How a Major CPG Retailer Saved $3.1M on Packaging in 9 Months With Procure Analytics

Project Background

A leading CPG retail company sought Procure Analytics’ expertise to save on their packaging spend across all six business units (BUs). PA’s Packaging division started with an initiative to reduce spend on the company’s existing packaging materials.

PA’s engineering team engaged in a phased approach, delivering like-for-like packaging savings of $2.3MM in Phase I, and hard dollar savings of $800K during Phase II’s engineering project.

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PA delivers continuous year-over-year value and savings to more than 90 of our portfolio and investment companies with unprecedented customer service, world-class reporting, and the full suite of value-added vendor services.

~ Greg Beutler, Blackstone, parent organization of Member company

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Phase 1: GPO Program Before & After

Packaging Pre-GPO Status:

• 9 unique packaging suppliers
• $17MM+ total packaging spend
• Wasted materials and labor during packout

Packaging Results After Joining PA’s GPO Program:

• $2.3M in savings
• Reduced to 6 unique packaging suppliers
• New supplier structure standardized the supplier base across all BUs and allowed each to leverage their overall spend

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Phase 2: Packaging Engineering

Employees of the company’s largest BU opted to use the largest of three boxes as a default, leading to higher packaging costs, poor cube utilization, and higher shipping costs when smaller boxes would have sufficed.

The approach was to design optimal box sizes to decrease the overall number of options provided during packout. The PA Packaging Engineering methodology included the following:

• Identified all critical product LxWxH ranges
• Designed new case sizing to ensure pallet utilization remained above 90%
• Developed cube utilization models to determine total % of product SKUs covered by new boxes
• Conducted multiple time studies of new configuration, minimized packout labor

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Savings Results

The combined results from both phases accounted for $3.1 million in packaging savings.