It’s understandable for businesses to feel perplexed in a changing trade environment. This article cuts through the noise to help you make smarter, more strategic packaging decisions amid the ongoing tariff crisis.

Read more: How can Packaging Industry cope with Trump Tariffs?

Impact of Tariffs on Packaging Buyers

Sudden Price Hikes

Many small businesses with tighter budgets have traditionally sourced directly from Chinese packaging manufacturers due to their competitive pricing. But when U.S. President Donald Trump imposed a 145% tariff rate on Chinese goods in early April, packaging costs surged overnight. Since the buyers—the U.S. businesses—are responsible for paying these import duties, the financial burden hit fast and hard.

Even if you’re sourcing packaging from U.S.-based suppliers, you’re not entirely immune to tariff-related costs. That’s because many local packaging companies rely heavily on imported materials from China or manufacture there. As the new tariffs lead to higher costs in production, those increases are often passed down to their customers, meaning your business still ends up footing the bill.

Fewer Packaging Supplies and Options

Tariff disruptions to global supply chains are creating significant uncertainty in packaging supplies. Many packaging companies now face logistics challenges in sourcing raw materials or shipping finished goods, which can leave you waiting on critical packaging orders—and ultimately, put your sales at risk.

To manage limited inventory, suppliers may reduce the variety of packaging options they offer. This means fewer customization choices for your brand. On top of that, with profitability squeezed by tariffs, many custom packaging companies face existential threats. As more suppliers are forced to scale back or close their doors, premium custom packaging options could become increasingly scarce for brands.

Decline in Consumer Demand

With packaging costs rising due to steep tariffs, many brands are left with no choice but to raise prices. Unfortunately, higher prices can reduce customers’ willingness to buy, potentially hurting both sales and hard-earned customer loyalty.

Economists warn that the ongoing trade war could trigger a recession. The uncertainty surrounding the global economy particularly impacts demand for premium products with customized packaging, as consumers tend to prioritize essential purchases during challenging financial times, making your investment in high-quality packaging less effective at driving sales.

What Businesses Can Do

1. Review Your Packaging Supplier

If you’re currently buying packaging from China or from suppliers that only manufacture there, you may already be feeling the pressure to make a change.

As global trade dynamics continue to shift, your sourcing strategy should evolve accordingly. Price alone shouldn’t be the deciding factor anymore. Agility and flexibility are just as important. Look for suppliers with multiple manufacturing locations across other countries. This gives you more options and greater stability in the face of sudden tariff changes.

Transparency is also key. A good supplier should be open about their exposure to tariffs, their cost projections, and the state of their supply chain. Ask the right questions:

• What is their strategy for managing tariffs?
• Do they have contingency plans in place for long-term disruptions?

The more you know, the better prepared you’ll be to partner with a supplier that can weather uncertainty alongside your business.

2. Supplier Collaboration and Negotiation

Whether you’re seeking alternative suppliers or sticking with your current one, it’s essential to work together proactively to manage the cost increases caused by tariffs.

Start by negotiating more flexible contract terms, such as extended payment timelines to help ease cash flow pressures. You can also request volume discounts on bulk orders or explore bundled services that help lower your total costs.

Remember, most packaging companies are facing the same challenges in this volatile market. Open, honest communication can lead to solutions that benefit both sides. A strong supplier relationship built on transparency and collaboration can help both parties survive and even thrive during this difficult period for the entire industry.

3. Optimizing Packaging Design

Beyond renegotiating supplier terms, collaborate with your packaging designer to strategically restructure your packaging for greater cost efficiency. Here are a few tactics:

• Lightweighting: Reduce the thickness or weight of your packaging materials. This not only cuts down on material usage but can also reduce tariff exposure and shipping costs. Keep in mind, though, that it may require careful testing to maintain adequate product protection.
• Right-sizing: Adjust packaging dimensions to better fit the product. By minimizing excess material and void space, you can lower both material costs and dimensional shipping charges.
• Simplification: Streamline your packaging by using fewer materials or components. This can help lower production costs, simplify assembly, and even improve recyclability.
• Material substitution: Swap out materials for alternatives sourced from low-tariff or tariff-free regions. For example, switching to domestically sourced recycled materials can promote sustainability while helping manage costs.

Whichever approach you take, it will likely require additional R&D to ensure that your new design maintains product integrity and aligns with your brand standards. But when done right, these changes can significantly reduce long-term packaging expenses.

4. Integrate Tariff Costs into Planning 

Passing increased costs directly to your customers may seem like the simplest solution, but it risks damaging customer satisfaction and hurting sales.

Instead, businesses should take a strategic approach. Factor potential volatility in packaging costs into your broader pricing strategies, margin planning, and financial forecasts. This helps ensure your business remains profitable even as trade conditions shift.

Leverage forecasting tools—especially those powered by AI—to better manage packaging inventory. By predicting demand and monitoring tariff trends, you can place strategic orders in advance and avoid supply chain disruptions. Planning ahead gives you a competitive edge and helps protect your bottom line in uncertain times.

Explore Tariff-Free Packaging Solution with PakFactory

Amidst global trade challenges, PakFactory is here to help your business stay resilient. We provide end-to-end support to minimize tariff exposure and ensure your packaging strategy stays cost-effective and competitive:

Find the Best-Fit Manufacturer

We source the right suppliers for your needs across Asia and North America, even beyond our current network, to ensure your packaging meets quality, budget, and tariff requirements.

Plan Logistics from Freight to Delivery

We manage all customs paperwork and logistics planning to streamline your supply chain, prioritizing speed, cost-efficiency, and regulatory clarity.

Optimize Design for Tariff Efficiency

Our experts review your packaging specs from materials to structure, identifying opportunities to reduce costs without compromising quality or brand experience.

Monitor Shipment and Tariff Policy Shifts

We stay hands-on throughout your entire project, monitoring your shipments and flagging trade policy changes early, so you’re never caught off guard.

Keep You Informed at Every Stage

Transparency is our promise. You’ll receive clear cost breakdowns and timely updates, so you always know what’s happening and how it affects your order.

Understanding today’s tariff landscape helps you make informed decisions for your packaging strategy. The businesses that thrive will be those that adapt quickly, optimize their approach, and align with knowledgeable, agile suppliers.

With PakFactory’s expertise, you can turn market challenges into strategic advantages. Consult with our specialist now to find a tariff-free packaging solution tailored to your brand.

This escalating conflict is causing global supply chain disruption. Few industries feel the pressure more than packaging, which relies heavily on imported raw materials and overseas manufacturing—much of it rooted in China.

In this article, we’ll break down the impact of tariffs on packaging companies and manufacturers, and explore what practical strategies the industry can adopt to navigate through the storm.

What Are Tariffs?

Let’s start with the basics. A tariff is a tax imposed by a government on imported goods.

Tariffs are typically used to protect domestic industries by making foreign products more expensive, thereby encouraging consumers to buy locally made alternatives. They also serve to generate government revenue, reduce trade deficits, encourage domestic production, or apply pressure in diplomatic negotiations.

But who actually pays the tariff? Contrary to common belief, it’s not the foreign exporters footing the bill—it’s the importing companies, in this case, the American businesses, that are responsible for paying these taxes. While businesses may attempt to absorb some of the costs, tariff-related expenses are often passed down the entire supply chain, ultimately leading to higher prices for consumers.

For packaging companies operating in today’s global marketplace, understanding these tariff mechanics is the first step toward developing effective mitigation strategies.

U.S. Tariff Rates on General Imported Goods by Country (Updated May 12, 2025)

*Donald Trump announced a 90-day pause on the “reciprocal” tariffs until July 9, 2025, only imposing 10% baseline tariffs on most countries, except China, Mexico, and Canada.

^#The U.S. and China announced a 90-day pause in tariffs starting May 14, 2025. US tariffs on Chinese imports are reduced from 145% to 30%, and Chinese tariffs on US goods fall from 125% to 10%.

Note: This table does not include tariffs that were in place before 2025, or any sectoral or section-specific tariffs (e.g., steel and aluminum)

How Are Tariffs Affecting Packaging Industry?

1. Increased Costs

The Trump tariffs directly affecting both raw materials and packaging costs, have created a storm of rising expenses for the packaging industry in several ways:

Raw Material Price Surges

Many packaging manufacturers in the U.S. rely heavily on imported raw materials, including steel, aluminum, paper, and plastics. Smaller packaging companies, in particular, often outsource their production to Chinese factories due to lower labor and manufacturing costs. When global imported goods—including those from China, Mexico, and Canada—got hit with high tariff rates, material costs increased significantly.

Compounding Costs Through Complex Supply Chains

Packaging production is already a complex, multi-step process. It often involves a global supply chain where raw materials and intermediate goods cross borders multiple times. For example, pulp sourced from the U.S. may be sent to Europe for paperboard production, which is then shipped to China for packaging manufacturing, and finally exported back to the States. With tariffs potentially applied at each border crossing, costs can multiply quickly through the supply chain.

Logistics and Warehousing Expenses

Beyond direct material costs, supply chain disruptions and logistics challenges contribute to rising costs. Some companies pay more to expedite shipments before tariff implementation deadlines, while others incur extra expenses storing materials in the country of origin in hopes that tariff policies may ease.

Administrative Burden

The complexity of navigating tariff regulations has itself become a substantial expense. Companies must now dedicate significant resources to analyze evolving trade policies, calculate the impact on margins, and seek alternative suppliers. Many packaging businesses have found it necessary to engage external legal and customs expertise—an additional cost that particularly burdens smaller firms.

2. Decline in Profitability

With tariff-related costs increasing, profit margins across the packaging industry are under intense pressure. This is particularly alarming for small to medium-sized businesses, which often operate on tighter margins and have less financial flexibility to absorb these added expenses.

The impact can be severe. Industry estimates suggest that a 25% tariff could eliminate profit margins entirely for certain companies in the printing sector—a field closely tied to packaging. Similarly, the National Association of Manufacturers (NAM) has warned that a 25% tariff on imports from Canada and Mexico alone could add up to $144 billion annually to U.S. manufacturing costs. Small and mid-sized enterprises are expected to bear the brunt of this financial strain.

As profitability shrinks, businesses are forced to make tough decisions—whether it’s scaling back investments, delaying product development, or even reducing headcount. In a highly competitive market, such measures can threaten business viability.

3. Further Disruptions from Retaliatory Tariffs

As the trade war drags on with no end in sight, economists are sounding the alarm on broader economic fallout. Leading brokerage J.P. Morgan has raised the probability of a global recession this year from 40% to over 60%—largely due to mounting trade tensions.

Retaliatory tariffs are compounding the problem. China’s tariffs imposed on U.S. goods are directly impacting American agricultural exports, which in turn reduces demand for packaging solutions. This ripple effect is felt throughout the packaging supply chain.

The climate of uncertainty hinders business development. With trade policies constantly evolving and their duration unknown, packaging companies face difficulty in making confident long-term decisions. Important investments in production capacities, technological innovations, and new product development get postponed or even canceled. The result? A serious threat to the industry’s long-term growth and competitiveness.

Mitigation Strategies of the Packaging Industry

1. Adjusting the Supply Chain

Optimizing Inventories

Some packaging companies might have strategically stockpiled imported materials before the tariffs took full effect. By optimizing the use of these inventories, companies can create a short-term buffer against sudden cost increases. This is often the quickest and most cost-effective strategy for mitigating the initial impact of tariffs.

However, this approach isn’t feasible for everyone. Smaller businesses, which typically operate with tighter budgets and limited warehousing capacity, may not have the means to stockpile large inventories. Even for larger companies, this is a temporary fix rather than a long-term solution.

Looking ahead, the industry can take a more proactive inventory management approach, by leveraging advanced market demand forecasting and supply chain analytics. By predicting potential tariff fluctuations, companies can time their purchases more strategically, and build up reserves of critical materials during periods of price stability and ahead of known tariff deadlines.

Sourcing Suppliers from Other Countries

Reducing reliance on high-tariff regions like China is a key strategy for mitigating tariff impacts. By diversifying the supply chain and sourcing packaging materials or manufacturing services from countries with lower tariff rates—such as Vietnam, Malaysia, or other parts of Southeast Asia—packaging companies can lower their exposure to trade tensions.

However, this approach comes with other challenges. Identifying reliable alternative suppliers takes time, and building strong partnerships requires careful vetting, supplier contract negotiations, and long-term relationship management. The process is resource-intensive and not without risk.

Moreover, even if production is shifted to lower-tariff regions, the complexity of global supply chains means materials often still need to cross multiple borders. As seen in earlier examples, if tariffs are imposed at several stages of the production and distribution process, costs can quickly rack up.

Despite these challenges, developing a more geographically diverse supplier network remains a valuable strategy. It provides both immediate operational cost relief and long-term supply chain resilience against future tariff-induced disruptions.

Manufacturing in the U.S.

Another strategy is to shift sourcing and production back to the U.S.—a move aligned with one of the Trump administration’s core objectives: revitalizing domestic production. This approach offers the clear benefit of completely eliminating tariff exposure. However, the reality is far more complex.

The U.S. currently lacks the raw material capacity to meet the full demands of the packaging industry. Increased demand for domestically sourced, tariff-free materials would likely drive prices up even further. Moreover, domestic producers of packaging are still relatively limited—particularly when it comes to customization.

Custom packaging often requires specialized equipment, molds, and dies, all of which come with high upfront costs. Combined with higher labor costs and facility overhead, manufacturing in the U.S. might even end up with higher production costs than importing from China—even with tariffs included.

While reshoring may hold long-term potential, it’s not a quick or easy fix. Building sufficient domestic capacity would require years of investment, infrastructure development, and workforce training.

2. Re-engineering Packaging Products

Beyond reconfiguring the supply chain, packaging companies can also navigate tariff challenges by making strategic changes to packaging design.

Material substitution is a practical starting point. By selecting alternative materials that are more readily available domestically or that carry a lower cost per unit, companies can significantly reduce their exposure to tariffs. A notable example comes from beverage giant Coca-Cola, which considered shifting more of its packaging from aluminum cans—subject to steep aluminum import tariffs—to plastic bottles, which are often cheaper and easier to source.

Companies can also lean into innovation in sustainable materials. Options like advanced paper coatings, bioplastics derived from non-tariffed agricultural feedstocks, or packaging made from recycled content (such as PCR plastics or recycled paper fibers) offer dual benefits: cost mitigation and alignment with growing consumer demand for eco-friendly packaging.

Another effective strategy is structural redesign. By revisiting product specifications—reducing dimensions, minimizing material use, or consolidating format variations—packaging companies can drive down costs, improve production efficiency, and optimize shipping.

Ultimately, thoughtful design adjustments not only help offset tariffs but can also position brands as more agile and sustainability-minded under the challenging global trade dynamics.

3. Passing Cost to Clients

The most straightforward—but perhaps least desirable—response to rising tariff-related expenses is passing the cost on to clients. Large packaging companies like Amcor have publicly acknowledged this approach, stating that tariff-driven cost increases could be transferred downstream when necessary.

However, the ability to pass on these costs is often constrained by market dynamics. The packaging sector is intensely competitive, and smaller firms, in particular, lack the pricing power to adjust rates without risking client relationships.

Downstream businesses that purchase packaging, like consumer packaged goods companies and food producers, are typically resistant to price hikes. They worry that increased packaging costs will ultimately be passed on to end consumers, who may push back or turn to cheaper alternatives. This reluctance is even more pronounced during periods of economic uncertainty triggered by a prolonged trade war.

For most packaging companies, cost transfer is just one component of a balanced response strategy rather than a complete solution. Industry stakeholders should combine selective price adjustments with the supply chain modifications and product re-engineering approaches discussed earlier.

Be Prepared to Face the Challenges

The trade war shows no signs of easing, and the packaging industry must remain agile, resilient, and proactive in navigating this evolving landscape. Rising costs, disrupted logistics, and ongoing uncertainty are now part of the new normal, making flexibility and strategic planning more important than ever.

For small and medium-sized businesses concerned about the impact of shifting trade policies, PakFactory is here to help. With a robust global supply chain and long-standing partnerships with international manufacturers, we’re uniquely positioned to offer agile, cost-effective packaging solutions—even in the midst of geopolitical tensions.

Let’s work together to find the right tariff-free packaging strategy for your business. Consult with a packaging specialist today.

Because of this, businesses tend to opt for stock packaging that doesn’t necessarily do their brand justice and in turn hurt their reputation.

The purpose of custom packaging is to bring your branding to the forefront and make an impact that your target market will find hard to forget. 

This is difficult to do with stock packaging that your competitors are likely also using. 

The cost of custom packaging can be a little mysterious especially if you are not familiar with the industry and what factors can affect your costs.

Truth be told, the costs lie in your hands and you have the power to make sure it fits within your budget! 

The first step to determining your custom packaging costs would be to establish the type of product you are selling. 

This could include;

• Luxury Products
• Cosmetics
• Food
• Electronics
• Or anything really!

Determining what industry your product will be serving will allow you to narrow down your choices and in turn get a better understanding of what your costs will entail. 

This includes determining how you will be serving your industry niche. 

Making a distinction between e-commerce and retail packaging will also affect your pricing options drastically as these packaging solutions will be serving different purposes.

Furthermore, determining your time frame of your product launch will also have an impact on your costs as some packaging solutions can take more time and care to produce, such as rigid packaging. 

Once these factors are determined, you can start comparing the core cost considerations for your custom packaging below.

The Cost of Materials and Finishes

The first cost when evaluating your expenses for custom packaging will be the material and finish. 

This will narrow down your options when you determine your structural design and printing costs.

There are a variety of materials to choose from, which vary in price. After all, most of your expenses will cover sourcing and shipping your packaging materials to you. 

Here is a price list estimation for you to refer to:

Depending on your product launch plan, you may want to consider opting for more cost effective packaging, as they are much more time efficient to produce.

Sometimes, opting for the highest quality packaging materials isn’t the best way to optimize your custom packaging.

You need to distinguish between what you ‘want’ vs. what you ‘need’.

Think of it this way; you may want to have an original Picasso on your wall, but you don’t necessarily need it, a printed replica will have the same effect.

So, if you’re running a smaller business, it’s best to find a custom packaging company that will optimize your costs and provide you with the minimum order you need!

There are many cost effective material options that will communicate your brand narrative just as well as the highest quality packaging will.

As discussed previously, the industry your product is serving and how it is serving it will help you determine the material and finish of your custom box.

Once that’s decided, you’ll need to settle on a volume of custom packaging required.

Smaller boxes tend to be cheaper to produce and ship, but larger boxes can also be cost-effective depending on the minimum order. 

In general, you will be paying less per unit the larger your order is, some materials simply offer cost effective small orders while other materials may not. 

Let’s explore and evaluate your material and finishing options and their costs.

Keep in mind; Manufacturers will not advise you on material optimization. However, solution providers will help you optimize on your costs based on your product needs. 

Corrugated

The safest option, corrugated, remains a popular material choice for custom packaging because of its durability and low cost.

They are easy to assemble, work for a large variety of products and are cost effective to produce, making them a more versatile option to consider for your material choices.

Corrugated packaging is a popular option for e-commerce businesses as they are cost/time effective and sustainable to produce. 

Its thick texture offers support to heavier items while also offering optimal protection to your more fragile items.

Furthermore, Corrugated packaging offers a large variety of finishing opportunities for you to consider.

These include;

Varnish

For small to medium-sized corrugated projects, gloss varnish is recommended to increase production efficiency, generate a faster turnaround time and generate an overall lower unit cost.

Lamination

A laminated coating provides your box with the ultimate protection of your artwork, but can sometimes be pricey depending on how much of your budget you allocate to each aspect of your project. 

Wax Coatings

Wax coatings are cost effective and water/grease resistant. This coating may only be necessary if you are packaging food or medical products. Keep in mind that because corrugated packaging is made from organic materials, you do not need a wax coating to package food and medicine safely. 

While finishing options for corrugated packaging are available, this doesn’t necessarily mean you have to opt for one or the other, you can choose to opt for none at all. 

Choosing no coating for your packaging in turn keeps your corrugated packaging costs low. 

Keep in mind, corrugated packaging may not be a necessity if your products are not very prone to breakage.

Folding Carton (White and Kraft)

Folding Carton is an excellent choice for those looking to save on cost and products that do not require a high level of support and protection.

If you’re looking to pay low shipping costs, folding cartons are your best bet because it is lightweight, allowing for larger orders for less costs.

Bear in mind, kraft paperboard tends to be a bit higher in cost than SBS white paperboard, so you’ll want to make a note of these cost differences when evaluating your custom packaging options.

Kraft is produced straight from the source, giving it it’s texture and feel, making it a little pricier than SBS white paperboard. 

SBS white paperboard is made from bleached recycled paper, making it a little bit more affordable as it is a reused material.

The coating process of SBS white paperboard offers a surface for high quality printing and finishing that allows you to showcase your brand identity.

Although Folding Carton is your cost effective option, it still allows for a luxurious high end feel through its printing and finishing capabilities and of course your branding! 

Because of folding carton’s versatile nature and cost effectiveness, you can afford to splurge a little on special finishes and coatings. 

The finishes include, but are not limited to;

Lamination

Laminated paperboard boxes are widely regarded to have the best quality, but are typically more expensive due to its protective properties. Long-run projects typically prefer to use lamination due to their longevity and dust resistance.

UV & AQ Semi-Gloss Finishing

If you’re looking for a less expensive option, you might want to consider low gloss AQ coating. Since AQ Semi-Gloss is water-based, it is a food-safe alternative. 

Opting for Kraft and an AQ UV finish will keep your folding carton costs lower. However, the price difference isn’t so drastic that you can’t opt for white kraft to enhance printing and artwork designs. 

Rigid boxes

Rigid is for those looking to spend a little extra on their packaging.

If you’re looking for something high-end and sturdy, rigid boxes are the best option for you. It is also the priciest option on the market. 

They are often used with luxury products to add a premium feel to packaging and an elevated customer experience.

To put it simply, rigid packaging consists of the highest quality, thick greyboard and it’s final construction is done by hand. 

Rather than printing a simple dieline that allows you to fold your packaging accordingly, rigid packaging is constructed by glueing each edge and surface together by hand.

The construction of your packaging is the main reason for the premium price of this material. It also takes the longest to produce. 

With luxury packaging come special finishes and coatings. 

Matte Lamination

Matte lamination is the most recommended coating for luxury boxes. It emulates luxury for not much of your budget. 

Specialty Coatings

If you simply have more than enough of your budget to invest in packaging design that requires more unique elements, you can also opt for special coatings. 

These types of coatings are recommended for long-run orders due to its extra costs. However, if budget isn’t a problem, why not!

• Textured paper
• Embossed and Debossed
• Pearlized coating
• Glittered
• Reticulated
• Scented
• Foil Stamped

While rigid packaging is in fact the priciest packaging option, there are ways to reduce your costs for this type of material.

Opting for minimalistic artwork designs will help you refocus your budget to save on unnecessary costs for premium packaging.

Additional Packaging Materials

To avoid any hidden costs for your packaging, let’s also look into some additional packaging materials your products may need. 

Some products may need extra support, especially during shipping, handling or stocking.

Of course this is also highly dependent on your product and distribution method. 

Box Inserts

Box inserts are a cost effective way to add an extra layer of support and protection for your products.

Box inserts are available in;

• Carton (bleached and SBS white paperboard) – The cheapest option and less protective but still offers structure as well as printing and finishing capabilities. Kraft is slightly pricier than SBS paperboard. 

• Corrugated – Cost effective and offers printing and finishing capabilities, if you are looking to print on the interior of your packaging. 

• Blister – Plastic and non recyclable, it is molded to your products’ shape and size. However it is less cost effective to produce

• Foam – A pricier option on this list, foam inserts offer optimal cushioning to your products and are often used for luxury products. 

• Molded Pulp – The most expensive option on this list, molded pulp inserts are molded to your products and are 100% recyclable.  Molded pulp was once a cost effective box insert option. However, with the spike in eco-conscious shoppers, they have now become very expensive as they are made from raw material. 

The Cost of Structural and Artwork Design Services

You may already have a design and structure ready for your packaging. 

If this is the case this cost consideration may not be relevant to you. 

However, if this is your first time creating custom packaging, you most likely will need artwork and structural design services to help you construct your packaging project. 

It’s important to note that manufacturers will not help you source these services, it will be up to you to source them yourself. 

This can lead to higher costs in the long run as you are paying a variety of different companies a premium to create your packaging.

Solution providers will be able to help with full project management including cost optimization as well as artwork and structural design services. 

By paying a solution provider you will ultimately save on costs as you are not paying a premium to a variety of businesses, but just one. 

This also makes your costs more straight forward and saves you a lot of time on your packaging project. 

Artwork Design

The artwork design itself has an impact on your service costs for custom packaging as well. 

Your artwork design needs to emulate and communicate your brand narrative while appealing to your target market. The more intricate your design ideas are, the more it will cost. 

Packaging design is a very competitive market, therefore artwork design services can be quite costly.

However, this doesn’t mean you have to opt for minimalism for your packaging to be successful and cost effective. 

Choosing cost effective materials with high quality printing and finishing capabilities will enhance your designs depending on the printing method you choose. 

Working with a design service separately from a manufacturer means you are paying a premium for your artwork designs. Only some design services will offer structural engineering, but, this too will cost you quite a bit. 

Once again, solution providers can help you save on your costs in terms of design services since you are working with one company on all aspects of your project. 

Structural Engineering

It is beneficial to consult a structural engineer to make sure you are optimizing your product packaging accordingly. 

While a standard shape may fit your packaging, the measurements still play a crucial role in both your products’ safety and your budget. 

Keep in mind, measuring your packaging dimensions is dependent on the interior dimensions. 

Making sure your product is measured correctly, ensures you are spending the minimum amount on materials and maximizing on your products’ protection.

Manufacturers will not advise you on measurements or structures. However, solution providers can offer structural design services and advise you on how best to optimize your packaging to protect and support your products. 

If you are opting for more complex structural designs, structural engineers will be able to make your designs functional for the real world through structural optimization. 

Working with a solution provider will allow you to save on structural engineering costs as you’ll be working with one company for all aspects of your packaging

All in all, structural design services are not as costly as you think, especially when working with solution providers. 

Let’s delve into some popular packaging structures and how you can optimize your budget. 

Corrugated

As previously discussed, corrugated packaging is one of the most popular packaging materials. 

But what about structures? 

The structure is ultimately up to you, but many opt for the following corrugated packaging structures, especially for e-commerce or subscription box businesses. 

• Regular slotted corrugated packaging
• Full overlap corrugated packaging
• Open end corrugated packaging

Corrugated packaging on it’s own is already a cost effective option. The structure in this case will affect the price very minimally. 

A great way to keep corrugated packaging costs low is opting for standardized structural designs, such as those mentioned above. 

However, you can explore more corrugated structures.

Folding Carton

Your folding cartons structure options are nearly endless. 

Because folding cartons are such a flexible packaging material, manufacturers can shape your packaging into basically any size and shape you want! 

However, sticking to standardized structures can keep your packaging costs much lower, as it would be if you opted for kraft instead of white folding cartons!

Some popular structures include, but are not limited to;

• Reverse tuck end 
• Straight tuck end
• Pillow boxes

Explore more folding carton structures.

Keeping folding cartons costs low entails opting for standardized structures that are easy to construct and manufacture. 

Rigid

Rigid boxes, as mentioned previously are the priciest to manufacture because of the construction process and the quality of materials. 

Because this packaging type tends to be the most expensive, your structures can be very complex and unique.

However, there are some standardized structures you can consider, even for rigid packaging. 

These include;

• One piece magnetic boxes
• Two piece rigid boxes
• Collapsible rigid boxes

If you’re looking to keep rigid packaging costs low, collapsible rigid boxes are your best bet. 

Because they save an immense amount of space, you’ll be saving on your shipping and warehousing costs, while still maintaining the high quality feel of rigid packaging.

Rather than fitting your packaging on multiple pellets for shipping, you can fit them on 1 or 2 to optimize on your costs. 

Comparing Printing Costs

One of the main reasons companies choose to opt for custom packaging, is the capability of printing your own branding straight onto your product packaging.

Your printing method is really up to preference.

There are a few popular printing methods used in the packaging industry.

There are three main options available for printing on custom packaging;

• Digital printing: Mostly used for smaller orders and is cost effective, designs are directly applied to the box.
• Offset printing: Uses a printing plate and rubber cylinder to transfer the design onto the packaging. It’s higher resolution and offers a sleeker finish, but is also on the pricier side.
• Flexographic printing: Designs are stamped onto the box directly (similar to digital printing) using a printing plate. This does tend to add up, as each plate can get costly. It only accommodates one color, so it’s best to use this for larger orders.

For the most part smaller-medium size businesses will opt for digital printing because it offers a good price for small quantity orders. 

It’s also time efficient and offers endless design opportunities.

Digital printing does best for small simple designs. For complex designs, offset printing is recommended for its quality. 

Offset printing can be quite costly, but the quality difference is drastic. 

Offset printing allows for high quality printing of your artwork designs. While the price difference between digital and offset printing is quite drastic, you’ll be able to save if you choose to print high volume orders. 

It is recommended to use offset printing for high quantity orders because the set up costs for printing will be much lower per unit. 

While it may seem tempting to opt for digital printing to pinch a couple of pennies, it can reflect badly on your brand by lowering the quality of your packaging design.

In most cases it is recommended to opt for higher quality printing methods like offset printing to optimize on your packaging quality. 

However, digital printing can still be successful for less intricate designs. 

The Cost of Manufacturing

As mentioned a few times now, manufacturers and solution providers operate very differently.

So, it’s important to determine what services (mentioned above) you require to package your products. 

Solution providers offer services for your entire packaging process, including manufacturing. 

Price wise, you are paying a premium to one company to provide you the entire process from ideation to delivery. 

Manufacturers on the other hand simply deal with your order. Everything up to and after manufacturing your order will be up to you. 

Most importantly you will be responsible for making sure your manufacturer carries out quality control tests. 

For example; for corrugated packaging it’s important to conduct the edge crush test to ensure your packaging is up to standard with your needs. 

This also may mean you are bound to a smaller sea of manufacturers as geographic location becomes more of a concern. 

Realistically, if you are sourcing a manufacturer yourself, you’d want them to be close by so shipping and logistics become easier to track and maintain. 

Furthermore, you’ll want to be able to get your hands on a sample or prototype before giving manufacturers the green light for production. 

While it may seem more cost effective to simply settle for a manufacturer and to hand pick the other services you require. 

Over all you’ll be paying much more than simply paying one premium for all your services. 

Not to mention, managing your packaging project becomes much easier as all your processes are packaged in one space. 

Read more about choosing the right custom packaging company for your project. 

The Cost of Shipping and Logistics

When considering how much custom boxes cost, shipping and logistics need to be a key consideration in your budget.

Your packaging structural design is somewhat dependent on your shipping method, as the weight and dimensions play a large role in your shipping costs.

Once you have some rough figures, you can then estimate how much it costs to ship packaging through different transport modes.

Furthermore, keep in mind that you may need to outsource services to ensure your logistics are planned out accordingly with your product launch.

Especially if you choose to go with manufacturers instead of full project cycle providers, your logistics are up to you to figure out.

This could potentially mean higher final costs.

Air Shipping

Air freight tends to be a common choice for international deliveries since it’s the most time efficient.

Air carriers generally charge based on the item’s weight and the amount or volume of shipped items.

The weight is calculated by the weight of the item itself or the item’s dimensional weight (i.e., the packaging and item combined), whichever is heavier.

Keep in mind that Air Shipping may not be necessary depending on where your manufacturer is located.

You may want to opt for one of the other shipping methods mentioned below to ensure your packaging doesn’t break the bank.

Water Shipping

Water shipping is an alternative for heavy shipments (over 500 kg) as it’s more cost-effective than air freight.

Charges are based on the volume of goods, as opposed to weight.

However, keep in mind that this might not be the most time efficient shipping method.

So, if you’re in a time crunch for your product launch, although cost effective, may not be the best way to optimize your custom packaging Logistics.

Ground Shipping

Ground shipping tends to be the most popular delivery method of choice, but it comes with challenges.

The dimensional weight of the item is an important part of determining the shipping price.

If you’re trying to work out how much it costs to ship packaging, you will need to think about your custom boxes’ weight and design and how that fits with ground shipping rates.

Ground shipping is very dependent on the dimensions of your packaging as the shipments may need to be split up.

Think of it this way; if you’ve got 500 oddly shaped boxes that do not have much capability of being stacked, you may need more than one shipping van/truck to have your packaging shipped to you.

This also plays into your costs for custom packaging as you may be paying more for ground shipment than you anticipated.

Keep in mind; ground shipping is only an option if the manufacturer is fairly close to you, otherwise you may need to opt for Air or Water Shipping instead.

To estimate how much it costs to design packaging and how much custom boxes cost in general, your shipping and logistics play a large role in raising your end costs.

While you may think you’re getting a steal with your custom designs and packaging, your logistics may change your mind very quickly.

That’s why it’s important to consider your shipping and logistics before you enter your manufacturing process.

Once you have a vision in mind, you’ll be able to better estimate how much it costs to ship packaging.

It’s essential to think about custom packaging weight when estimating costs and the volume of custom packaging being created to choose the right type of box and printing for your budget.

If you aren’t sure about how much it costs to design packaging and how much it costs to ship packaging, you can request a quote to get an exact estimate for your packaging needs.

Rising shipping expenses have remained stubbornly in place for many businesses, making it difficult to manage finances efficiently. 

Businesses have been left with few choices as they are sealed to high shipping expenses and contracts and have largely chosen to pass this expense on to the customer.

This is unfortunately not only true for their products, but their custom packaging too. 

According to The Financial Times, The price for containers moving goods from China to the US and Europe has remained at a record high and is projected to increase over the next coming years. 

As businesses continue to enter into contracts with higher than usual rates, it’s becoming apparent that higher freight costs may be here to stay.

Why are Shipping Costs so High in 2021? 

2021 has seen skyrocketing shipping costs as pandemic-related delays and closures continue to disrupt supply chain and freight flow. 

In addition, lockdown restrictions have been consistently slowing down global trade in general. 

Paired with increased trade imbalances, tensions and shrinking manpower due to stay-at-home orders, let’s just say it’s easy to see why shipping costs have risen the way they have.

For example, ocean freight demand increased as air and ground methods became more challenging during the pandemic. 

As ocean freight capacity decreases, rates remain high without much guarantee of transit times, making it difficult for many companies to even facilitate shipping their products and packaging out to customers on time.

While larger businesses have managed high shipping costs, small businesses have not had the same luxury as financial resources have been scarce. The increasing dependence on spot rates and price increases means that it’s difficult for small businesses to offer customers accurate shipping prices as the packaging they use is nearly 200% higher and time continues changing the cost for the worse.

It goes without saying that with limited capacity and increased demand, the shipping market is seeing a massive shift in pricing. 

While big shipping firms can take advantage of the situation due to their large client volume, the same cannot be said for others.

For smaller businesses that aren’t able to negotiate contracts as well or don’t have the resources, have been facing real difficulties. 

Price hikes and surcharges are often added to shipping costs due to weather, congestion, fuel, or other reasons, making it increasingly difficult for small business owners to keep costs down for customers and themselves. 

How COVID-19 has Changed Consumer Behavior

There is little doubt that COVID-19 has changed much of consumer behavior. 

Increased health concerns coupled with different lockdown restrictions worldwide have led to a major dependence on e-commerce and, of course, fast shipping. 

More and more shoppers have moved to online retail, leading to an unprecedented uptick in activity and demand for goods. 

With no access to malls or shopping centres, purchases have moved online across all sectors, including essential goods and groceries, but it’s clear that consumers are waiting to start shopping in more categories as restrictions continue to ease. 

While online shopping has increased, trends show that the average amount being saved has gone up as customers continue to exhibit caution in their shopping habits. 

But as lockdowns ease and vaccination rates rise, research shows that those savings have led to a pent-up demand for in-store shopping when the chance arises.This means businesses will once again have to shift their product focus to a different platform.

This requires custom packaging that has immense shelf impact which in itself has been hard to come by with the shipping rates and times constantly changing. 

Rather than hold on to savings, consumers seem to be planning for increased purchasing in categories such as beauty, apparel, and electronics. This increase in demand has led to soaring sea freight costs, especially for premium custom packaging. 

Delays in Freight and Shipping

Although carriers are starting to work towards increasing capacity, carriers and routes can’t currently accommodate all shipments. 

Premium shipments have seen less disruption comparatively, and with low capacity ships available, other shipments continue to see delays.  

In comparison, air cargo rates have been more stable, and businesses are beginning to see air freight as a viable option.

Although more expensive than sea freight, air freight may be the way out of shipping challenges right now. 

Additionally, it allows retailers to build out stable inventory offerings and edge out competitors who face logistical delays.

Increases in Freight Rates

Sea freight tends to operate differently, with most major retailers and manufacturers negotiating annual deals for rates privately. 

This year, prime routes between Asia and North America, for example, are seeing price increases ranging from 25% to 50% higher than last year, signifying the increase in demand.

Such high price hikes can be detrimental to businesses and lead to budgeting and planning for higher costs that may ultimately end up being passed on to long time customers.

Sea Freight

As sea freight continues to pose challenges, businesses have started to look for alternatives. 

For companies determined to use this method, the approach has been to place early peak orders and create more detailed plans for seasonal inventories. 

However, even by doing so, retailers and manufacturers have not been able to escape higher charges, as some operators have introduced early peak surcharges on top of higher prices.

Different routes have seen different pricing. 

According to Freightos, the Asia-US West Coast prices have seen a slight decrease but continue to be 114% higher than last year. 

However, Asia-US East Coast prices have increased over 200% compared to last year. 

Europe has seen the biggest burden in terms of price hikes, as the Asia-Europe pricing is nearly 650% more than last year.

Air Freight

With so much instability and unpredictability, air freight has seen changes as well. The increased demand has had an impact on pricing and cost, with more businesses flocking towards this option. 

Global air cargo volumes have spiked up, especially Asia-US rates, reaching 25% and staying consistent around that level. While there is stability, the prices have continued to be far higher than this time last year. 

Peak season is predicted to start earlier this year as more and more companies start to set up orders for September to ensure inventory arrives in time for the holidays. 

An already expensive option, air freight is still seeing high demand, indicating the need for reliable shipping options during an already stressful time. 

Moreover, with more regional lockdowns and issues with outputs and flows on the horizon, air freight rates will continue to stay high in the near future. 

Ground Shipping

As air freight and sea freight costs increase, retailers have tried to become more creative with their efforts. 

As a result, ground shipping has seen more popularity, but that has led to its own issues. 

Trucking capacity is low, and driving rates are up as businesses scramble to restock inventory in a timely fashion. 

Even though drivers are starting to return, there is still worry that strict quarantine rules and regulations could lead to further delays, particularly around the holiday season. 

How to Navigate the Current Freight Market

With so much demand and so little capacity, how do you navigate the current freight market and shipping costs? 

There is still a great deal of uncertainty around when things will go back to ‘normal,’ making freight costs difficult to manage. 

However, businesses of different sizes can take some steps to reduce the impact of freight shipping costs, especially for their custom packaging. 

Researching vendors and comparing quotes can help uncover differences in services and efficiency. 

Moreover, adding more time and budget for changes can help soften the blow if it does occur and give you more of a buffer for delays or issues – plan slowly rather than rushed. 

Finally, other solutions such as warehousing and other logistics options may help with profitability, so explore as many options as possible. 

Small and mid-size businesses may need additional budgeting and forecasting for delays and extra charges. 

Before making major shipping decisions for your packaging, it’s crucial to look at alternative shipping modes, desired transit times, and how these scenarios will impact profitability.

As businesses continue to grapple with shifting consumer behaviour and retail challenges during this unprecedented time, it’s crucial to stay ahead of competitors.

Although freight shipping is seeing increased demands, working together with freight providers and establishing clear expectations from providers can be incredibly beneficial for ensuring customers can receive products in a timely fashion.

Many businesses across all industries are suffering incredibly from these cost changes and are trying their best to maneuver their way around getting their packaging in time.

PakFactory is doing everything they can to keep customers up to date with the current shipping landscape for custom packaging. It is a difficult time and the costs have delayed many projects for many businesses. However, PakFactory vows to keep customers up to date with changes and ensure their packaging arrives in a plausible time frame through full or partial project management for businesses. 

Please consult with a product specialist as frequently as possible during your orders to ensure your shipping cost estimates are up to date.