As we leave 2020 behind, we enter 2021 with a number of ambitious scaling goals for Novatropes. Namely, the scaling and transformation from a small bootstrapped startup into an affordable, luxury optical illusion experience brand. One major aspect to this growth is the effort to upgrade packaging from its current, amateurish state to a luxurious and professional unboxing experience. This blog post will cover the process I underwent to build a new link into our supply chain, and the lessons learned along the way.
For those who just want to see the finished result, the video of the final assembly is embedded below.
Supply chain management can be intimidating to learn and frustrating to execute, but if you’re anything like me then having a framework to help guide you can make the difference between success and failure to launch. At the end of the day, suppliers make a living trying to interpret and manifest their customers’ wishes, so being as explicit as possible will reduce margin for misinterpretation or error. Doing your own prototyping work and providing CAD drawings like I did isn’t strictly necessary, but it lets them bypass their own internal design phase and sent it right to whoever is responsible for quoting. For a small company with low order volumes like us, this can be the deciding factor between a successful interaction, and the supplier deciding it’s not worth their time and ignoring your RFQ. Below is the high level flow chart of the phases undertaken during this project.
Our previous packaging schema consisted of a Strobe Dock wrapped in 3-feet of 1/8" polyethylene foam sheet from Uline, then again wrapped in 3-feet of 5/16" bubble roll sheet from Uline. Novatrope sculptures are individually packaged by wrapping them in 1-foot of the same 1/8" polyethylene foam sheet from Uline, and placing them in white indestructo mailers from Uline. The contents of an order are then placed into a 200 lb. test corrugated box from Uline, and all gaps are filled with biodegradable packing peanuts from Uline. To avoid shipping completely unbranded packages, we secured the boxes with branded packing tape from Sticker Mule. A rough breakdown of previous packaging costs is below.
While this schema served its purpose in getting our first thousand or so orders out of the door, there are some notable drawbacks to it, namely:
• Excessive labor required to safely package each shipment• Unappealing/unprofessional unboxing experience for customer• Imperfect protection of box contents resulting in occasional damage during transit
I tend to approach everything in life like an engineering project, which means first laying out desired outcomes and constraints. Once those are clearly quantified, I design a first pass prototype, then run some efficacy tests. Rarely (if ever) is the first prototype totally successful, so a new prototype is made incorporating the lessons learned from the first. This is repeated until all of the design criteria are met, or until I get fed up and call it a day. Whichever comes first.
The most common order placed with us is for a Black Walnut Strobe Dock Kit, which includes the following:
•Black Walnut Strobe Dock • Poly Lotus Novatrope • Fractal Spikes Novatrope • 12V Power adapter • Instruction pamphlet
This is all packaged in accordance with the previous Packaging schema, using a 9"x9"x10" corrugated box from Uline. The contents of the box have a bit of room to spare on all sides which is filled with peanuts, but not much. Occasionally, customers order additional sculptures with a kit, in which case a 12"x9"x10" corrugated box is used. Note: All different Strobe Dock varieties we currently offer are approximately similar in size and weight. Due to the limited amount of capital available for this effort, a single solution must be chosen that suits the most number of use cases possible. For this reason, the new packaging solution should meet the following criteria:
1) Sized to fit a single Strobe Dock Kit (of any variety; Black Walnut, Padauk, or Hex). 2) Minimize unused volume within the box. 3) Minimize operator time required to package orders. 4) Utilize soft foam that prevents damage to fragile contents. 5) Aesthetically pleasing. 6) Luxurious unboxing experience. 7) Ideally costs less than current packaging. If not, then as cheap as possible without violating previous criteria.
Foam Prototype Mk 1
To get the ball rolling and start playing with designs, a box of Pick and Pack perforated open-cell polyurethane Foam Sheets was ordered from Uline, and the following prototype was designed to fit into a 9"x9"x10" box: Lessons learned from this included:
1) The Strobe Dock should be packaged beneath the 12V power adapter and additional Novatrope to keep the Center of Gravity (CoG) low, reducing tippy-ness of the box.2) There was a fair amount of un-used space around the borders. 1/2" from each dimension could be removed and still preserve adequate cushioning of the contents during shipping.3) Traditional glues applied to hold the layers together dried hard and created hard sections that could scratch the contents. This shouldn’t be a problem once a professional suppliers is selected to fulfill orders.
Foam Prototype V2
Using the lessons from the in-person prototype, a CAD model for a new foam prototype was created in SolidWorks to aid in quoting efforts from prospective suppliers. The new design assumed a slightly smaller box at 8.5"x8.5"x9.5" to save space and allow for packaging in a larger shipping box should the customer order additional sculptures.
In an ideal world, selecting a standardized box size will reduce per-unit cost, so ask your supplier if your custom box size will substantially increase production costs, and if so consider using a standard box size. Remember that every square inch of unused space you ship costs you money, which compounds over time. If you’re feeling froggy, a trade study can be run to determine whether the increased cost of a custom box will save you money in the long run due to shipping savings or not. I was not feeling froggy and as it turned out our supplier only ended up charging us a few extra cents per unit for custom sizing.
As with everything in life where you have to interact with and rely on other people, this part was the most tiresome and recursive. When selecting a supplier, it is important to reach out and engage multiple options suppliers simultaneously. It may cost you a bit more to get samples from 3 or 4 companies, but it reduces the odds of your project grinding to a screeching halt if one or more of them just stop responding to emails for a week or two at a time. This happens to me frequently when vetting suppliers, with the notable exception of Chinese suppliers. Those guys and gals are serious about getting business, and I have yet to have a negative experience with one. *knock on wood* My go-to option for locating international suppliers is AliExpress or Alibaba. For those unfamiliar, AliExpress is a bit like Amazon, but connects you with manufacturers instead of resellers, and offers bulk discounts for larger orders. Shipping can be pricey and take from 2-6 weeks though, so don’t expect Amazon Prime speeds. Alibaba is like AliExpress, but exclusively deals in extremely large batch sizes, and offers greater customizability on products. If you want to buy 500 keychains at a 10-50% markup from cost, go to AliExpress. If you want to buy a shipping container full of unprocessed Iron ore, you can find it on Alibaba. Some Alibaba suppliers will sell you a smaller sample batch, but not always. When this happens, just hop over to AliExpress and quite often that same supplier has an account there selling in smaller batches. I initially reached out to a few suppliers on AliExpress for quotes, and quickly realized that shipping costs were going to be astronomical due to the incompressible nature of the foam. So I put together an RFQ (Request for Quote) template and sent it to as many local suppliers as I could find on Google. I also reached out to friends and colleagues and asked for recommendations. Out of the 4 suppliers I reached out to, only 2 responded, and one of those went radio silent a few weeks in. Oh well, good thing I had redundancy! Here’s the template I used:
For the suppliers that responded, their first question was “what are your expected order volumes?” which can be a tricky question to answer. Many suppliers tend to not take smaller companies seriously, as they stand to potentially earn less money than with bigger clients, so asking for a quote on an extremely small quantity is a bad idea. At the other end of the spectrum, with increased volumes come greater price breaks, but asking for too many units can also bite you in the butt, since providing the upfront capital and warehousing the units can be difficult to manage. My strategy is always to ask for price breaks at three tiers. I come up with the highest number of units we expect to sell in a month, then ask for price breaks at quantities that approximately correspond with 1 month, 3 month, and 6 months worth of stock (without explicitly telling the supplier this is what these numbers correspond with). For this order, I requested price breaks at 150 units, 500 units, and 1000 units. This gives you a good understanding of how unit price drops with increased quantity, and shows the supplier that you have the potential to be a profitable client. If you like the numbers you’re seeing, the next step is requesting a sample or prototype. These are sometimes free, but smart suppliers charge for this to weed out non-committal clients (at least for the first sample). Within a week I had a supplier-provided prototype in my hands, which ended up being a little too snug on the Strobe Dock, so I altered tolerances a bit and was happy with the design. Once you’re ready to proceed, ask for a PO (Purchase Order) at the desired amount, and don’t forget to request Reseller Sales Tax Exemption!! The process for acquiring reseller sales tax exempt status varies from state to state, but in Arizona it is as simple as filling out an AZ-5000A form and sending it along with the PO request. Getting double-taxed is a bummer and is easily avoidable so get used to your state’s sales tax exemption process and use it whenever you possibly can.
One of the benefits of sourcing local suppliers is that shipping costs are small or non-existent. Especially if you have a pickup truck, which I do. Once we had the new packaging in house, the next step was to determine exactly how much time the new box was saving us, and use that number in calculating the new packaging costs.
As you can see in the intro video, packaging takes around 120 seconds worst case scenario, giving us the updated table below (note that I have excluded the cost for the foam cutting die as it is a one-time expense that gets absorbed into the per-unit cost over time).
Success! Our upgrade effort met all of the criteria and actually ended up costing less than before. I hope this blog has been interesting, if not helpful to read. Exceeding target goals for projects like this is such a satisfying feeling, and I hope that if you ever find yourself in a similar situation, you meet with success and fulfilment. If you have any additional questions that I failed to cover in this post, please reach out to our email and let me know.