of the customer at the store, packaging is also integral to the transportation, storage, and handling of your product. Despite its importance to both the product’s appeal and transportation, packaging is a category that goes unmanaged. From protective, flexible, and custom packaging to kraft corrugated boxes, bubble wrap, stretch film, flexible laminates, and blister packs, Corcentric’s strategic sourcing services can help your organization reduce costs, increase quality, and improve lead times for its packaging requirements.
At Corcentric, we start our strategic sourcing process for packaging by understanding and adapting to your organizational structure and culture. Our strategic sourcing team then makes sure we understand the specifics of your organization’s packaging requirements across internal departments to ensure our efforts will produce the optimal mix of products and suppliers at the lowest possible price. These packaging specifics include labeling, typical order volume and run size, average lead times, packaging material specifications, and environmental specifications.
Once our strategic sourcing team understands your organization’s product packaging needs and practices, we comb the market to identify quality, best-fit suppliers most capable of fulfilling the packaging needs set forth by your stakeholders. We compare these product packaging suppliers against one another to determine which meet your specific packaging requirements most effectively, then work with you to identify the best-fit supplier. Once a best-fit packaging supplier, or suppliers, are identified, our strategic sourcing team leverages our proprietary market intelligence and deep understanding of pricing fluctuations of the raw materials used in the manufacture of packaging materials – such as pulp and paper, petrochemical resins, and crude oil – to lock in the best price points available, or tie pricing to the applicable index to ensure the best pricing model possible.
In addition to our strategic sourcing team’s subject matter expertise concerning raw material costs, our experts also review your product packaging materials spend in a comprehensive way to develop a holistic overview, which we then utilize to optimize your entire product packaging supply chain, driving consolidation and leveraging total volume with suppliers. This supply chain optimization service ensures that you will receive not only immediate cost reductions but long-term stability while streamlining your current supply chain operations.
Corcentric’s strategic sourcing initiatives identify savings within your product packaging supply chains by:
- Establishing proper reorder points
- Leveraging overall packaging material spend
- Consolidating packaging suppliers
- Establishing index-based price points
- Determining optimal run sizes for packaging production
- Implementing waste reduction strategies
- Negotiating with suppliers with a full understanding of market rates
- Developing annual tiered rebates with packaging suppliers
- Developing tiered pricing models based on run rate efficiency
- Reducing lead times
- Implementing VMI programs
Corcentric’s strategic sourcing services give you access to experienced procurement and sourcing resources that help you evaluate and optimize your current packaging supply chain. Our packaging sourcing team works with you to identify consolidation opportunities, leverage overall volume, and establish contracts or pricing agreements to lock in competitive pricing and realize long-term savings without compromising product quality or supplier service levels. Contact one of our strategic sourcing experts today to get started on reducing your product packaging costs.
Case study
Corrugated savings
Corcentric’s client was a global manufacturer of steel products with a product line requiring specialized protective packaging. The current supplier of these packaging products had been hesitant to provide pricing transparency or negotiate, and the steel manufacturer asked Corcentric’s strategic sourcing experts to identify quality alternatives in the market.
Corcentric’s strategic sourcing team interviewed numerous stakeholders involved in the packaging selection process, gathered all the client’s product packaging requirements and specifications, and collected copies of all agreements and contracts with the present supplier. Our sourcing team then took the packaging specs to market and identified several alternative packaging suppliers capable of producing the same materials at considerable savings. The steel manufacturer reviewed the identified suppliers but preferred to preserve its existing supplier relationship. Our strategic sourcing team then took the savings identified in the market to the incumbent supplier and secured savings and a favorable agreement for the client.
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