Packaging To-Dos for 2022: 4 Effective Supply Chain Strategies

For many of us, 2021 earned us a master’s degree in Supply Chain Management. The production disruptions, consumer demands, material shortages, and port congestions taught us how fragile our global infrastructure can be. While we can chalk up most of the delays to the unusual circumstances brought on by the pandemic, we’d be remiss if we didn’t take notes for the future. Some retailers such as American Eagle are already planning ahead by investing in their own logistics solutions. The government is also on board with change, making progressive steps through the INVEST in America Act, which includes more than $550 billion in spending on projects focusing on strengthening supply chains and infrastructure.

What more can buyers do to prepare for a smoother year ahead? A key focus should be on packaging supply. As many experienced, the paper bag demand was just another unpredictable fallout of the pandemic. But with the proper planning in place, retailers and restaurants can avoid future pitfalls and emerge proactively victorious, rather than reactively scrambling for solutions.

We polled our team of packaging experts to brain-dump their top recommendations to buyers for 2022 and the years to come. Here’s what they had to say:

Tip No. 1: Lock it in with a Multi-Year Contract.

Plan ahead and place a multi-year contract if it’s available to you. This will help ensure you have a place in production schedules and aren’t bumped off in favor of other clients. The right packaging partner will also help you anticipate your release schedule so that you’re not short (or long) of inventory in your supply chain.

Tip No. 2: Be Nimble.

With the drastic changes in market conditions and supply chain delays, pricing for materials and shipping can fluctuate weekly. Because of this, many factories aren’t allowing blanket orders anymore, and are sometimes holding quotes for as little as one week. Those who are nimble will enjoy the greatest benefits in 2022. What does this entail? Being nimble requires connecting your omnichannel services. From suppliers to manufacturers to logistics and store managers, everyone in the supply chain must be connected and talking to each other to fully understand your usage and inventory projections. This will help you place a more accurate order well in advance and jump on good pricing when the time is right.

Tip No. 3: Consider a Nearshore Focus.

Worried about shipping delays and costs? Start looking at your manufacturing geography. Nearshoring is a new focus for many retailers such as Mattel who want to have more control over their lead times. Ocean freight rates soared 385% from last year and were seven times the pre-pandemic norm at the end of October, according to data from Freightos. Find a packaging partner who has alternative sources closer to home or with better port options. This can help close the gap of the unknown, both for budget and timeline.

Tip No. 4: Challenge your Manufacturing to a Dual (Source).

During the pandemic, many retail and restaurant buyers were left disappointed – or worse – empty-handed by their suppliers. Depending on the size of your business, you may want to consider diversifying your suppliers for certain packaging items to ensure you have a consistent source of product. Dual source manufacturing is a technique that many larger companies have adopted to avoid the exact kind of production pitfalls we saw during the pandemic, such as natural disasters, port closures, scheduling issues or material shortages. There are a few cons to this method, such as inconsistent quality and – despite what you’d think – price. Because you’re splitting your purchase, you won’t have as much buying leverage if your individual spend is smaller. But if your goal is to ensure you have an uninterrupted flow of product, then dual source manufacturing may be a good solution for you.