By analyzing the labeling, use of recycled materials and the shape of the bottle, a consumer goods company reduced the cost of shampoo packaging while maintaining the brand image.
The use of product teardowns can extend to a product’s packaging. The challenge is to reduce the cost of a product’s packaging without compromising quality or the brand.
Few companies examine the cost of trade-offs implicit in their packaging decisions, much less look to their competitors for ideas. Such decisions tend to be the domain of marketers, since packaging is a key element of communicating a company’s brand to consumers. Yet we have seen organizations reap considerable savings. One consumer goods maker reduced its packaging costs for a key product by 10% by making straightforward design changes that allowed it to use less plastic in manufacturing the product’s bottle.
This example, based on McKinsey research into packaging and manufacturing costs in the European fast-moving-consumer goods industry, highlights cost trade-offs associated with shampoo.