A perfect match – algorithm shows manufacturers the most efficient packaging solution

Manufacturers looking for the ideal packaging for their products have many factors to consider. With so many packaging manufacturers to choose from, it is essential to find the partner that best unites quality, efficiency and compliance with legal standards. This is where the start-up paxly.ai comes in to help find the right match.

The desire for greater sustainability in the supply chain drives the search for space-saving packaging that makes optimum use of storage capacity. Improved designs cut costs, reduce CO₂-emissions and facilitate automated packaging processes. Lightweight, compact packaging saves transport costs and offers product protection in the food industry, which extends shelf life.

"The large number of variables involved in deciding on a suitable packaging supplier is not possible without intelligent software", explains Torsten Beyenbach, Managing Director of paxly.ai. "Simply put, as packaging specialists, we offer a software tool which companies can use to break down their packaging requirements and then compare these with the performance data of retailers that manufacture packaging. If there is a match, we bring the seekers and providers together."

Optimising the size of packaging cuts costs, reduces material consumption and CO₂-emissions during transport and improves sustainability. It saves storage and transport costs, reduces waste and strengthens a brand's image as environmentally conscious, which in turn increases customer satisfaction. "This is exactly where our software comes in", says Beyenbach. "The digital tool records all of a company's article master data with packaging requirements. These include the packaging materials used to date, dimensions, weight and protection requirements for the product. Figures on sales data can be used to calculate requirements, as well as information on materials used to date, maximum weight restrictions or legal standards."

When shipping large quantities of parcels, the algorithm uses the master data to simulate millions of possible combinations for arranging the items in the shipping boxes. The aim is to find the most efficient packaging solution that makes optimum use of existing storage space and reduces empty space and air in the packaging with an ideal carton size, thus simplifying logistics.

Even without special expertise, employees are able to analyse the detailed reports generated by the software. This provides them with important facts to aid in decision-making when planning packaging or realising tendering processes. Automated packaging optimisation performs a variety of tasks at the push of a button that would otherwise have to be carried out by teams of packaging experts and packaging engineers. 

Numerous industries require very different cardboard packaging due to the wide variety of their products. For instance, the cosmetics and personal care industry needs specific packaging solutions for creams, perfumes and shampoo. The textile industry, in turn, relies on particularly exquisite packaging with elaborate printing or high-quality surfaces for premium products and special editions. The electronics industry also places complex demands on packaging, as electronic devices often require specific protection in the form of padding or separate smaller inner boxes for accessories. 

Without software, the search for the right manufacturer becomes time-consuming, like looking for a needle in a haystack, with a high risk of making costly mistakes. Paxly has developed its packaging sourcing software to find the perfect connection.

In addition to the master data on a company's items that need packaging, the software stores all relevant information on manufacturers. These include, for example, available machine capacities, processed materials, the range of available grammages, printing techniques, production capacities, delivery times, information on environmental standards and resource-efficient production as well as contractual conditions.

"The software compares the seeker's requirements with the manufacturer's performance data and bundles all suppliers that fulfil the desired packaging specifications as well as the quantity and delivery criteria in a matching list", says Beyenbach. Companies in need of packaging use the software to make informed decisions based on complex data analysis, while packaging manufacturers can use the platform to acquire new customers and optimise their potential through capacity planning

Calls for tender, renegotiations and the conclusion of contracts can also be carried out quickly via the software at the push of a button. "The results are impressive", reports the packaging specialist. "Our project analyses show, among other things, that digital comparison enables our customers to save up to 25 percent on material consumption or up to 30 percent on purchasing costs, depending on the industry. Thanks to the software support, around 15 percent of the process costs for tenders can also be saved while the process is significantly accelerated."

Costs for raw materials such as paper, cardboard or plastics fluctuate frequently. The prices of wood and cellulose in particular, as basic materials for paper packaging, are heavily dependent on global demand and fluctuations in supply. It is often difficult for packaging buyers to understand price increases, as suppliers set their prices based on various factors that are not very transparent for buyers. It often remains unclear whether the price increases are in line with the market or whether the suppliers are trying to optimise their own margins by adding mark-ups.

"Once all relevant data has been recorded in the system, price adjustments based on commodity indices with their standardised, market-oriented data basis can be quickly calculated and transparently tracked", says Beyenbach. In this way, the use of the digital platform promotes fair pricing that is transparent for both sides.