Thoughts on a Trillion Dollar, World-Impacting Industry
-by Matthew Wright | Founder & CEO
Packaging affects every corner of the globe and has a massive impact on the way we live. Packaging is one of only a handful of industries that if it came to an end the world as we know it would cease to function.
How can I make this claim? My argument is simple: without packaging global trade would shut down.
How would food & beverage, medical supplies, clothing, and other essentials get from the manufacturer to the person who needs theses goods? The global packaging market is growing quickly to a trillion dollar industry with over 220 million different specifications, and yet no one really talks about it or builds tech for it.
Packaging is unique in that it is nearly always custom to each application, and the buyer of the custom packaging, while highly dependent on the outcome, doesn’t control all aspects of the process. It’s the only custom item that companies buy daily that their product is interdependent on.
Everyone agrees that:
- Packaging cost too much
- It’s a complicated process
- The supply chain is complex
- It’s not managed perfectly
- Change is slow
What is interesting is that everyone seems to accept these agreed on points. What is also interesting is that solving these issues benefits everyone from the producer of packaging, user of packaging, retailer, e-commerce, consumer, and the environment.
A lot of time, effort, and money are being poured into process and supply chain improvements. But, we aren’t seeing dramatic change because we have not solved the core issue. The core issue is managing the DNA of packaging – the specification. Bad Specs = Bad Everything.
If you look at the situation in reverse everyone would want the least amount of packaging, most efficient packaging cost, ability to innovate immediately, green packaging that has application, best shelf space utilization, standardization method, common understood process, trucks and distribution systems cubed to 100%, predictability, and an open forum for sharing best practices.
If we choose not to make a marked change then let’s see if the current methods could continue to expand and handle the strains on the systems. To look at this you have to understand what is most relied upon in the packaging world/system, “people.” You can look at this from two perspectives:
- Will the people be available?
- Can their bandwidth grow larger and faster?
It’s interesting that the cost of Packaging Engineers is rapidly increasing which means demand has far outstripped supply. Packaging programs in the US only graduate 1,000 Packaging Engineers each year, which just isn’t enough. Looking for other indicators there are new work groups being started like “specification teams.” This would show that the system is taxed. And all this before the total effect of the baby boomers retirement is felt; today baby boomers are still managing the vast majority of packaging on both the supply side and the buy/use side.
We can also look at the processes used by both suppliers and buyers. Are there common methods that span across types of companies, types of packaging, and countries? No. Is there a common way the whole supply chain comes together? No.
Throwing people at the problem is not working and only getting worse. And, there is no standard method. So how will we conquer this vastly complex packaging world? There is only one place to look – technology and a common platform.
Today, there are too many manual processes, too much paperwork, too many phone calls, too many confusing rules, and almost no modern tech systems and data interchange standards. We’re fixing that. Specright’s mission is to unite the packaging world through technology. By fixing the user experience in packaging, we hope to usher in a world where everyone can speak one common packaging language, things happen with a keystroke, trucks are full, and packaging is more profitable for all.
Matthew Wright ([email protected]) is the Founder and CEO of Specright,
the spec system for the digital world. Matthew has over 25 years of experience in packaging and has held various operational and management roles with International Paper and Temple-Inland. While Vice President for Temple-Inland he ran a $500M business unit.