Analysis: Custom eCommerce packaging vs stock boxes

If your business is selling online, then one thing is certain – you are using packaging of some description.

However, many businesses fail to see the importance of eCommerce packaging and often use plain stock boxes with little thought. Doing so can allow the competition to gain a significant advantage.

The choice between stock vs custom eCommerce packaging can significantly impact the success of an online shop. Stock eCommerce packaging is typically cheaper (in the short term) and available on shorter lead times. Custom eCommerce packaging can be branded, custom-sized to minimise shipping costs and damage, and is more cost-effective in the longer term.

Saying that, custom eCommerce packaging is not always the best option for every business.

So how do you decide whether to invest in custom packaging for your online shop or use readily available boxes? This guide sets out the advantages and disadvantages of each approach.

Although it would be possible to create an entire article specifically about bespoke eCommerce boxes and packaging, there are five main areas where they offer advantages over standard cartons.

These are:

• Improved aesthetics and branding potential.
• Lower cost of shipping.
• Reduction in environmental impact.
• Better protection for products during transit.
• Quicker packing times and fulfilment efficiency.

Put simply, if you are focused on offering the best customer experience – no matter what – then custom packaging is the route for you to take.

Using bespoke eCommerce packaging allows you complete control over the appearance of the packaging and, in turn, the experience that your customers have when opening their delivery. In a world where unboxing videos get thousands of views on YouTube, this can be massively important to earning word-of-mouth recommendations and helping define your brand identity.

There are numerous other more practical benefits too.

Firstly, if you use custom-sized boxes designed for specific products, then it also reduces your overall shipping costs. These savings are due to not paying (through dimensional weight) to ship empty space (or void fill) when sending an over-sized box.

This shipping efficiency also minimises your environmental impact, as custom-sized eCommerce packaging uses less material and minimises void fill (usually foam or pellets that are difficult to recycle).

Minimising void fill is an added benefit for the end user, who has to dispose of any excess packaging.

Bespoke sizes usually offer improved transit protection too. Eliminating movement within the pack makes items much less likely to become damaged. Fewer breakages reduce returns, improve your brand perception, and ultimately lead to improved customer loyalty and repeat sales.

Finally, and if this is a particular issue for your specific fulfilment setup, custom packaging can help reduce your packing times. You can invest the resultant labour cost savings elsewhere in your business.

All of this can, when used strategically, make a significant difference to the success of your business.

So if custom packaging offers all of these advantages, why isn’t everyone using it?

The usual answer is the cost.

Bespoke packaging typically costs more, initially through any design, tooling and setup charges, with printing also adding another process which increases prices.

These upfront costs mean that, depending on the value of the items you sell, your order frequencies, your competition and your position in the market, it may not be feasible to use bespoke packaging.

The counterpoint is the offset in costs through reduced shipping charges, eliminating (or at least reducing) secondary packaging such as void fill, and the potential benefit for repeat business.

Realistically, this is likely to be different for every business and requires careful analysis (a packaging audit may help in a situation like this).

The other significant barrier to using bespoke packaging is that of flexibility.

Again, depending on the type and mix of products you sell, the packages you send may vary wildly in size. It may therefore be too difficult to define the specific dimensions you need, in which case you may find a range of standard-sized cartons suffice.

Finally, if you decide on custom packaging, there are scenarios where your packaging inventory can become large and unwieldy. This happens most commonly due to a large variation in the types of orders you are fulfiling. A bloated inventory can incur hidden costs as well.

You most likely require more storage space, have a more challenging time managing stock levels and replenishment, and miss out on economies of scale by ordering smaller volumes of a more extensive range of boxes.

So in what circumstance would your business be sensible to consider standard cartons and off-the-shelf boxes instead?

The reasons for using them are, in essence, the reasons why custom packaging would not be suitable, namely:

• Lower upfront costs.
• Can help to minimise the size of your packaging inventory.
• Better availability and shorter lead times.
• Flexibility.

The main scenario of when it is best to use stock packaging is when funds are limited.

It may be because you have only just launched your business, have recently expanded your product range, or have hired more staff. It may be because of the value of the products you ship. It may be because that is what all of your competitors are doing (you should find this out by ordering from them!).

However, it is crucial for start-ups at this stage that your branding and company name becomes well known. So even if you just print your logo on the box, it can make a surprisingly big difference.

As with everything, it is also wise to assess how much extra custom-sized packaging would cost vs how much you could save on shipping costs.

If you are using standard boxes or cartons, then the likelihood is that these are available on short lead times from your supplier (with no need for printing etc.). Short lead times allow you to keep less stock on site, allowing for more storage of products etc.

However, a “just in time” (JIT) delivery service – where your packaging supplier holds the stock for you – can provide similarly short lead times and stock availability (even when using custom packaging).

Finally, and perhaps crucially, stock boxes allow you the flexibility to fulfil similar-sized orders with the same box.