How Contract Packaging Can Optimize Your Supply Chain

Outsourcing certain aspects of your business can be incredibly beneficial, especially if you are struggling to find a sustainable balance. There are companies that specialize in specific areas for a reason, and businesses can rely on their expertise to successfully perform standard processes, like optimizing the supply chain.

One such service that businesses choose to use is contract packaging. While it might be easy enough to organize your products, it can be costly to store items that are sitting on shelves in easy-to-open and efficient packages. If you are considering a contract packaging service, this post should help you decide.

What is Contract Packaging?

Contract packaging, otherwise known as co-packing, is a service where a business outsources the assembly, packing, and labelling of its products to a third-party. This specialized third-party company is often referred to as a contract packager. Outsourcing in this way allows manufacturers to focus on their core competencies and reap other benefits, like access to expert facilities and reduced costs.

Companies will gain access to numerous services offered by contract packagers, ranging from basic bag and pouch filling to shrink-wrapping and production of packaging materials.

Three Ways Contract Packaging Can Optimize Your Supply Chain

With a better understanding of what contract packaging is, you can now learn how this service can be used to optimize your business’ supply chain.

Increase Flexibility and Scalability

One of the primary benefits of using contract packaging to streamline a supply chain is the ability to adapt to seasonal demand. Contract packagers help businesses respond to fluctuating demand by increasing production capacity. This occurs without altering business’ internal infrastructure, as you will not be stuck with unused capacity when demand slows.

Helping with flexibility also means that the third-party service supports new products and promotions. Co-packers will efficiently handle limited-edition product launches and special promotional packaging. They achieve this by quickly adapting packaging lines to handle new bundle configurations, designs, and/or sizes.

Streamline Logistics and Warehousing

While contract packaging does mainly impact the supply chain, many co-packers offer integrated services that simplify the entire logistics chain. Some providers even offer a full suite of services, including distribution, inventory management, and warehousing. This helps centralize your company’s operations, improve efficiency, and simplify logistics.

Your business will experience reduced costs because of this, too. Contract packaging experts can optimize packaging design and dimensions to minimize shipping costs; carriers typically calculate fees based on dimensional weight. With their knowledge of the market, co-packers can also advise on consolidating shipments, which can significantly lower transportation costs.

Leverage Specialized Expertise

Business owners will have less to worry about by partnering with contract packagers who have expert knowledge, allowing them to focus on other activities. These experienced companies and their services, like Ryder and its contract packaging and manufacturing solutions, understand the best practices for the supply chain as well as current packaging trends and technologies.

Not only that, but this experience will ensure compliance with the strict quality and safety regulations of your sector. Many co-packers choose to focus on specific industries, such as cosmetics or food and beverage, and this knowledge guarantees your business will stay up-to-date with evolving regulations.

To conclude, a supply chain must run smoothly to ensure business success and customer satisfaction. One way to do this is using the contract packaging service, and this post has explained just how this helps.