Outsourcing Secondary Packaging Trends

Increased flexiblity and lower costs are increasing outsourcing

Increased flexibility and reduced costs are the two top reasons why manufacturers are outsourcing their secondary packaging services, according to a new study. The 2009 Secondary Packaging Outsourcing Report, sponsored by third-party logistics company Saddle Creek Corp. and Contract Packaging magazine, explores these benefits as well as common practices and emerging trends in the outsourcing of secondary packaging.

The research is based on responses from nearly 500 online survey participants, more than 200 of whom outsource secondary packaging services such as assembly, fulfillment, cartoning, point-of-purchase displays and bundling.

Research highlights include:

  • Nearly half (41.1%) of respondents outsource some or all of their secondary packaging services.
  • A significant number of these companies (34.6%) outsource 75%-100% of their secondary packaging services.
  • A quarter of respondents (24.4%) who already outsource expect to increase their outsourcing of secondary packaging "somewhat" or "substantially" in the next 12 to 18 months. Roughly half (53.7%) expect their level of outsourcing to stay the same.
  • "Increased flexibility" (64.5%) and "reduced costs" (62.1%) are viewed as the top two benefits of outsourcing by respondents who currently outsource.
  • Roughly a third of respondents who outsource feel it would be "valuable" or "very valuable" if their provider offered integrated logistics services such as warehousing, distribution, and transportation as part of the packaging service offering.

"Manufacturers are recognizing the value of outsourcing their secondary packaging services in order to move products to market as efficiently and cost-effectively as possible," said Robert Pericht, senior vice president of warehouse operations at Saddle Creek. "The research confirms what our customers have seen firsthand -- a strategic decision to outsource can make a significant impact on supply chain efficiency."

To view the report visit to www.saddlecrk.com/pkg.

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