These guys are very “fundable.” They’re “A” players that have an attention to detail and proven ability to get stuff done, and they aren’t turned off by the mundane side of building products. But this is little more than a class project. Let’s dive into the three problems they’re really trying to solve:
- The cost of packaging as a percentage of total selling price ranges from 1% to 40%, and the average cost of packaging is $1 for every $11 spent.
- There are three types of packaging: the primary can, bottle or carton, the secondary decorated carton, and the tertiary pallet of shrink-wrapped boxes. All of these have an associated labor cost that is buried in the manufacturing and picking line items.
- The U.S. Environmental Protection Agency warns that the largest segment of municipal solid waste is the Container/Packaging component. Containers and packaging are the dominant materials in the waste stream.
Now your first thought may be that you don’t really see much innovation in packaging since before eCommerce took off.
Well, ninety percent of the packaging market is within the food and drink industry. Take a look at this breathtaking cola can video, while thinking through how elegantly cola packaging navigates the three problems listed above:
So the challenge from all this is to first create zero footprint packaging for a specific product in a particular local geography. The packaging needs to contain the product, inform the customer about the product, protect against tampering, theft, breakage and spoilage, be easy to transport, and be attractive for display. Then we can consider if this packaging can be scaled up to other products and geographies.
Remember the rule of 10s. Your packaging innovation needs to be 1/10 the cost, 1/10 the labor, and 1/10 the waste of existing solutions.
If this all wets your whistle, then I suggest taking a look at our source documents below, and let’s engage in conversation about ways to export U.S. packaging innovations to other countries. Please visit my office hours and continue this conversation.