Insight into the objectives, challenges, and achievements of a comprehensive project to reduce packaging costs
Which packaging topics were addressed?
The project covered all relevant types of packaging used by a branded food manufacturer. The initial focus was on primary packaging — packaging that comes into direct contact with the product — particularly films and pouches used for items like dried fruit, sugar, or coffee. Some of these packages include zippers or degassing valves, making them resealable or breathable.
The analysis also included secondary packaging, mainly shipping cartons for transport and shelf-ready packaging used in retail. These often feature tear-open perforations for use in shelf-pushing systems that automatically move products forward on the shelf.
Another key element was packaging licensing — the legally mandated participation in take-back and recycling systems such as the Green Dot. Tertiary packaging, such as stretch films or strapping bands, was not analyzed in depth. The project clearly focused on packaging solutions that directly impact the product, retail, and logistics.
Was a potential analysis conducted, and what were the findings?
Approximately two months before the project officially began, a comprehensive potential analysis was carried out. The goal was to review all relevant packaging levels of the branded food manufacturer.
The analysis revealed that the supplier structure, especially for primary packaging, was highly limited. Although several suppliers existed, each was only qualified for specific product types. The lack of interchangeability among suppliers meant there was no real competition, creating a strong dependency. A failure of any single supplier could have led to production stoppages or delivery delays. Furthermore, price transparency was low. Agreements were typically short-term (six to twelve months) and did not include automatic adjustments for fluctuating raw material costs. Each quote had to be requested and negotiated individually — a time-consuming and inefficient process.
One particularly critical issue was the strong reliance on suppliers of PCR films (recycled plastic), which had to be pre-booked far in advance and were limited in availability. This further intensified the dependency. At the same time, the analysis identified potential alternative sourcing markets — particularly in Southern and Eastern Europe. These offered attractive conditions but required a time-consuming qualification process, including machine testing and shelf-life assessments.
The availability and usability of data proved challenging. Much of the information was in difficult-to-process formats like PDFs and had to be manually prepared to create a viable and tender-ready database. Overall, the analysis provided valuable insights into structural weaknesses, price risks, and new opportunities that were systematically leveraged during the project.
What were the goals of the packaging cost optimization?
The core goal was to reduce the high dependency on individual suppliers and improve supply security. The aim was to establish a reliable backup system that would allow for quick and flexible responses in case of supplier failure. Another objective was to broaden the supplier base to foster competition and enhance the company’s negotiation position.
A further goal was to reduce packaging costs and transition to more sustainable packaging solutions. The original project timeline was eight months, but this was extended due to the intensive effort required for data collection and processing. Ongoing changes to packaging specifications, aimed at improving recyclability, also contributed to the longer timeline.
What challenges arose during implementation?
A major challenge was the adjustment of packaging specifications during the project. To improve recyclability, future films were to be made from monomaterials, which introduced new requirements regarding materials, machine performance, and interdepartmental coordination. Procurement, marketing, and production were all heavily involved.
The upcoming design relaunch further complicated implementation, as it required the creation of individual printing cylinders for each product — a time-consuming and costly process. For secondary packaging, it was found that many cartons were overspecified, often using double-wall materials. The client had already begun revising these constructions in parallel with the project.
What concrete savings and improvements were achieved?
The project achieved savings of approximately €1.4 to €1.5 million in packaging alone. About €700,000 was saved through negotiations with existing suppliers of primary packaging. An additional savings potential of over €1 million was identified, pending the qualification of new suppliers. One new supplier from the regional area was onboarded due to competitive pricing.
Beyond financial savings, qualitative improvements were also realized. Oversized packaging solutions were identified and reduced. New, potentially high-performing suppliers from other regions of Europe were found, offering long-term flexibility and improved supply security. Significant price reductions were also achieved for display packaging through smart negotiations with the existing supplier.
What learnings or best practices can be derived from this project?
One key learning was that professionally managed tenders offer immense savings potential — even in companies with long-established supplier relationships. Previously, the client rarely issued structured tenders and relied on long-term partnerships. The tender process revealed competitive alternatives in terms of both cost and quality.
It also became clear that initial concerns about suppliers from more distant regions — such as Southeast Europe — were largely unfounded. Language or logistical challenges can be effectively managed with proactive planning and the use of regional warehouse structures. While no fundamental process changes were made within departments during the project, awareness of the importance of a diversified and flexible supplier network was significantly increased.
This project not only generated substantial short-term savings, but also laid the foundation for a more sustainable, future-proof procurement strategy.
Contact:
Kloepfel Group
Damir Berberovic
Phone: +49 211 941 984 33 | Email: rendite@kloepfel-consulting.com