Company Spotlight: Macfarlane Packaging

Founder: The late Lord Macfarlane

Established: 1947

Headquarters: Glasgow, Scotland

Customers: The company has 20,000+ customers in the UK and Europe including Dunelm, ASOS, Ikea, Lakeland, Currys, O2, Halfords, Whittards, The Body Shop, Games Workshop, Urban Outfitters.

No. of employees: Macfarlane Group employs over 1,000 people at multiple sites, principally in the UK and Ireland.

Website: https://www.macfarlanepackaging.com/

www.macfarlanepackaging.com/optimiser

Rachel Fellows – Director for Retail and 3PL, Macfarlane Packaging:

“Macfarlane Packaging is the UK’s largest distributor of protective packaging products and services in the UK and Ireland. We serve over 20,000 businesses, with a focus on reducing packaging costs and supporting them with packaging solutions that support their sustainability goals.”

Tell us about Macfarlane Packaging and the company’s USPs?

Macfarlane Packaging is the UK’s largest packaging distributor. We provide retailers and other businesses with innovative packaging materials and services that help them drive down costs, improve operational performance and enhance customer experience, while assisting them to build packing operations/supply chains that are resilient, efficient, and sustainable.

What services do you offer an online retailer?

In the age of online shopping, packaging is a must-have for ecommerce and multichannel retailers who want to make sure goods arrive to consumers safely, while leaving a positive impression.. However, packaging is much more than just a commodity.

At Macfarlane we understand the need for ecommerce product and sector expertise, transactional simplicity and instant access to data, single source supply for improved control, and the need for innovation to differentiate in a highly competitive market. Our retail packaging solutions and services are geared towards this

We develop packaging that delivers memorable unboxing experiences, whilst helping retailers and their third-party logistics partners balance supply chain challenges such as process improvement, sustainability, and damage reduction, and keeping costs down. Our retail customers can expect independent and impartial design expertise, balanced information about packaging and the environment, as well as geographical coverage for stock holding and deliveries to support the challenges of space and unpredictable volumes.

How do you deliver memorable unboxing experiences?

Our Innovation Lab helps businesses find the best packaging solution through industry leading design and testing equipment. It’s an immersive experience where we solve packaging problems quickly in one place, bring to life packaging solutions through 3D design, HoloLens augmented reality technology and on-site production quality print finish sampling.

We’ve also just launched a new tool called the Packaging Optimiser. This interactive platform can show retailers exactly how the right packaging can help reduce their costs and cut CO2 emissions from their operation. It looks at key areas throughout a supply chain that packaging can influence – such as transport, damages & returns, storage and even productivity. For example, the Packaging Optimiser could illustrate how investing in packaging automation could help tackle labour shortages or cut the need for temporary labour during peak times or even compare packaging materials to see which one will work most effectively for a retailer.

What is Macfarlane’s vision and purpose?

Our purpose is to protect what matters: businesses and their goods, the people we work with and for, and the planet we share.

Which retailers do you work with?

We work with a wide range of retailers from small businesses through to national omnichannel companies. Our customers include Dunelm, ASOS, Ikea, Lakeland, Currys, O2, Halfords, Whittards, The Body Shop, Games Workshop, Urban Outfitters.

Tell us about the growth of the business, what have been the main areas of expansion and what has been key to your success?

Macfarlane Packaging recently celebrated 70 years in business. The key to this success has been building long-term strategic relationships with our customers and making sure we always put our customers at the heart of everything we do, understanding their aspirational needs and delivering on these.

Working with internet and multichannel retailers during the early stages of ecommerce has enabled us to tailor packaging products and services to this market and grow alongside it. We’re a value driven business – everything we do is designed to drive down operational costs and improve performance for our customers, so that they have resilient, efficient, and sustainable operations. his has been particularly relevant during the pandemic, when retailers saw unprecedented demand and were challenged with delivering under exceptional circumstances.

What challenges are you addressing for multichannel retailers who aim to meet peak season demands?

Packaging automation can be a game-changer when it comes to boosting throughput, controlling material use and lowering supply chain costs. Using automated packaging systems can help retailers tackle labour shortages and minimise the amount of temporary labour needed during peak periods. This is also particularly relevant given the UK’s current labour shortage.

We’re seeing more major retailers choose third-party logistics (3PL) to cope with the challenges of fulfilment too. To support this, we work with retailers and their logistics companies to optimise their warehouse and pack room layouts to ensure they can cope with seasonal demand and future-proof their operations. This can involve everything from designing new packing stations to even providing advice about the packing process itself.

The team at Macfarlane Packaging have also been working hard to make sure our packaging sourcing and supply is robust, so that we can ensure retailers have the packaging they need year-round. Our stock holding across 28 Regional Distribution Centres and inventory management services, next day deliveries 7 days a week (including delivering outside the 9am – 5pm hours), as well as our online packaging order management system are examples of how we’re helping businesses prep for peak throughout the year.

How are you using emerging technology to support your retail customers?

We’re always looking for new ways to support retailers as they grow. For us, this means investing in new technology and tools that help us deliver for retailers. A recent example of this is upgrading our Warehouse Management System. The new functionality will enable us to auto-replenish stock in line with customer use – this will be particularly beneficial for our retail customers as they grow, as we can readily ensure continuity of supply.

Another example is adding the latest tech to the Macfarlane Packaging Innovation Lab, recent additions include virtual prototyping and industry standard testing equipment – so we can make sure retailers’ packaging will perform properly. Our Innovation Lab team is also well prepared to help retailers take advantage of connected packaging technologies like augmented reality, that can help create a competitive edge and really differentiate a retailer’s unboxing experience.

The Macfarlane team are also aware that with growth comes the need to scale up and improve productivity, while focusing on controlling costs to maintain profitability. This is where our new interactive Packaging Optimiser tool can be key – as it can help retailers assess the true cost of their packaging throughout the supply chain.

What are the challenges for ecommerce/ multichannel retailers and suppliers over the coming years? How are you preparing to meet these challenges?

One of the biggest challenges for internet and multichannel retailers and suppliers is the rise of eco-conscious consumers and the demand for sustainability. Our recent annual unboxing survey revealed almost 1 in 5 consumers won’t buy from retailers who don’t use sustainable packaging and we expect this number to grow.

We’re already working to address this challenge in different ways:

1)We’re actively sourcing more sustainable packaging products that are either recyclable, reusable and contain recycled content or are made from renewable materials. As part of this, we have an initiative to standardise recycling labelling on our own-brand packaging and make sure we offer retailers all the information they need to make informed choices about their packaging.

2)We are continually implementing programmes (like using only renewable electricity at our sites) to reduce our own emissions. Due to these initiatives, retailers can have confidence that our products and operations support their own sustainability goals.

3)We’re working with retailers to look at how they can reduce the amount of packaging material they use while still protecting their products. Critically, Macfarlane Packaging is also partnering with retailers to use packaging optimisation to help them lower CO2 emissions from their supply chains.

As demand for online shopping continues to grow, it will be challenging for retailers to create a fulfilling digital customer experience that compares to an in-store experience. Packaging will play an important role in tackling this challenge. The unboxing experience represents a significant milestone in the customer journey and enables retailers to make a connection with customers that inspires brand loyalty. Our investment in our Innovation Lab is one of the ways we’re preparing to help retailers meet this challenge. We’re also investing in state-of-the-art warehousing systems and distribution centres, so our capacity is future-proofed to cope with the growth in the retail market, to ensure continuity of supply even in the most demanding periods.

Case study

Supporting Dunelm with its plastic packaging pledge.

We have been working closely with Dunelm, a leading high street and ecommerce retailer of homeware, who is committed to a Net Zero Pathway strategy.

Launching its plastic packaging pledge in May 2021, we are helping the company to reduce the amount of plastic packaging it uses through a programme of material switches to recycled content, recyclable material and, where possible, alternative materials.

One example of the projects we have in place to support this pledge is the increase of recycled content material in Dunelm’s mailing bag range. Already containing 30% recycled content, we helped Dunelm increase this to 95%. They are also 100% recyclable.

The impact of this change has removed 68 tonnes of virgin plastic material from the Dunelm operation, impacting a material manufacturing reduction of over 129 tonnes of CO2. That’s the equivalent of 324,783 miles driven by an average passenger vehicle.

Not only that, the new print design on a white background also uses 70% less ink.

We continue to work with Dunelm on further innovations to improve sustainability and reduce its material use.

Gillian Cross, Technical Packaging Manager of Quality and Sourcing said: “The support that Macfarlane Packaging are providing is helping us to work towards, and achieve, our ambitious sustainability targets.”

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