Americans are ordering more than ever from Amazon.com Inc. this holiday season—but they may have fewer boxes on their doorsteps.
Amazon is trying to ship each order in one correctly sized package instead of multiple boxes, responding to rising shipping costs and consumers’ concern about the environmental impact and general nuisance of all that cardboard. That means adding bubble envelopes, tweaking algorithms and negotiating with manufacturers to make smaller packaging specifically for online sales, not store shelves.
This year, Amazon added machines in its warehouses that create padded mailers on demand to fit smaller items, all of which used to go into the company’s smallest-sized box. Almost half of all of Amazon’s products fit into the new mailers and poly bags, says Kim Houchens, director of customer packaging experience.
Amazon’s number of U.S. shipments could reach more than 1.2 billion this year, about double the number five years ago, according to estimates by supply chain consultancy MWPVL International Inc. Amazon’s third-quarter world-wide shipping costs rose 39% over last year to $5.4 billion.
One motivation for retailers to offer better boxing is a change in how UPS and FedEx Corp. charge for deliveries. This holiday season, UPS added an extra charge per package for certain dates. Both UPS and FedEx in 2015 started charging by size instead of by weight alone, to discourage retailers from sending small items in big boxes.
These factors are making smarter packaging a “major factor” this year.