Navigating the new Singapore low-value tax schemeWatch the webinar
Countdown to ICS2 release 2: Are you prepared?Watch the webinar
February 8, 2023 / 0 min read - Last updated: March 1, 2023
Have you ever ordered something small online that arrives at your door in a seemingly unnecessarily huge box? The answer is probably yes. As a shopper, you might wonder, “Why don’t companies just send products in packaging that better fits the goods in the order?” In fact, you may be a retailer reading this and thinking, “It’s not that simple!”
Both sides, the shopper and the retailer, have valid points. Most of the time, a tiny item being sent in a comically large box is material waste and not the best decision and usually a result of the sender grabbing the first box they saw or the only size they had left; other times, it might be part of an algorithm that takes certain factors into account to determine the best carton size for packaging an order.
It may seem easy to say, “put large items in large boxes and small items in small boxes,” but that is not always the best decision. So, how do businesses determine which packaging to use for different SKUs or a combination of SKUs in one order? Many businesses do not put much thought into this, but others, especially with a warehouse management system (WMS) use a cartonization algorithm.
Cartonization is an automated algorithm that determines the packaging type to use for an order based on multiple factors that will be discussed later. To better understand cartonization and determine if it is right for your business, this blog will discuss the following:
To fully understand cartonization, it’s important to be familiar with the term “warehouse management system” (WMS) and what they do.
A WMS is a software system with automated processes that allow businesses to control, keep track of, and manage warehouse operations from when products or materials enter a warehouse until they leave. In other words, a WMS facilitates processing and putting away goods in the warehouse, distribution center, or fulfillment center; order picking, packing, and fulfillment; inventory management; shipping; labor management; and more.
Below is a visual representation of the functionality of a WMS:
Now that you know what a WMS is, how does it relate to cartonization?
Cartonization is a WMS process that assesses each item in an order and uses an algorithm to determine the right packaging. It establishes the right size and number of boxes or cartons needed to ship an order, which can significantly benefit your business.
Cartonization software uses a complex algorithm with specific parameters to determine an order’s most efficient packaging option(s). Some cartonization software solutions use different or extra parameters for their algorithm, but these are the three most common:
Below is a visual example of how cartonization is carried out based on factors:
This benefit is especially important for retailers shipping internationally whose freight costs are already high.
Any retailer moving a high volume of products, especially internationally and through a warehouse, should have a WMS to keep track of and manage inventory. Likewise, any retailer with multiple SKUs and ships orders with combinations of SKUs can benefit from WMS cartonization.
The expense of cartonization may not be worth it if you don’t ship large volumes, but doing some research on budget-friendly software and comparing the cost of it vs. the benefit of it will help you get a better feel of whether or not cartonization would benefit your business.
Now that you know what cartonization is, it’s important to find a cartonization solution that best fits your business. Research and talk to some sales reps until you find the best fit.
Your savings and efficiency could be a game-changer for your business in one year!
A love of bringing words together to create clear, simple messages about complex topics has driven me to pursue a career in professional writing. As the Content Manager at Zonos, I find excitement and purpose in decoding the complex details of cross-border ecommerce.