Lynn Grady, General Manager of DHL’s Consumer Sector’s Co-Pack operations looks at the benefits of contract packing to food and drink manufacturers and the solutions it provides.

Co-packing provides customised, shelf-ready packaging solutions to manufacturers and retailers, with capabilities including shrink wrapping, labelling, corrective re-working, ‘end of aisle’ displays, gift packs and many more, the food and drink market is spoilt for choice.

The FMCG sector often utilises seasonal campaigns and promotions, and co-packers work closely with food and drink businesses to optimise packaging appeal and to ensure the embellishment accurately reflects brand values.

Co-packing is a bespoke process that helps companies to improve shelf presence, be more creative and dynamic in the competitive retail market and ultimately has the ability to directly influence sales.

There are five key aspects of co-packing activity: assembly, reformatting, repair, marketing and primary. Assembly includes gift packing, packing into specific variants and assembling specific types of packages, for example converting bulk units to cases. Gift packing is highly popular throughout the food and drink sector as many retailers require specially produced packs for seasonal promotions. For example, a typical promotional activity for Valentine’s Day is a presentation box of chocolates and champagne.

Re-formatting is used to prepare products for export by obscuring parts of labels or by applying country specific labels. In addition co-packers can also create special packs for wholesalers or re-bag items weighing from 5kgs to 1 tonne. Co-packers will also repair packaging if it has been damaged in transit, has failed quality control and must be repackaged or if barcodes will not scan. These key services provided by co-packers can be used individually or as part of one operation.

Co-packing can strengthen product marketing and has grown in popularity thanks to the increasing importance of ‘instant offers’ in store. Enhancements are often made to point of sale promotions. For example ‘end of aisle’ displays are placed throughout the shopping experience to promote product offers including BOGOFs, bonus packs and discounts in a way that is hard to resist. By having the display ready-made, it reduces the amount of time retailers spend putting the display together, as well as differentiating the brand from the competition.

Primary co-packing is increasingly outsourced and can involve major investment from the co-packer. The food and drink sector benefits from third party labelling systems and hand and automated packing of produce in temperature controlled facilities. The co-packing service can be further strengthened if the co-packer manages the supporting supply chain, ensuring that the needs of the customer, retailer and consumer are met at every stage of the process.

The capability DHL has to provide a ‘full service offering’ means that unformatted products can be shipped to the customers’ preferred location where the stock is managed, packaging materials are ordered and the goods are repackaged. Furthermore, the final product is delivered to the end user in one seamless operation with the reassurance of full product traceability within the customer’s supply chain.

Packaging will always create the consumers’ first impression of a brand, and it is important that the packaging produced by co-packers reflects the brand through quality and design. The food and drink sector should see co-packing both as a solution to their packaging needs, offering cost efficiency, convenience and flexibility for a variety of purposes and as a way of enhancing brand and marketing strategy.

 

supplychain.uk@dhl.com 0800 316 0498

 

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