Dive Brief:

• UPS and Sealed Air Corporation have opened a co-developed Packaging Innovation Center, dedicated to e-commerce logistics innovations, in Louisville, KY on the UPS Supply Chain Solutions campus, near UPS Air Group’s global headquarters, according to a company press release.

• The facility aims to help solve packaging and shipping challenges facing e-commerce retailers, and companies in many other industries, by maximizing efficiency, minimizing waste, reducing shipping costs and increasing brand affinity.

• Packaging innovations on display include an automated system that eliminates the need for outer cartons, which can reduce dimensional weight by as much as 87%; an automated right-sizing system that eliminates empty void space in each box by as much as 60%; and a portfolio of packaging work-cell solutions that improve labor productivity, reduce product damage and create a consistent, enhanced experience for the end consumer.  

Dive Insight:

As the package delivery market continues to undergo a transformational period, UPS has not been hesitant to invest in new technology, nor too inward-focused to work with partners, even startups, that can help it see the market in a new way. UPS, in particular, has paid a lot of attention to efficiency innovations. The goal of improving efficiency has been behind the company's drone delivery tests and its development of its Orion route management software system.

But not all logistics efficiencies have to do with route management and finding the shortest, quickest path to the customer's door. The new center extends UPS' innovative spirit specifically to packaging, as it tries to help its customers break out of the mold set by years of using standard-sized packaging that was never intended to be seen or handled by consumers — something that has completely changed with the evolution of e-commerce.

Some of the packaging issues created by the rise of e-commerce are obvious — such as excessive waste of packaging material. But it has also created more nuanced needs, such as three times logistics space for e-commerce logistics compared with brick-and-mortar operations; the capacity to satisfy a multitude of fulfillment options and fulfillment origination points; a process for lower risk of damage and spoilage; and increased pressure on existing labor resources to produce more, at higher speeds and lower costs, in more complex operational environments.

With a background in sustainability-minded packaging, Sealed Air seems like the right partner for UPS, and along with other efforts by UPS to innovate around package delivery, the existence of a packaging innovation center should help alter any lingering public perceptions that the 110-year-old company can't keep up with the forces of change in its market.