Packaging experts help manufacturers cut costs

Ranch Hand Truck Accessories, a large producer of heavy-duty truck and SUV accessories, was having a great year: double-digit sales growth accompanied by strong consumer demand for its products. But as revenue went up, so did the number of freight returns. “We had a packaging problem that was costing us a lot of time and money,” says Greg Chumchal, Ranch Hand's general manager. The company needed a better way to protect its products, such as grille guards and front bumper replacements, during shipping. Grille guards are bulky; they weigh 130 lb and must be shipped six to a pallet, because it's too expensive to ship them individually. Chumchal turned to Bobby Strauss, a San Antonio-based xpedx (www.xpedx.com) packaging specialist, for help. Xpedx is a fast-growing distributor of packaging supplies and equipment, with 350 packaging reps and equipment specialists at more than 100 locations in the U.S. and Mexico. Xpedx works with manufacturers to help them reduce costs, as well as improve productivity and quality across the production line, in packaging operations/design and logistics/distribution. Strauss visited Ranch Hand's 100,000-sq-ft manufacturing facility in Shiner, TX, and met with management to assess the situation. He recommended that Ranch Hand take a look at an innovative protective packaging technology from Sealed Air Corp. (www.sealedair.com) called Instapak® Foam-in-Place.

Strauss arranged for grille guards to be sent to Sealed Air's lab, where technicians created several prototypes to better protect the grille guards and bumper replacements during shipping. Ranch Hand selected Sealed Air's GFlex® pads, which lock on and bend around the grille guard's wings and uprights to protect them from damage. Creative use of GFlex custom foam pads also create more stability for products nested on pallets during shipping. Strauss presented a customized xpedx analysis that documented how the projected reduction in freight damage would not only cover the cost of the Foam-in-Place technology, but would also generate a first-year savings of tens of thousands of dollars. Ranch Hand, impressed with the strong ROI, signed off on the plan.

Since implementation, freight returns have dropped 80 percent, and the company is looking to replicate its success with the grille guards on other products. Chumchal says he is very pleased with the outcome. “It not only saved us many thousands of dollars, but it also significantly improved quality and customer satisfaction, which is invaluable,” he says. “If it weren't for xpedx and Bobby Strauss, we would have never known about this concept. When it comes to packaging, there are a lot more options out there than there were five years ago. So, it's a big plus for us to have a resource like xpedx we can rely on to keep us up to speed.”

Reduced freight damage not only covered the cost of the foam-in-place technology, but it also generated a first-year savings of tens of thousands of dollars.

Strauss says Ranch Hand's story underscores the value xpedx brings to manufacturers. “What we bring to the table is not just one solution, but the best solution for the customer's specific needs and its business,” he says. “We're constantly learning about new products, equipment and materials from scores of vendors, and we're able to bring that expertise into focus for our customers.”

Xpedx calls the process of assessing a customer's operations “Co:Re,” which is pronounced “core” and stands for “where contribution meets results.” The five-step process is an in-depth analysis of a manufacturer's packaging operations with a focus on bottom-line savings, says Mark Matthews, vp of the xpedx packaging business. “It's all about helping our customers develop and implement cost-effective and truly innovative solutions,” he says.

Xpedx-led solutions run the gamut from efficiency-driven process improvements to supply-chain management to contract packaging and the use of new materials and equipment. Matthews notes that one xpedx customer, a global consumer-products company, was able to save $1 million/year with a single process improvement. “The potential to deliver new efficiencies and take costs out of production is significant,” he says.

In light of these competitive pressures, many manufacturers are focusing on their core competencies and turning to strategic partners like xpedx for expertise in areas like packaging and logistics. “The drumbeat of 'faster, cheaper, better' isn't going away,” says Matthews. “Manufacturers know that, and they're developing business strategies to deal with it.”