Five strategies to help carton manufacturers mitigate the impact of rising raw paper prices

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In the corrugated packaging industry, the cost of base paper used for manufacturing corrugated boxes is directly influenced by the paper index, which reflects the transaction price between paper mills and their customers.

Tier 2 or Tier 3 factories often face additional costs related to starch, packing straps, diesel, energy, or insurance from their suppliers. These expenses must be absorbed in a highly competitive and cost-sensitive market environment.

When companies prepare their annual budgets, most anticipate and account for expected increases in packaging costs. Even when adhering strictly to budgetary constraints, procurement teams remain under constant pressure to identify both direct and indirect cost-saving opportunities. When confronted with rising paper prices, there are several viable strategies to offset these increases. Below are five effective approaches:

1. Adjust the dimensions of transport cartons
Transition from standardized carton inventory to customized sizes. While many customers assume that customization increases costs, in reality, tailored carton production can better match product specifications, reduce material waste, and lower overall expenses. If oversized pallets have been used within the past 30 to 60 days, custom-sized cartons can offer multiple cost-saving benefits.

2. Increase order quantities
Producing larger quantities can reduce the per-unit cost of each carton. Each production run incurs a fixed setup cost. By increasing the number of cartons produced per run, fixed costs can be distributed over a larger volume, thereby lowering the overall unit cost. Corrugated materials are priced per square meter, so larger orders typically result in lower material costs.

3. Redesign for material efficiency
In many cases, products are over-packaged, leading to unnecessary material usage. A redesign by an experienced packaging engineer can yield a more efficient solution that significantly reduces both packaging and labor costs.

4. Consolidate SKUs
Introducing additional creases in custom carton designs can allow for variable depths within a single carton type. Reducing the number of stock-keeping units (SKUs) in production can lower manufacturing costs and improve inventory management.

5. Upgrade cardboard grade combinations
Explore alternative combinations of corrugated board grades. There are 19 standard configurations available. Have you selected the most cost-effective and performance-optimized option? Simple material substitutions can often reduce costs while maintaining adequate protection and structural integrity.