How contract packaging is benefiting the food industry

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In the food business, packaging is a huge operation in itself. While many companies want to keep control of this due to the unique needs and higher standards for safety, there are quite a few benefits that contract packaging can offer.

Contract packaging means one business hires another business to help with some or all of several aspects to the packaging process:
 

  • Creating packaging materials
  • Putting products into packages
  • Storing packaged inventory
  • Distributing packaged products
     

This arrangement is growing rapidly in the food packaging industry. Considering food’s unique needs and higher standards for safety, contract packaging can offer the food industry quite a few benefits. Let’s look at the major ways contract packaging can benefit the food industry.

Preserving resources

This is the most obvious one, and also the one that usually motivates companies to go with contract packaging. It’s especially appealing to smaller companies that are growing and don’t have their own packaging capabilities yet, but also for larger companies that may be expanding in some way, moving into a new market, or introducing a new product.

Contract packaging means you don’t need to invest in production capabilities on your own. From facility space to store packaging materials to packaging equipment and even possibly to transportation and other logistics costs, you can reduce your expenditure and also reduce the complexity of your asset management.

For your bottom line, this could lower operational costs by as much as 20%, according to ResearchAndMarkets.com, thanks to reduced expenses on labor and maintenance.

How? Since contract packagers specialize in packaging, they have the expertise and equipment to do things as efficiently as possible. Both from scale and focus, many contract packagers are able to operate in a more lean way that most food companies simply can’t.

Improving processes

Speaking of processes, because contract packagers focus on packaging alone, they’re able to find ever-more efficient ways of doing things. Whether it’s making the most of the material they use, optimizing warehouse space and storage, or even developing new technology to package better and faster, they have a vested interest in making sure their operations are optimized.

Contract packagers may even form partnerships with companies that produce materials for packaging. This can drive innovation through research and development, creating new materials as well as methods for producing those materials.

Increasing flexibility

While it might seem ideal to have the particular machines and materials that you use for your own products, investing in your own packaging infrastructure may ultimately limit you. Once invested, there is a steeper cost if you decide, for instance, to consider looking into flexible film food packaging.

However, a contract packager likely already has that infrastructure in place. Depending on your relationship, you might even be able to run a bit of an experiment, testing how a product performs in new packaging before leaping into making a complete switch. For instance, they may have specialized testing packaging to show what can happen during a crush inside a truck or if a particular sort of impact happens.

Similarly, a contract packager may be able to offer specialized packaging or custom designs that require expensive equipment that would make such specialization otherwise economically impossible. Or, this could be about scale, which can be especially valuable for seasonal crops as well as producers of items that are popular around holidays and need to deliver more volume at certain times, like, say, October for candy manufacturers. Contract packagers have the ability to scale up or ramp down, which might make a ton of sense for food producers whose output isn’t a steady stream.

In short, since a contract packager has a lot of options, you have a lot of options—without a lot of up-front investment or underutilized equipment.

Reducing spoilage

While your team has experts who know how best to prevent spoilage, contract packagers also have certain capabilities to complement that expertise. For one, their specialized expertise in packaging may help them identify new trends or materials that could offer opportunities for improvement. Even if they don’t specialize in food packaging, their overall focus on packaging could mean they spot an opportunity that you can benefit from.

Their speed is also a benefit. As you know, time is a crucial aspect for freshness, and contract packaging can help expedite delivery. Because their infrastructure is designed for maximum efficiency and speed, they can operate in a way that’s faster than a homegrown system can. Getting foods packaged and delivered more quickly helps lower rates of waste, not only saving money but also positively affecting the environment.

When considering contract packaging, keep three main factors in mind.
 

  1. Since packaging is so important for food, it needs to be handled by experts.
  2. Automation is key to a successful packaging line.
  3. Make sure you have the right materials and design in the first place.
     

As you consider the benefits of contract packaging, consider the benefits of having a partner. To take advantage of Veritiv’s packaging experts, contact us today!