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Multipack - a growing packaging concept. An analysis of the market, the distributions/handling & cost

Lindskog, Johan and Lundgren, Jessica (1996)
Packaging Logistics
Abstract
Since the markets of multipacks are growing we have examined the multipacks out of the perspective of opinions, handling / distribution times and costs, and cost of producing multipack both in Sweden and the UK. Our aim has been to develop a research model that can be used for future studies of other multitask markets.

The research started with a thorough field study of the Swedish and UK markets to get a picture of existing multipacks. The field study included visiting 32 stores of different sizes in Sweden and 9 stores in the UK. After that, interviews with producers in the UK and in Sweden were made. We also interviewed Swedish retailers and carried out a survey with Swedish consumers.

To get a picture of the distribution and handling... (More)
Since the markets of multipacks are growing we have examined the multipacks out of the perspective of opinions, handling / distribution times and costs, and cost of producing multipack both in Sweden and the UK. Our aim has been to develop a research model that can be used for future studies of other multitask markets.

The research started with a thorough field study of the Swedish and UK markets to get a picture of existing multipacks. The field study included visiting 32 stores of different sizes in Sweden and 9 stores in the UK. After that, interviews with producers in the UK and in Sweden were made. We also interviewed Swedish retailers and carried out a survey with Swedish consumers.

To get a picture of the distribution and handling in stores we studied the handling events from unloading to cash registering. This study was also used as a foundation for the DPCC (Direct Packaging Concept Cost) study performed in one store in each market. In addition, cost of producing multipacks has been calculated by the help of MECA ( Multipack Equipment Cost Analysis).

The presentation of the results from the two markets are presented in two separately chapters and are not compared.

SWEDEN

In the Swedish market the most common multipack for stilldrinks is the 3-pack 200 Slim, 200 Base and 250 Base with clear film. The level of knowledge among producers and retailers about the multipack concept is low. The retailers are pretty much guided by the assortment offered by the producers, The consumer attitude towards the multipack is positive. The Swedish consumers? strongest arguments for buying multipack are the discounted price on the multipacked product.

The difference between singlepack and multipack is easily seen in the handling in store. A lot of time and money can be saved by using multipack. Most multipacks in the Swedish stores are placed on pallets directly on the floor, but multipacks are also found on the shelves.

The far most time consuming event for the store concerning singlepacks and multipacks are cash registering. Considerable time savings compared to the singlepack can also be made when placing the multipack on the shelf and restoring it. The time saving is even greater when using 9-pack instead of 3-pack. Placing the items on floor takes less time and therefore costs less than placing on shelf.

The calculations, we have made in MECA, concerning costs of producing a multipack in Sweden are based on following:

? 3-pack with PE clear film both in TMS 63 and TMS 72 and with label applicated by Rotakett Barcode Applicator.

? 3-pack with PE pre-printed film in TMS 72.

? 9-pack with PE clear film both in TMS 63 and TMS 72 and with label applicated by Rotakett Barcode Applicator and handle applicated by Tetra Handle Applicator 22. ? 9-pack with PE pre-printed film in TMS 72 and with handle applicated by Tetra Handle Applicator 22.

The material cost for pre-printed film is 650% more expensive than the clear film, but still the total production cost difference when including labels is not at all that large. The single package in a 3-pack with pre-printed film in TMS 72 is 33% more expensive than the 3-pack with clear film from the same multi shrink machine. The same figure for the 9-pack is 7,5%. When using PE clear film the TMS 72 is the cheapest alternative both for 3-pack and 9-pack.

The calculations made by the help of DPCC is based on data from the hypermarket OBS in Burlöv. It has been performed with Tetra Brik 250 Base in singlepack, 3-pack and 9-pack on floor, shelf and in refrigerated display.

According to the DPCC study, independent of placing, the 9-pack is the most cost efficient packaging concept. The totally most cost efficient placement for all packaging concepts are on the floor. The largest expenditures for the store concerning singlepacks and multipacks are cost of order and handling.

As a conclusion we have shown that in the total cost chain from producer to consumer there are cost savings to be made when using multipack. The largest total savings are made when using 9-pack.

THE UNITED KINGDOM

The most common multipacks for portion packed juices and stilldrinks are Tetra Brik 200 slim and 250 base and slim with pack pattern 3x1 and 3x3. 3x1 is usually packed in shrink film, while 3x3 uses either pre-printed film or board wrap. The most common multipacks for juices in Tetra Brik 1000 ml are 1x3 and 2x2 with board wrap. In Tetra Brik milk is found in 4-pack, 6-pack and 8-pack. Overall the most common multipack material is board wrap.

Multipacks as a concept is chosen by the producers particularly because of marketing reasons - the larger display face and the convenience the customers are offered. Aspects like freshness, flexibility, costs and easiness of handling and storing have a large impact on the consumers? attitude towards multipacks.

The largest handling time savings for multipack versus singlepack are made within the events:

placing on shelves, restoring items and cash registering. The time for these events is 1/6 of the total time when handling Tetra Brik 250 Base 9-pack compared to the singlepack.

The calculations with MECA in the UK are based on:

? 3-pack with PE clear film both in TMS 63 and TMS 72 and with label applicated by Rotakett Barcode Applicator.

? 3-pack and 9-pack with PE pre-printed film in TMS 72.

? 9-pack with board wrap in Certipak Field

? 9-pack with board wrap in CP-50 Mead

The cost of the 3x1 250 Base multipack using pre-printed is 32% more expensive than the multipack out of PE clear film in TMS 72 including label. The total cost of manufacturing the 9-pack out of pre-printed is 40% of the manufacturing cost for board wrap no matter board wrap machine.

The DPCC study is based on data from unloading to cash registering at a supermarket located outside London. It has been performed with Tetra Brik 250 Base in singlepack, 3-pack and 9- pack and Tetra Brik 1000 Base singlepack and 4-pack both for item and tray stocking.

Item stocking means a decreased total cost of 25% per 250 B package in a 3-pack and 44% in a 9-pack compared to the singlepack. The differences anse due to the increased time when cash registering and stocking the multipack compared to the singlepack. The total costs decrease with 21% per 1000 Base package in a 4-pack compared to the singlepack when item stocked.

To reach total economical efficiency with film there needs to be larger multipacks than the 3- pack to split the costs. In the total cost chain from producer to consumer there are cost savings to be made when using 9-pack with pre-printed film. To get the 9-pack with board wrap cost efficient is hard. (Less)
Please use this url to cite or link to this publication:
author
Lindskog, Johan and Lundgren, Jessica
supervisor
organization
year
type
H2 - Master's Degree (Two Years)
subject
keywords
Multipack, packaging, distribution, Technological sciences, Teknik
language
English
id
1318779
date added to LUP
2008-06-03 00:00:00
date last changed
2010-02-01 14:40:04
@misc{1318779,
  abstract     = {Since the markets of multipacks are growing we have examined the multipacks out of the perspective of opinions, handling / distribution times and costs, and cost of producing multipack both in Sweden and the UK. Our aim has been to develop a research model that can be used for future studies of other multitask markets.

The research started with a thorough field study of the Swedish and UK markets to get a picture of existing multipacks. The field study included visiting 32 stores of different sizes in Sweden and 9 stores in the UK. After that, interviews with producers in the UK and in Sweden were made. We also interviewed Swedish retailers and carried out a survey with Swedish consumers.

To get a picture of the distribution and handling in stores we studied the handling events from unloading to cash registering. This study was also used as a foundation for the DPCC (Direct Packaging Concept Cost) study performed in one store in each market. In addition, cost of producing multipacks has been calculated by the help of MECA ( Multipack Equipment Cost Analysis).

The presentation of the results from the two markets are presented in two separately chapters and are not compared.

SWEDEN

In the Swedish market the most common multipack for stilldrinks is the 3-pack 200 Slim, 200 Base and 250 Base with clear film. The level of knowledge among producers and retailers about the multipack concept is low. The retailers are pretty much guided by the assortment offered by the producers, The consumer attitude towards the multipack is positive. The Swedish consumers? strongest arguments for buying multipack are the discounted price on the multipacked product.

The difference between singlepack and multipack is easily seen in the handling in store. A lot of time and money can be saved by using multipack. Most multipacks in the Swedish stores are placed on pallets directly on the floor, but multipacks are also found on the shelves.

The far most time consuming event for the store concerning singlepacks and multipacks are cash registering. Considerable time savings compared to the singlepack can also be made when placing the multipack on the shelf and restoring it. The time saving is even greater when using 9-pack instead of 3-pack. Placing the items on floor takes less time and therefore costs less than placing on shelf.

The calculations, we have made in MECA, concerning costs of producing a multipack in Sweden are based on following:

? 3-pack with PE clear film both in TMS 63 and TMS 72 and with label applicated by Rotakett Barcode Applicator.

? 3-pack with PE pre-printed film in TMS 72.

? 9-pack with PE clear film both in TMS 63 and TMS 72 and with label applicated by Rotakett Barcode Applicator and handle applicated by Tetra Handle Applicator 22. ? 9-pack with PE pre-printed film in TMS 72 and with handle applicated by Tetra Handle Applicator 22.

The material cost for pre-printed film is 650% more expensive than the clear film, but still the total production cost difference when including labels is not at all that large. The single package in a 3-pack with pre-printed film in TMS 72 is 33% more expensive than the 3-pack with clear film from the same multi shrink machine. The same figure for the 9-pack is 7,5%. When using PE clear film the TMS 72 is the cheapest alternative both for 3-pack and 9-pack.

The calculations made by the help of DPCC is based on data from the hypermarket OBS in Burlöv. It has been performed with Tetra Brik 250 Base in singlepack, 3-pack and 9-pack on floor, shelf and in refrigerated display.

According to the DPCC study, independent of placing, the 9-pack is the most cost efficient packaging concept. The totally most cost efficient placement for all packaging concepts are on the floor. The largest expenditures for the store concerning singlepacks and multipacks are cost of order and handling.

As a conclusion we have shown that in the total cost chain from producer to consumer there are cost savings to be made when using multipack. The largest total savings are made when using 9-pack.

THE UNITED KINGDOM

The most common multipacks for portion packed juices and stilldrinks are Tetra Brik 200 slim and 250 base and slim with pack pattern 3x1 and 3x3. 3x1 is usually packed in shrink film, while 3x3 uses either pre-printed film or board wrap. The most common multipacks for juices in Tetra Brik 1000 ml are 1x3 and 2x2 with board wrap. In Tetra Brik milk is found in 4-pack, 6-pack and 8-pack. Overall the most common multipack material is board wrap.

Multipacks as a concept is chosen by the producers particularly because of marketing reasons - the larger display face and the convenience the customers are offered. Aspects like freshness, flexibility, costs and easiness of handling and storing have a large impact on the consumers? attitude towards multipacks.

The largest handling time savings for multipack versus singlepack are made within the events:

placing on shelves, restoring items and cash registering. The time for these events is 1/6 of the total time when handling Tetra Brik 250 Base 9-pack compared to the singlepack.

The calculations with MECA in the UK are based on:

? 3-pack with PE clear film both in TMS 63 and TMS 72 and with label applicated by Rotakett Barcode Applicator.

? 3-pack and 9-pack with PE pre-printed film in TMS 72.

? 9-pack with board wrap in Certipak Field

? 9-pack with board wrap in CP-50 Mead

The cost of the 3x1 250 Base multipack using pre-printed is 32% more expensive than the multipack out of PE clear film in TMS 72 including label. The total cost of manufacturing the 9-pack out of pre-printed is 40% of the manufacturing cost for board wrap no matter board wrap machine.

The DPCC study is based on data from unloading to cash registering at a supermarket located outside London. It has been performed with Tetra Brik 250 Base in singlepack, 3-pack and 9- pack and Tetra Brik 1000 Base singlepack and 4-pack both for item and tray stocking.

Item stocking means a decreased total cost of 25% per 250 B package in a 3-pack and 44% in a 9-pack compared to the singlepack. The differences anse due to the increased time when cash registering and stocking the multipack compared to the singlepack. The total costs decrease with 21% per 1000 Base package in a 4-pack compared to the singlepack when item stocked.

To reach total economical efficiency with film there needs to be larger multipacks than the 3- pack to split the costs. In the total cost chain from producer to consumer there are cost savings to be made when using 9-pack with pre-printed film. To get the 9-pack with board wrap cost efficient is hard.},
  author       = {Lindskog, Johan and Lundgren, Jessica},
  keyword      = {Multipack,packaging,distribution,Technological sciences,Teknik},
  language     = {eng},
  note         = {Student Paper},
  title        = {Multipack - a growing packaging concept. An analysis of the market, the distributions/handling & cost},
  year         = {1996},
}