There’s no getting around the fact that 2009 was a tough year for business. While prospects for a recovery look favorable, most experts believe economic improvement will progress slowly. That being the case, we are working hard to help our Arizona customers find smart ways to reduce packaging costs. In many cases, the best cost saving approach is to concentrate on cost management solutions rather than packaging product solutions.
When feeling the pressure of a business slowdown, manufacturing firms and distribution centers are tempted to reduce packaging costs by turning to lower priced alternatives for shipping supplies and packaging equipment. Unfortunately, although this approach is quick and easy, reducing packaging quality almost always leads to higher rather than lower total operating costs – we’ll be writing more about soon.
Just in Time Inventory Reduces Cost in Many Ways
Our Just in Time ( JIT ) Inventory Programs have become an extremely popular cost management option, we think because the savings are real and there are no hidden costs to offset them. Among the advantages of a JIT program -
- Lower inventory costs. Pay for packaging materials and corrugated boxes as you use them, rather than months in advance.
- Better space utilization. Floor space formerly devoted to storing often bulky packaging materials and corrugated boxes can be freed up for manufacturing, office build outs, demo rooms, or other purposes that contribute to the bottom line. Particularly now, companies are subletting excess space to create a new, much needed revenue stream and avoid the costly alternative of moving to a smaller space.
- Less waste. By storing custom packaging products and boxes in advance, the risk of obsolete inventory increases.
- Reduce risk of stock outs. Companies sometimes believe that “stocking up” will ensure that packaging materials will always be available when needed. Sometimes, however, the perception of large inventories lead to looser inventory control, and stock outs occur anyway. In the real world, this is a common occurrence. With a JIT program, we watch inventory levels carefully and plan ahead, reducing the risk of line shutdowns caused by not having packaging components on hand.
If you haven’t considered a JIT program recently, we hope you will get in touch with us. Take advantage of our ample Phoenix area warehouse space and logistics expertise to fight back against an uncooperative economy.
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Packaging Materials, Packaging Equipment, Packaging Solutions
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