A new study by SourceHUB, provider of a collaborative technology platform for packaging procurement, found that automating specifications and artwork processes in the packaging procurement process can result in key efficiency gains as up to as much as 30%.
The SourceHUB Cost Analysis Study was undertaken by MPK International’s packaging unit, a consulting service provider specializing in enabling clients to develop and manage international supply chains. The study also found that automation frees up employees from change management, allowing them to work on more strategic tasks such as developing suppliers, supporting sales and marketing. The study also claims that automation delivers a shorter product development and launch cycle, resulting in increased revenue opportunities.
The study was based on a model of a single potato chip category. This model category has $60 million in annual sales, and 50 SKUs across four sub-categories. Procurement for the category is managed by a 12-person, cross-functional team. The study focused on how automation reduces the time it takes to complete each change of packaging. The 30% time savings means that the team in the model saves 2,555 hours every year working on changes, for an annual cost savings of $112,413, which in this model netted the 30 per cent increase in efficiencies.
“Just about every industry out there has implemented automation tools to improve efficiency, cut costs and drive better service to customers,” said John Moran, CEO of SourceHUB. “We commissioned MPK International to perform this analysis to demonstrate how effective automation can be in the packaging ecosystem.”
“We are in a unique position with our customers to see ways processes in packaging can be improved,” said Mike Carpenter, Managing Partner of MPK International’s packaging unit. “That’s why we did this cost analysis. It is hard to convince the packaging industry of this fact and break the bonds of the status quo. We are hoping that industry professionals will at least listen to how automation can change all of this and the packaging industry can take some big strides forward.”
For more on the SourceHUB Cost Analysis Study or to obtain a copy, visit SourceHUB.