Abstract
Traditionally, the importance of packaging for international supply chains is most often underestimated. This is surprising for such a complex phenomenon, situated at the interface of different functions (logistics, marketing...), different decision levels (operational, tactical, strategic), and different logistics flows (physical and informational). This chapter questions the traditional design and typology of packaging used within international supply chains in the light of two main drivers: (1) its circular/closed-loop requirements and related performance notion and (2) omnichannel trends, including e-commerce, and new customer delivery services. Mobilizing the spanning concept of “logistics functions of packaging” (LFP), this chapter proposes a conceptual framework enabling to trigger adequate novel packaging solutions matching these new expectations. Recent business cases occurring within international supply chains illustrate and deepen our reflection.
TopIntroduction: Mobilizing Theory To Understand And Meet Packaging Trends In International Transportation And Logistics
Packaging is omnipresent in today’s international supply chains. Worldwide use of maritime vessel containers, for instance, has been multiplied by more than 16 between 1980 and 2016, representing a cargo increase from 102 million tons to 1687 million tons (CNUCED, 2016). In this chapter, the authors make an inventory of theoretical frameworks in order to understand and meet principal packaging trends in contemporary international supply chains. Research-side, packaging logistics, and its constitutive concept of logistics functions of packaging (or LFP) turn out to be particularly suitable for analysing and meeting two main change drivers that characterize contemporary supply chains: first, circular economy and closed-loop logistics requirements, and second, omnichannel trends, including e-commerce. Most managers and researchers dealing with international supply chains are familiar with these trends, but only some of them fully consider the related impacts on packaging. More precisely, this chapter analyses how relevant and adequate traditional packaging designs and typologies still are with regards to these new market evolutions and proposes a new theory-based solution for matching the new challenges.
But what is packaging? Packaging can be defined as “a means of ensuring safe and efficient delivery of the goods to the ultimate consumer followed by an efficient reuse of the packaging or recovery and/or disposal of packaging material at minimum cost” (Bjärnemo et al., 2000). For a long time, the role of packaging within the supply chain has been overlooked by both academia and practitioners (Azzi et al., 2012), in spite of its strategic and operational importance (Pålsson & Hellström, 2016). If this observation is already true for national or domestic supply chains, the lack of scientific and professional contributions in this domain is even more surprising for international supply chains characterized by long circuits, numerous chain members, “touches” and other links, more frequent process operations in heterogeneous contexts (climate, temperature, sun rays, corrosion, technologies, infrastructure/ mechanization/automatization levels, and cultures), a high number of in-transit changes that have to be made between transportation modes and warehouse locations, and the long duration of customer claims in case of damaged product arrivals due to inadequate packaging (Chan et al., 2006). Fortunately, perceptions are starting to change. Not only does globalization of supply chains contribute to the continuous rise of the packaging industry (Azzi et al., 2012), the latter also improves, through steady container innovations, the overall strategic viability and operational fluidity of international supply chains. In other words, we cannot ignore the numerous interactions between, on the one hand, increasing globalization and, on the other, the importance of the packaging industry and its heterogeneous “products” deployed within global supply chains. Meanwhile, the role of packaging within international supply chains is rightly-perceived “as a ‘unitization’ system, which begins with the shipper and ends with the customer” (Chan et al., 2006).
In line with the international nature and scope of this book, this chapter cites concrete packaging examples from global supply chains covering various regions of the planet to support and illustrate the authors’ flow of reasoning. Adopting a dedicated international perspective seems not indispensable, as most contemporary supply chains are per se international or global (Hult et al., 2014; Meixell & Gargeya, 2005), as developed in Box 1.
Key Terms in this Chapter
Standardization of Packaging: the considered container easily accommodates different contexts and could adapt optimally to upcoming situations, by exploiting future opportunities. The authors consider packaging as standardized if it is easily adaptable to other product-packaging supply chains.
E-packaging: a term that the authors use to designate containers fitting with novel e-commerce requirements as part of omnichannel settings. Instead of adapting existing brick-and-mortar packaging to these novel challenges that mostly results in unsatisfying solutions, we prefer to design e-packaging by adopting a more abstract level of reasoning, considering functional analysis principles. Breaking new grounds means emancipation from any premature constraint in terms of packaging material and/ or shape and results in optimized fulfilment of packaging functions, LFP, and others.
Differentiation of Packaging: the considered packaging is optimized and adapted for a given situation, vis-à-vis its main functions. The authors consider packaging as differentiated if it is adapted or tailored regarding a specific product-packaging supply chain (“optimal fit”).
Logistics Functions of Packaging (LFP): they typically include product protection, the flow of information, volume and weight efficiency, right amount and size, handleability, and other value-added properties. Both physical and informational logistics flows are covered. Beyond the logistics scope, packaging also performs functions related to marketing and environmental/societal features.
Circular Economy: according to this paradigm, our supply, distribution, and consumption systems give up processing materials and other resources in a traditional “one-way” or linear manner, typically ending with their disposal. Instead, “waste” or other system outputs (secondary raw materials, valuables) are reinjected in the economy, allowing numerous additional cycles at high utility. In management literature and practice, circular economy frequently overlaps with related notions such as sustainable development/sustainability and Corporate Social Responsibility (CSR). The supply chain management discipline can support - if not initiate - circular economy through closed-loop logistics principles.
Omnichannel Settings: consumer’s shopping experience is integrated across all customer touchpoints and distribution channels, both brick-and-mortar and digital ones, including e-commerce/ m-commerce. Ideally, neither the consumer nor the supplier/retailer distinguish between channels anymore. Whereas the former enjoys a seamless shopping experience and increased delivery flexibility in terms of time and space, the latter profits from a holistic and optimized visibility of the supply chain.