Packaging costs quietly eat into margins. For many businesses, packaging represents 10-15% of total product cost — yet it is one of the most overlooked areas for optimization. Here are seven proven strategies to reduce your spending without compromising product protection.
1. Right-Size Your Boxes
Oversized boxes waste material and increase dimensional weight charges from carriers. Audit your top-shipped products and match box sizes precisely. Even a 1-2 inch reduction can save significantly at scale.
DIM weight pricing means you pay for the space your package occupies, not just its actual weight. A box that is 2 inches too large in each dimension can cost $0.50-$1.00 more per shipment in carrier fees alone. Multiply that by thousands of shipments and the savings become substantial.
2. Switch to Used Boxes
For B2B shipments, internal transfers, and storage, used boxes deliver identical performance at 30-60% less cost. Start with non-customer-facing applications and expand from there.
3. Negotiate Volume Pricing
Whether buying new or used, volume commitments unlock better pricing. Work with your supplier to establish a supply agreement with guaranteed rates. Most suppliers offer tiered pricing that rewards consistent ordering — ask about quarterly or annual contracts.
4. Reduce Void Fill
Right-sizing boxes (tip #1) naturally reduces the need for void fill materials like bubble wrap and packing peanuts. Less void fill means less material cost and faster packing times.
Consider switching from traditional void fill to more economical alternatives. Kraft paper is inexpensive and recyclable. Air pillows are lightweight and cost-effective. Corrugated inserts can be custom-designed to eliminate void fill entirely while providing superior product protection.
5. Reuse Incoming Boxes
Set up a system to collect and reuse boxes from your incoming shipments. Many businesses throw away perfectly good boxes that could be used for outgoing orders. Designate a staging area, train staff to flatten and sort incoming boxes by size, and integrate them into your packing workflow.
6. Consolidate Shipments
Instead of shipping multiple small boxes, consolidate orders into fewer, larger shipments where possible. This reduces per-unit packaging costs and shipping charges.
7. Partner with a Packaging Expert
A packaging consultant can audit your entire supply chain and identify savings you might miss. The investment typically pays for itself many times over in reduced costs.
Putting It All Together
The most successful businesses do not implement just one of these strategies — they combine several into a comprehensive packaging cost reduction program. Start with the quick wins (right-sizing and used boxes), then layer in the more strategic changes (volume agreements and consolidation) over time.
- Week 1-2: Audit your current packaging spend and identify your top 10 shipped SKUs
- Month 1: Right-size boxes for your highest-volume products
- Month 2: Begin sourcing used boxes for internal and B2B shipments
- Month 3: Negotiate volume pricing with preferred suppliers
- Quarter 2: Implement void fill optimization and shipment consolidation
- Ongoing: Track savings monthly and reinvest in further optimization
Common Pitfalls to Avoid
While cutting packaging costs, be careful not to fall into these common traps that can end up costing more in the long run.
- Cutting too much cushioning: Damaged products from under-packaging cost far more than the packaging savings
- Ignoring brand perception: Customer-facing packaging that looks cheap can erode brand value
- Chasing the lowest price only: Reliability, consistency, and supplier responsiveness matter as much as price
- Skipping testing: Always test new packaging configurations with actual shipments before rolling out at scale
- Forgetting hidden costs: Factor in labor time, damage rates, and returns when calculating true packaging cost
By systematically applying these strategies, most businesses can reduce total packaging costs by 20-40% within six months. The key is to start measuring, start optimizing, and never stop looking for better ways to pack and ship.