3 min read
Reducing packaging update costs: proven methods
FMCG (Fast-Moving Consumer Goods) companies often face challenges in managing product revision workflows due to the complexity and scale of their...
Imagine this: your product is ready to hit the shelves, but there's a problem—the packaging graphics are wrong. Maybe the colors are off, the design doesn't match the brand, or worse, crucial information is missing. It may seem like a small error, but this mistake can snowball into a financial nightmare. From wasted materials and production delays to lost sales and damaged retailer relationships, the true cost of packaging errors can be staggering.
In this article, we'll explore just how costly it can be when packaging goes wrong. We’ll take a closer look at the hidden expenses that pile up when you cut corners, from wasted product and logistics chaos to brand reputation damage. By comparing the cost of prevention versus correction, you'll see why it's always worth investing in getting your packaging right from the start!
Packaging graphics encompass everything from brand logos, product information, and regulatory details to visual designs that appeal to consumers. Accuracy is critical because even a small error—such as a typo, incorrect barcode, or inaccurate allergen labeling—can render the entire batch of packaging unusable. When this happens, companies must often choose between scrapping the packaging or risking penalties and loss of consumer trust, both of which can be damaging.
When packaging graphics are wrong, the initial fallout typically involves the following expenses:
Wasted Packaging Materials: Printed packaging materials, whether made of cardboard, plastic, or composite materials, must be scrapped if they contain errors. Depending on the production scale, this could mean thousands or even millions of units going to waste. The costs of printing, materials, and storage add up quickly, leading to a significant loss.
Reprinting Costs: Beyond the wasted packaging, the company must reprint the corrected versions. This involves setting up new print runs, which can be costly in terms of both time and money. Depending on the complexity of the graphics, the cost of new printing plates or digital print setups can be substantial.
Labor Costs: Additional labor may be required to identify the error, communicate with print vendors, and manage the reprinting process. This takes time away from other projects and delays the production schedule, further compounding costs.
Once the packaging error has made it past the initial production stage, the costs can become even more severe. Here’s how:
Wasted Product: If the defective packaging has already been filled with the product, the company faces the difficult choice of either discarding or repackaging the goods. In many cases, repackaging may not be feasible due to regulations or the nature of the product (such as perishable goods). This can result in the loss of product inventory, adding a significant hit to the company’s margins.
Transportation and Logistics Costs: If the erroneous packaging is only discovered after products have been shipped to distributors or retailers, the company may need to recall those products. The transportation costs involved in retrieving these products, storing them, and reshipping replacements can be immense, not to mention the administrative burden of managing a recall process.
Retail Penalties: Many retailers impose penalties on suppliers for delivering incorrect or non-compliant products, especially if the error disrupts the retailer’s operations. Retailers expect products to arrive shelf-ready, and any deviation can result in fines, loss of shelf space, or even termination of vendor contracts.
Brand Damage and Lost Sales: The most intangible but potentially the most damaging cost is the impact on a brand's reputation. If consumers encounter incorrect or misleading packaging, they may question the quality and credibility of the brand. This can result in a loss of consumer trust, which is difficult to rebuild and can lead to decreased sales in the long term
To illustrate the importance of investing in quality control during the initial stages of packaging design, let’s compare two scenarios:
Scenario 1: Cutting Costs on Initial Design
A company decides to save $5,000 by opting for a less expensive design process without thorough proofing. However, a mistake is overlooked—a misprinted label. The error is only discovered after 100,000 units of packaging have been printed and 20,000 units have been filled with product.
Total additional cost: $105,000
Scenario 2: Investing in Thorough Design and Quality Control
This company invests $5,000 in a more comprehensive design and proofing process, which includes multiple rounds of review, sample prints, and compliance checks. The error is caught early, and the packaging is adjusted before mass production.
Total additional cost: $11,000
In this comparison, the company that invested in initial quality control saved nearly $94,000 by preventing a costly mistake. While it may seem appealing to cut corners in the early stages, the financial impact of errors that reach later stages of the product lifecycle can far outweigh any savings.
The lesson is clear: when it comes to packaging graphics, investing in thorough design and quality control processes is not an area where companies should seek savings. A seemingly minor error can quickly snowball into significant expenses and damage to the company’s reputation. By ensuring accuracy from the beginning, businesses can avoid the cascading costs associated with reprinting, product waste, recalls, and brand damage.
In the competitive world of retail, where margins can be slim and consumer trust is paramount, the right packaging graphics can mean the difference between a successful product launch and a costly setback. A small upfront investment in quality control can save a company from a much larger financial headache down the line.
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