No respite for co-packers | Supplier Analysis – contract packing

How did business change once the Covid-19 pandemic hit, and the lockdown began?

Angus Campbell, Alexir Co-Packers: When the pandemic hit, business reflected what was happening in the high street. We were bombarded with orders from our customers in the retail sector and our customers in foodservice went very quiet overnight. As with all challenges though there comes opportunities and we have managed to remain fully operational throughout.

Abi Curtis, Blisters: I consider ourselves extremely fortunate in being able to be ahead of many by bringing in PPE, soap and hand gel well before shortages were common. We also installed many anti-Covid-19 procedures early to keep our staff safe. This not only helped to fulfil client demand but allowed our staff to feel safe at work throughout the pandemic.

Emily Stuart, Bray Solutions: Business has greatly increased since the pandemic hit, with customers wanting to prioritise their food related packaging as this was a huge requirement through lockdown. We have also been lucky to secure new contracts for our contract packing department for the Christmas season as well as contracts for our DC department and 3PL operation here at Bray Solutions.

Ben Stokes, Excel Contract Packing: Certain sectors were immediately affected, including industrial and building, but for newer developed sectors, such as PPE and testing kits, e-commerce and fulfilment, we have experienced growth.

Neil Humphrey, Mailway: As an integral part of the food supply chain, any concerns about us staying open were soon put to rest as our main partners remained very busy. From a sales perspective we were inundated with enquiries reflecting the demand driven by Covid-19, so it started with requests for sanitiser then moved to off-load for food companies struggling to keep up with demand for the likes of pasta and baking kits. Then, when the position shifted on face masks, we saw an uptake in demand for wrapping these and PPE kits. We have seen a partial return to business as usual and it is unclear what the next challenges will be but co-packers are a practical bunch used to being reactive and flexible.

Paul Sunter, Sun Fulfilment: E-commerce fulfilment orders increased massively, which in turn gave us a further increase in production such as filling, labelling and Amazon FBA services.

Are you considering making any investments into cobots or your packing lines?

Angus Campbell: We will always invest in what is needed to deliver a successful contract for our customers.

Abi Curtis: We have been able to invest this year to support our future growth with some machinery that will assist our day-to-day operations and if current business continues, we will be looking to invest into more next year also. Cobots are certainly the future but we have not seen any one make that will be flexible enough for our needs. We are still looking though.

Emily Stuart: With our predictions for 2021 and our plans to expand our warehouse space by a further 50%, one of the additional warehouses will be for our contract packing department. This should allow for two additional packing lines and the opportunity to grow the department significantly within the future. We have not got plans to invest into robots as we feel we are incredibly efficient with the staff we use.

Ben Stokes: We already have extensive automated packing equipment and as demand increases we are ready to invest further, in order to meet it.

Neil Humphrey: Mailway were amongst the first co-packers in the UK to invest in cobots and these have come into their own this season helping with social distancing when deployed on pacing lines. There is no substitute for an actual person in many situations but we are investing in numerous automation solutions, including deploying cobots. This is in part a response to potential recruitment challenges post Brexit but also enhances safe working and efficiencies.

Paul Sunter: During the last few months we’ve invested in shrink-wrap, filling and continuous inkjet machines. We’re currently looking to buy in a cello-wrap machine and find larger premises.

With more customers now asking for end-to-end service, to what extent are you developing e-commerce as part of your offer?

Angus Campbell: Certainly, we are looking at this side of the business as it is very unusual to have a food co-manufacturer and a fulfilment house under the same roof. We believe that this could be an interesting USP for brand owners.

Abi Curtis: We already have a good platform to support e-commerce businesses with regards to filling, picking and packing and look to further develop this in the forthcoming year.

Emily Stuart: Bray Solutions is already a well-established third party logistics provider. We receive goods, manage stock, pick, pack, and despatch using the very latest multi-channel order system in our private warehouses. With warehouse storage options across two sites, we are well equipped to handle logistics for international, as well as homegrown, clients. We help to place products to the end consumer.

Ben Stokes: We don’t offer an e-commerce service but we do pack for e-commerce companies and work with them in developing IT services for their logistics.

Neil Humphrey: We already trade and communicate with key customers using e-commerce solutions and have invested heavily in IT solutions during 2020 to back this up. Mailway offers customers a wide range of services and, as we continue to grow our operation, e-commerce is an area we are happy to support and collaborate with.

Paul Sunter: Sun Fulfilment was originally established as an e-commerce fulfilment company. We’re constantly reviewing our processes in order to keep pace with current and future trends. We’ve expanded to co-packing services thanks to requests from our customers, and that is something that will continue to do.

With rising unemployment, do you think it may be easier to recruit good staff in 2021?

Angus Campbell: We have successfully launched a management training scheme which has seen a number of our employees moving around the sites. There will be more talent in the resource pool for sure but conversely, we have to think of everybody’s job security too.

Abi Curtis: With competition rising for job vacancies and with so many people being out of work, I find it makes it harder to recruit the right person into the business. You then have a plethora of qualified personnel, so choosing can be difficult. I have found previously with other businesses it usually extends the application process as you’ll need more interviews or tasks to see where the skill and interests of that individual differs from one person to another.

Emily Stuart: There will be a larger pool of people out there looking for jobs due to the rising unemployment at this terrible time. However, the experience and skill set remains the same, and it is our highest priority here at Bray Solutions.

Ben Stokes: Finding the right staff for our operation hasn’t been an issue in the past and we don’t envisage any problems in the future. We are situated in an area that has many light industrial companies, with readily available labour.

Neil Humphrey: It is hard to tell at this stage, whilst Brexit was making it look like a tougher job going forward the regrettable rise in unemployment on the back of the pandemic may mean there is a growing pool of UK workers available for factory work. One thing I am in no doubt of is that Mailway will be recruiting in 2021.

Paul Sunter: Yes. There is a lot of unemployed talent out there, no thanks to Covid-19. It should be easy to find reliable and skilful workers, as well offering apprenticeships for the younger generation that can be trained and be offered excellent future prospects.

Was there a project that you were particularly proud of in the last 12 months?

Angus Campbell: I know that Alexir Co-Packers are particularly proud of a collaborative project between Brakes and Bidfood which saw the delivery of food packs from many different suppliers to the vulnerable groups in society. Alexir packed and delivered bagged noodles and rice, and had the whole project up and running in around nine days.

Abi Curtis: Not a single project, but I am really proud of the way that we, as a business, have handled the ongoing pandemic and have still been able to keep to our core value of giving our customers a great service.

Emily Stuart: One of the new contracts we have gained for contract packing is a company who sell all sorts of Christmas and seasonal food hampers. We are busy packing all sorts of different stock from sweets and popcorn to Christmas crackers. This has been a great achievement for us as it has helped us grow our co-packing team by 300%.

Ben Stokes: We are very proud to have been involved in the packing of PPE kits and testing kits, in view of the current worldwide problems with Covid-19.

Neil Humphrey: As a key partner of M&S we were delighted to be a part of their seasonal Percy Pig promotions and Mailway have provided a full service to them in the sourcing, development, procurement and packing of their Percy Pig Jars. A whole kilo of Percys available in a lovely re-usable embossed glass jar.

Paul Sunter: Starting Sun Fulfilment! The pandemic caused a few nervous moments, but we’re still going strong.How has the pandemic changed customer buying patterns and what effect has this had on Black Friday and Christmas 2020?

Angus Campbell: There has definitely been a shift for online buying and we have seen an increase in enquiries for e-commerce packaging and fulfilment. So far the brands and retailers are following typical Christmas buying patterns so we can only assume that consumer purchasing will be similar to previous years, although the purchasing channel may change. In our gifting division we have seen an increase in their online orders.

Abi Curtis: A lot of our customers are seeing an increased demand for their products, but are telling us that the supermarkets are erring on the side of caution with Christmas orders stabilising around the same as they were last year.

Emily Stuart: When the UK went into lockdown sales soared due to shipping items such as unique children’s toys, outside fire pits, water fountains and unique statement furniture. In the recent months, our sales have returned to normal with a view to increase again for the Black Friday weekend and Christmas period. As the Black Friday weekend is already one of the busiest shopping times of the year, it seems that this year will bring a further demand for e-commerce due to local restrictions.

Ben Stokes: Buying patterns for industrial and building markets changed significantly, in that they now tend to buy for immediate use/requirements, rather than planning ahead and keeping stock. We have experienced no particular effect on Black Friday or Christmas, as this doesn’t affect our market sectors.

Neil Humphrey: At Mailway ,Christmas as a packing season this year has been earlier and in some respects smaller in terms of the total number of projects. Understandably customers have been cautious, and their purchasing patterns will be influenced by retailers and the consumer. I think it is fair to say online sales are still likely to be buoyant and I think gifts like hampers will come into their own when it becomes more difficult for people to visit loved ones.

Paul Sunter: The pandemic has forced more people to buy online due to lockdown and the closure of many high street stores. I imagine that (specifically in e-commerce terms) Black Friday and Christmas will be utter mayhem, even more so if Covid-19 refuses to go away and more lockdown measures are put in place.

How do you see 2021 shaping up and what do you envisage will be the biggest challenges?

Angus Campbell: With Covid-19 and Brexit now in the picture it is difficult to know exactly how next year will shape up. As a business we are focusing on delivering packaging formats that the market needs, in a way that the consumer wants to buy.

Abi Curtis: 2021 is, and will be, an unknown entity to many whilst Covid-19 persists. I think that 2021 will be a difficult year with so much uncertainty around consumer buying habits. It’ll make it very difficult for our clients to forecast volumes which could see greater peaks and troughs of demand for product and therefore services required.

Emily Stuart: With coronavirus affecting all industries, our biggest challenge will be the closing of our customers businesses due to the pandemic while supporting them the best we can during this difficult and unpredictable time. In 2021 we are hoping to expand our warehouse space by a further 50%, with that the potential to increase our staff by 30%. We are aiming to still boast a 99.8% pick accuracy rate as well as renewing our ISO9001 audit for 2022 while continuing to work towards our BRC certification.

Ben Stokes: 2021 will be challenging for the industrial and building sectors but PPE and testing kits will continue to offer substantial potential business, at least throughout the year and maybe beyond.

Neil Humphrey: The words frying pan and fire spring to mind! 2021 will undoubtedly be fraught with challenges. We are not even through the pandemic yet and have Brexit to consider and the economic impact post-Covid. The huge uncertainty on cross border trade and logistics operations heading into 2021 is making planning and supply chain projections challenging for many of our customers. We are already seeing what the effects of tariffs are likely to be in some of our sectors; this could jeopardise some work streams but equally might mean a move to UK suppliers and potential work therein.

Paul Sunter: I have no idea! The world is a very different place and I don’t think any predictions can be made with any certainty. The demand for ecommerce is only going to increase and we need to make sure that we have the correct systems in place to cope. The need to offer additional services will also be a must. Clients are delaying new product due to Covid-19, and the need to offer additional services is hugely necessary.

THIS MONTH’S EXPERTS

Angus Campbell is business development manager at Alexir Co-Packers, a division of the Alexir Partnership. The £33m turnover company designs, manufactures and sources packaging across numerous substrates, and blends and packs dried food, for both blue chip and independent brands.

Abi Curtis is head of operations at contract packing and creative packaging firm Blisters. The company offers numerous services including packaging design, general contract packing, chilled, cool and ambient co-packing, blister packs, printing, labelling, shrink wrapping and more.

Emily Stuart is marketing manager at Bray Solutions, a third-party logistics providers specialising in contract packing, fulfilment and logistics services. The contract packing department offers various services, including: small light assembly, kimballing, labelling, bagging, shrink wrapping and batch coding.

Ben Stokes is director at Excel Contract Packing, a co-packing and logistics specialist. The company specialises in supply chain management, packaging and distribution. It works in markets including industrial and building, PPE kits and testing kits, fulfilment and e-commerce. Packaging materials used include printed polybags, clam blister and cartons.

Neil Humphrey is sales director of Mailway, a contract and promotional packing solutions provider. Serving primarily the food, drink and marketing sectors, the company works with blue-chip organisations as well as smaller owner-operated businesses on a variety of packaging concepts and promotional solutions.

Paul Sunter is director at Sun Fulfilment, which provides co-packing, filling and fulfilment services. The company operates in various sectors including food drink, pharma, personal care, pet care, household and more. It offers full warehouse management system access, e-commerce, Amazon prime seller fulfilled, and B2B and B2C order fulfilment.