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GUEST COMMENT Packaging is a puzzle: Technology can help solve it

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In the fast-paced and competitive world of ecommerce, where every click results in a parcel being prepared for shipment, the packaging puzzle has become increasingly pressing, writes Wing Chan, co-founder of Sourceful.

Wing Chan, co-founder Sourceful

When I first started out in ecommerce, generic one-size-fits-all mailer boxes were the simplest solution. Solutions like this are no longer acceptable. Brands need packaging that tells their story and communicates their values. Consumers now expect to open packages that are smartly designed, beautiful looking and more sustainable.

Whether you’re a small business with a limited budget, or a big business with a wide range of inventory, meeting all of these criteria can be a conundrum – how do you balance sustainability, aesthetics and efficiency in your packaging?

We have conducted an extensive research exercise, gathering insights from 280 direct-to-consumer businesses, to understand the current landscape and the pressing issues within the packaging supply chain.

Our study – Solving the Packaging Puzzle – revealed that ecommerce firms are investing heavily in packaging, with some spending more than £1mn on packaging annually. This substantial investment can involve nearly one-sixth of their workforce. It’s no surprise that 40% of businesses are actively seeking ways to optimise packaging efficiency and cost-effectiveness.

But the road to sustainable packaging is filled with challenges and complexities.

What’s striking is that nearly half of the surveyed businesses have made reducing packaging waste and increasing sustainability their top priority. It’s clear that consumer demand for more sustainable materials is reshaping the industry, and businesses are taking notice.

Furthermore, a third of ecommerce companies recognise the importance of strengthening relationships with their suppliers, who play a pivotal role in sustainable decision-making within the businesses. This underscores the growing significance of collaboration within the industry.

Our research highlights the reasons Sourceful was created in the first place. The packaging supply chains are outdated, cumbersome, and inefficient. They are in dire need of technological modernisation to reduce waste. Over half of ecommerce start-ups believe that the packaging supply chain is old-fashioned, and many businesses are frustrated with the lengthy design and prototyping process.

The consequences of this inefficiency are significant, with one in four packaging shipments arriving late, and one in ten shipments containing damaged or substandard packaging. These delays and poor-quality products result in an estimated £150,000 of wastage each year for the average e-commerce business.

The good news is that the industry recognizes the need for change, and a technological transformation is on the horizon. A staggering 71% of businesses are planning to invest in tech solutions to enhance their packaging operations. Artificial Intelligence (AI) is expected to play a pivotal role, with 47% of firms anticipating its use in demand forecasting, particularly during promotional events and peak seasons.

Real-time shipment tracking, automated fulfilment, and other technologies are seen as potential solutions to address logistics issues and inventory management. The packaging supply chain is on the brink of a revolution, and businesses are gearing up for the change.

The future of packaging lies in AI and cutting-edge technologies. Innovations such as NVIDIA’s investments in graphics technology are making visual media more lifelike and cost-effective. Sourceful’s own Spring AI continues to evolve, simplifying the design process by facilitating the use of actual brand assets, accelerating ideation.

As we work to solve the packaging puzzle, making the process more efficient, sustainable, and user-friendly for all businesses, we invite you to join us on this journey towards a more sustainable future.

The future of packaging is now, and it’s sustainable, efficient, and technology-driven. Together, we can solve the packaging puzzle.

Together we can solve the puzzle of packaging and reach a solution that is efficient, more sustainable and looks and feels great when that shipment arrives in a customer’s hands.

Wing Chan, co-founder of Sourceful

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