Packaging complexity – How to cope with increasing numbers of small volume SKUs
Portfolios are becoming increasingly complex due to four main drivers:
- Maximising value from current assets
- New products for complex conditions
- Local market requirements
- Commercial advantage
Within the packaging facility, outdated equipment and packing lines down to each module need to be examined, along with line specification versus product requirements, the physical layout of the facility and the effectiveness of supporting business operations.
Packaging techniques such as late stage customisation and postponement may have specific requirements for structural and artwork design, and these might require different solutions to those typically applied.
There are consequences to a company when complexity is not managed appropriately: namely compliance issues, lost commercial opportunities and product unavailability, packaging inefficiencies, support function inefficiencies and obsolescence.
Pharmaceutical packaging operations are generally labour and capital intensive and often a source of senior management frustration:
- They can be expensive in terms of either labour or capital investment, and sometimes both.
- They can often provide non-optimal levels of service, for example long lead times or inappropriate minimum order quantities.
- They can be inflexible with poor utilisation.
To offset these issues, supply chains are forced to either offer poor service levels or carry excessive stock, with the associated issues of high working capital, ageing stock and high write-offs.
A key underlying issue is balancing the demands of the product portfolio to be packed with the capabilities of the packaging facilities utilised. Portfolio complexity is very necessary for many businesses and there are numerous factors that drive increasing complexity, including different legal requirements, increasing customer service demands and product differentiation.
There are ways to effectively address these ch ...