Case Study 1: PBS helped an International FMCG company to get substantial saving in material cost and reduction in material consumption, besides achieving an ROI of 36:1, by developing and optimizing the packaging of one of its Flagship Brand in Pakistan.

An International FMCG company when decided to start the local production of one of its Flagship Brand, they faced a substantial cost increase in its packaging due to pricing from local vendors. It was not feasible for them to absorb this price increase in the product costing.

To resolve the issue, Packaging Business Solutions was assigned the task to review the current packaging, develop it, and source it at a competitive cost.

The main objective of the assignment was to reduce the cost of packaging by identifying the potential areas of cost reduction through the analysis of the company’s current packaging and its purchasing capabilities.

Following the baseline assessment, PBS designed and developed alternate packaging options. Tested these new packaging options in actual supply chain conditions. Identified the suppliers who had the capability to make and deliver the packaging based on pack design and material specifications developed by PBS.

Quotes were obtained and rates were negotiated by PBS based on its Cost Model. Finally a supplier was selected and upon PBS’s recommendation, the purchased order was issued to the supplier for supply of bulk packaging.

The work done by PBS created significant competitive advantage for the FMCG Company by delivering:

  • Improved packaging pricing and commercial terms vs current
  • Cost reduction of over 50% vs current packaging
  • Improved Quality
  • Better service through introduction of capable supplier
  • Group-wide adoption of the “Best Practice” created by PBS

Furthermore, the new packaging design and specifications developed by PBS helped to cut down the packaging material tonnage substantially versus current tonnage. This provided an environmental benefit to the company as well, leading to an improvement on its Carbon Foot Print.