This year and the year before, food companies are trying to reassess and make their packaging products better for e-commerce fulfillment. But it’s totally a different supply chain. Because when you are shipping a full truckload of products like Walmart, you know whatever the case is. And for e-commerce, all these one-offs. Now you’re shipping to individual consumers, so it challenges the transportation network, as well as the raw material network as well. Though food packaging companies are really trying to pivot more towards e-commerce friendly packaging, there’s been a challenge for them this year after we talked with several companies.
1. E-commerce package would rise the cost of the distribution cycles
Retail and e-commerce, most food companies want to satisfy both of them. So some of the struggles around that food packaging typically are pretty price sensitive. Thus, e-commerce packaging adds cost to withstand those distribution cycles that are required. For smaller brands and emerging brands, a lot of their sales and distribution is through e-commerce. So they are using a flexible package and basically shipping their products direct to the consumer. For them, they are not influenced that much.
2. The cost for shipping the fresh food is believably high now
Some companies sold their own products to retails like bakeries and walnuts. And we have worked with several of them to come up with B to C packaging applications like pastries. The challenge that we’re seeing right now is the cost to make when you’re doing temperature-sensitive shipments of fresh food or food that’s perishable or frozen. The cost of the insulating material has been skyrocketing. You’re either facing using like the nasty cheapest bubble wrap material that really doesn’t particularly look good probably, or isn’t particularly environmentally friendly. Or you look at what’s going on in the direct-to-consumer shipping worlds like FedEx or UPS, they’re all having a few their own struggles with reaching the customers in time. So where we’re being tasked to focus right now is can we come up with something that gives someone 60 to 72 hours worth of shelf life in a frozen or highly refrigerated package. And I think right now the challenge has been a lot of the resources that are available typically with that kind of materials have been taken up with vaccines and other more important missions. So what we’re left with is looking at sort of secondary options but not the foam which is a great insulator but horrible for the environment. It has a bad stigma. So we’re looking at companies facing unbelievable costs now to ship these products to their consumers. And yes when they got into this two years ago, I don’t think they fully appreciated how expensive it would become. We’re seeing now that they’re looking to extend the shelf life so they can reduce the shipping cost by shipping it on the second or third day. That’s what we’re seeing this next level of focus going on, and we’re working on those issues right now. And distribution circle is what we should consider for traditional retail companies.
