In these times of social media and internet-based retail businesses, packaging has changed. Flexibility is key and fixed high volumes are being replaced by small volume runs.
Karen Wardell reports.
In the past five years, the manufacturing and packaging industry landscape has changed significantly with respect to fast-moving consumer goods.
The union between popular culture and internet technology, specifically online retail, blogging, and social media, has had big implications for branding and marketing initiatives, presenting a huge business opportunity.
Nathan Wardell, Managing Director of packaging equipment hire company Packserv, sheds some light on the relevance of these trends for SME manufacturers and packers.
“Australian packaging businesses are certainly utilising the marriage of technology and social media to propel business growth. The focus has shifted away from traditional reporting factors such as global social and economic factors, particularly with respect to costs associated with offshore manufacturing and packing,” explained Wardell.
Often described by his customers as the “go-to man” when it comes to short- or long-term hire of packaging machinery, Wardell is always surprised by how many manufacturers and packers engineer new strategies that positively impact their business growth.
“In the packaging industry, I have found that my clients who have experienced the most positive growth are those that are very flexible,” Wardell said.
He notes that in the past fifteen years – since the rise of the internet and social media – there has been a clear shift in how manufacturers approach packaging.
Packserv’s clients are finding new opportunities and have evolved in two key areas: contract manufacturing and internet retail.
Whereas in the past, manufacturers were accustomed to fixed high volumes, many well-established, traditional contract manufacturers and packers have become flexible and started accepting small volume runs.
Manufacturers that produce and package their own brand are now offering contract packaging services for external businesses. This allows them to not only continue producing their own product but also to maximise their output and revenue by offering smaller volume runs to other labels.
Over the past eighteen months, Wardell has seen many of these contract packing outfits emerge. As a result, these unassuming contract packers are in high demand and are hiring packaging equipment from Packserv to cope with the extra work.
These manufacturers are also on a steep learning curve, discovering that existing equipment and packaging processes may not be suitable for all incoming work.
“Many small to medium manufacturers have been quick to see and act on this opportunity. They do need to have the versatility to troubleshoot and solve packaging issues quickly to be successful with this transition,” Wardell said.
Contract packers who offer flexibility in line with customer needs are having a positive impact on niche businesses, which can introduce small volumes to the market and still retain the ability to develop the product at a risk-free pace.
Brand owners are taking on the manufacturing and packing of their own products. They are opting to do the manual work themselves, hiring relatively slow-speed, small, bench-top machines.
These businesses are not only concerned with tight cost and quality control processes but are also focused on social media and e-commerce strategies to build their brand and sell products.
Wardell pointed out that his client base is becoming more and more diverse.
“You would be surprised at which businesses have adopted changes. Established businesses that are household names are definitely moving with the times and using our services, as are many new businesses that are quick to get established in such a short period of time,” he said.
Many of Wardell’s new clients are solely internet-based retail businesses. He works with many clients who take an idea, turn it into a product, and sell it online.
“They hire in the equipment to package their product to keep overheads down, and their sales are global,” he explained.
He cited two manufacturers who recently built businesses in Sydney and then adapted their websites from essentially marketing tools to interactive online stores to gain a solid global audience.
Their US market grew so quickly through internet sales that they had to open a US distribution centre.
Ready to take your packaging and manufacturing to the next level? Whether you’re an established brand or a new business looking to adapt to the fast-paced world of social media and internet retail, flexibility is the key to growth. At Packserv, we’re here to help you navigate the evolving landscape with short- and long-term equipment hire that fits your needs.
Explore how you can optimize your production with our wide range of packaging equipment and expertise. Contact Packserv today to learn more about how we can help you scale your business with efficient, flexible, and cost-effective packaging solutions.
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Or you can read it in Manufacturer’s Monthly.