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Ecommerce/Supply Chain

Amazon Spurs More Brands Toward Frustration-Free Packaging

Amazon has expanded its Frustration-Free Packaging incentive program to millions of “Sort” items. That means packages weighing between 5 and 20 pounds, with dimensions between 6 x 4 x 0.375 inches and 18 x 14 x 8 inches.
Through new financial incentives under its Frustration-Free Packaging program, Amazon encourages thousands of additional brands to develop millions of packages for efficient ecommerce delivery and sustainability.

On June 1, 2021, Amazon announced an expansion of its Frustration-Free Packaging (FFP) incentive program to include millions of additional products that the ecommerce giant is asking to be supplied in packaging designed for efficient ecommerce distribution.

Thousands of new vendors will have to decide whether or not to develop packaging specifically for ecommerce. Will easing packaging frustration for consumers cause more or less frustration for packaging designers? In the short term, maybe more. But, in the long run, the overall benefits for brands that opt in may help them surpass the competition as they:

• Enhance brand equity by meeting consumers’ requests for less packaging.
• Contribute to their own sustainability goals.
• Lower packaging and inbound transportation costs.
• Lower damage rates and returns.

Vincent Barral, principal, Frustration Free Packaging, Customer Packaging Experience, at Amazon, says, “As a founding member of The Climate Pledge, we are advancing toward our commitment to be net zero carbon emissions by 2040, 10 years ahead of the Paris Agreement. As part of this goal, we are expanding our FFP partnerships with vendors to more shipments. We want to grow the proportion of shipments that are easy to open, 100% recyclable, and that Amazon can ship without the need for additional protective packaging. We are customer obsessed, and know our customers expect us to reduce packaging waste.”

Amazon’s Frustration-Free Packaging incentive program started in 2018 with Durable Goods, Consumables and Soft Goods larger than 18x14x8 inches or 20 pounds or more that are sold and fulfilled by Amazon. The ecommerce giant defines these larger products as “Non-Sort” items.

Amazon now expands the Frustration-Free Packaging incentive program to smaller “Sort” items, specifically the largest-sized sortable products — 6 x 4 x 0.375 inches and larger, but equal or smaller than 18 x 14 x 8 inches and less than 20 pounds. This includes books, toys, stuffed animals, beauty products, kitchen utensils, and more.

Thousands of vendors and millions of products are now eligible.

“The expanded FFP incentive program will increase the proportion of FFP shipments. And it will reduce the proportion of shipments in traditional brick-and-mortar retail packaging that is oversized to appeal to consumers on store shelves, and not robust enough to protect products shipped through the small-parcel direct-to-consumer supply chain,” Barral says.

Another example would be a product shipping in a box when it might only require a flexible package. “Our certifications seek to eliminate as much packaging material as possible,” Barral says, while still and optimizing product protection and reducing damages. “Expanding our certification eligibility beyond a corrugated box to include bags and paperboard mailers will allow more ASINs to be certified as SIOC.”

 

Amazon Vincent Barral quote.jpg

The expansion starts in North America (as of June 1, 2021) and will extend to Europe later this year, specifically in France, Germany, Italy, Spain, and the United Kingdom.

This expanded FFP program offers incentives to vendors that convert to certified Frustration-Free Packaging for Sortable products shipped during the 15 months between October 2021 and December 2022. The incentives range from $0.08 to $6.49 per unit, depending on whether the package meets FFP requirements and reduces overall volume from the existing package size. A “unit” is called an ASIN, which stands for Amazon Standard Identification Number and is assigned by Amazon to uniquely identify a product within its massive catalog of products.

Amazon currently has a chargeback of $1.99 per unit for uncertified Frustration-Free Packaging Non-Sortable ASINS — and that chargeback for Non-Sortable ASINs will remain in place. However, Amazon is not expanding chargebacks to Sortable ASINs at this time.

Additionally, the 2018 FFP incentive program for Non-Sortable items offered a one-time early adopter credit on every unit to help with “transitions costs.” Amazon is currently not offering an early adopter credit for Sortable ASINs.

Barral says, “Upon FFP certification, vendors will avoid chargebacks and collect incentives. The expanded FFP program is designed to accelerate vendors’ conversion towards more sustainable packaging that delights our customers.”

 

How the expanded FFP incentive program works.

Vendors can earn incentives in any or all of these three ways:

1. By preparing products to ship without additional Amazon packaging by passing the ISTA 6A test and receiving a Ship in Own Container (SIOC) certification from Amazon (FFP Tier 2).

2. By redesigning their existing packaging to reduce the overall size.

3. By ensuring their packaging is fully recyclable and easy to open (FFP Tier 1).

According to the new incentive program, newly certified Frustration-Free Packaging that maintains or reduces volume will be eligible for incentives. Why will vendors be rewarded for maintaining the volume?

Barral explains: “Rewarding vendors for maintaining the current volume encourages them to avoid adding any additional packaging over time, and to transition to sustainable packaging. The FFP incentive includes three components: (1) Tier 2 certification ‘ship in own container,’ (2) cube reduction, and (3) Tier 1. Vendors of ASINs that maintain their cube will be eligible for the first component if their products don’t require additional Amazon packaging (SIOC); and the third component (Tier 1) if they are easy to open and composed of 100% recyclable packaging materials. Vendors of ASINs that maintain their cube will not be eligible for the second component of the incentive (cube reduction).”

The deadline for compliance in this new incentive program is as early as October 2021 and as late as December 2022. It’s up to the vendor to take advantage of how many months it will enjoy the incentives, depending on how soon it can change its packaging.

Photo supplied by Amazonffp-box-web.jpg

Smaller Sort items in Frustration-Free Packaging can ship by themselves. But when there are multiple items/products in a single shipment, those Sort items will still ship together to the same customer in an Amazon overbox.

 

Ensuring success.

“Since 2015, we’ve sent over 1.2 billion FFP shipments to our customers. More than two million products are already included in this program,” Barral says. “Based on the success of the program since 2018, we are significantly expanding the scope of the program to smaller sized products to accelerate FFP conversions throughout our network.”

What did Amazon learn from the 2018 FFP incentive program that has helped shape this expanded program? “We have learned that the resources that Amazon made available to vendors through our packaging programs directly drove FFP conversions successfully, accelerating the transformation to more sustainable packaging,” Barral says.

Those resources, newly updated for this expanded program, are:

• Amazon’s Frequently Asked Questions-Vendor Packaging Incentive document.

• Amazon’s website www.aboutamazon.com/packaging, which has information and resources in four areas: Design, Testing, Certification, and Case Studies. This will be the vendor’s primary resource, with enrollment documents, testing instructional videos, and examples for inspiration. The slideshow shows three such successful case studies.

APASS, the Amazon Packaging Support and Supplier network, that provides the knowledge and skills needed to convert to FFP.

• Testing labs certified by the International Safe Transit Association (ISTA). Or, if companies have their own packaging test labs, they can be trained in the Amazon test methods and do their own tests. The ISTA-6 test simulates the stress a package endures during the ecommerce supply chain.

“To certify SIOC and FFP packaging with Amazon, it must pass a physical performance test. If the product is not fragile or liquid, vendors can complete the self-testing drop sequence and submit passing test reports,” Barral says. “If the product is considered fragile (glass, ceramic, porcelain, clay, liquid, semi-liquid), the ISTA-6A test is required via the Amazon packaging lab or a third party lab to accurately simulate the journey of a package through the Amazon Fulfillment Network to protect customer experience.”

• Amazon’s new incentive calculator that lets vendors calculate the estimated incentive amount they are eligible to receive following their products’ FFP certification within the incentive payment timeline.

 

Goals of the FFP program.

Through its Frustration-Free Packaging program, Amazon has worked with vendors and packaging suppliers to optimize ecommerce packaging in three ways:

1. Improve the customer’s experience.
2. Minimize the environmental impact of packaging, which includes reducing the amount of packaging.
3. Lower the cost of delivering goods.

These are still the main goals of the FFP program.

From its start, Frustration-Free Packaging has been focused on delighting customers by reducing the packaging size and amount of materials,” says Barral. “Traditional retail requires packaging to be oversized so that products appeal more to customers while on display shelves. Unlike traditional retail, ecommerce does not require any excess packaging. Frustration-Free Packaging helps right-size packaging and utilize recyclable materials to further reduce our paper consumption.”

Thus, the FFP program highlights how ecommerce creates a unique opportunity for brands to eliminate what Amazon calls “curb appeal” packaging waste that’s inherent in selling products in a brick-and-mortar store.

Photo supplied by AmazonLenox-lean-packaging-hero-image-2-web.jpg

Over the years, Amazon has shared many success stories from brands that have switched to Frustration-Free Packaging. You can see some recent examples from Procter & Gamble’s Tide, Henkel, and Lenox in the slideshow.

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