KAO Brands is a leading consumer products company specializing in haircare and hygiene products. They rely on Barrett Distribution Centers (BDC), a third-party logistics (3PL) provider, to manage their entire fulfillment operation. As KAO's e-commerce business flourishes, optimizing costs per order becomes increasingly crucial.

A Sustainable Impact

Historically, KAO used seven carton sizes for packaging all their e-commerce orders. With ever-increasing shipping costs, BDC knew exploring hidden opportunities to improve KAO’s packing efficiency was necessary. Beyond the impact on their bottom line, KAO Brands strives to develop sustainable products and packaging, “making the world healthier and cleaner.”

BDC’s Industrial Engineering team, spearheaded by Nick Halcombe, investigated potential cost reductions through cartonization optimization. Halcombe stated, “By partnering with Paccurate to pilot their innovative cartonization platform, BDC sought to determine if Paccurate’s software could identify a more efficient carton suite for KAO Brands. This collaboration can lead to significant savings in transportation and materials and positively impact the environment.”

Leveraging Simulation for Real-World Impact

Paccurate’s packaging analysis tool, PacSimulate's, power lies in its ability to analyze vast amounts of order data and perform millions of cartonization iterations rapidly and at scale to test different carton sizes, cartonization rules, rate card changes, and more. In this case, BDC leveraged Paccurate to evaluate an entire year’s worth of order data to determine what savings might be found by optimizing the outbound shipping container sizes.

Data-Driven Results

The analysis revealed a clear path toward significant savings by comparing KAO's existing seven-box system to the ideal-fit cartons suggested by PacSimulate. Five out of the seven existing cartons were identified for replacement. This strategic shift resulted in a projected annual transportation cost reduction of 5.9%.

Furthermore, PacSim's analysis identified a substantial opportunity for material savings. The optimized carton suite yielded a 33% reduction in corrugated material usage and a 34% net DIM weight reduction. These savings will contribute to KAO Brand’s ESG initiatives of ensuring 100% of their products will leave a full lifecycle environmental footprint that science says the natural world can safely absorb.

Additionally, further analysis identified that KAO Brands could even reduce the number of cartons they stock while still seeing some benefits from a transportation and corrugated waste perspective.

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The Bottom Line

By implementing Paccurate's cartonization solution, BDC identified significant cost savings for KAO from both a transportation and materials perspective. The power of data-driven cartonization and its potential to significantly impact e-commerce fulfillment costs benefit customers and provide a value-added service for 3PLs like Barrett Distribution Center.

About Barrett Distribution Centers

Since 1941, Barrett has provided customized third-party logistics (3PL), direct-to-consumer (DTC) eCommerce fulfillment, omnichannel distribution, managed transportation solutions, and retail compliance for clients across all industries, with a focus on apparel & footwear, health & beauty, consumer packaged goods (CPG) and education. Barrett continues to be a leading 3rd party logistics provider in North America, known for superior execution, customer engagement, and direct access to senior leadership decision-makers. As a member of Inc.'s fastest-growing companies list 15 times, Barrett is big enough to do the job and still small enough to care about your business deeply. eCommerce brands interested in a new 3PL partnership may contact Barrett directly here.