Cost of Packaging

Whether a cardboard carton, custom plastic mold or bag is used to package a product for consumers, it comes from a packaging manufacturer. Many companies find it much easier to have packages custom designed for their product and buy in bulk. This saves them time and money. They do not have to devote needed production space in their factory to make packages, but this convenience comes at a cost.

The raw materials for manufacturing packaging are bought from wholesale suppliers. These companies provide plastic, paper and board material to companies who create boxes, bags and other packaging items. They charge for these materials and the cost varies. It is dependent on the cost of labor to harvest or gather materials and the cost to ship to the package company. Ink for printing on the packaging is also delivered to the manufacturer and adds cost.

The package manufacturing takes place within a building and uses both a labor force and machinery to construct the packaging materials into a useful form. Leasing fees or mortgages for the building space, utilities and other basic business expenses are part of the cost of packaging. Labor fees for production and machinery maintenance are also part of the cost passed on to the end user of the packaging.

The field of packaging is highly competitive. Making boxes may not seem very important, but it is a necessity for many companies around the world. Boxes, bags and plastic packaging protect consumer goods. They also function as a means to ease the cost of shipping by providing standardized sizes that pack easily in containers. Every packaging company must meet their customer's needs while keeping the cost as low as possible. If prices go up, there are always competitors willing to step in and produce for a lower price. Additional services such as printing customer information on the outside of the packages helps to keep a package manufacturing company competitive in today's market. Keeping shipping costs low is another way these companies compete for business. In the end, the cost of packaging is covered by the consumer who buys the final packaged product.