Introduction:
The US packaging industry has steadily undergone growth, demonstrated by stats and figures. The sector, valued to be USD 164 billion in 2016, rose to USD 177 billion in 2019. However, the fastest-growing packaging market with a CAGR of 3.5% over the forecast period of 2021 to 2026 also underwent a rough patch. The COVID-19 pandemic caused a global downslide of industries, and this industry was not exempted.
There are times when the packaging company owners want to launch a new product but encounter a massive shortage of funds. The old packaging equipment could be ramshackle and not correctly operational. However, affordability prevents several packaging company owners from going out and getting new equipment while replacing the old. Although several attempts to replace the non-functional equipment often occur, constantly hitting brick walls due to affordability issues might force the company owners to delay or finally abandon the new product launch altogether.
If things get too tricky, the company owners might want to give up on the business. However, before that happens, here are a few solutions that can save the company and get the new product launched.
Options to seek out when buying new packaging machinery is difficult:
Several companies belonging to different industrial niches suffer from this problem. It is not just restricted to the packaging industry. When companies have a new product to market, they need to put thoughts and actions behind packaging the product innovatively to attract the target audience. That is why securing packaging machinery will be helpful for every company. However, it might not always be a cakewalk. For situations when obtaining packaging machinery becomes difficult due to a shortage of funds, there are a series of options that one can take.
- Â Leasing new packaging machinery:
It is one of the age-old and tested methods that will enable the company to perform effectively while dishing out the new products in enticing packages. When buying new packaging machinery becomes difficult, financing the same equipment through a lease is the best option.
A lease is quite similar to a rental, where the person taking the machinery on lease has to pay small monthly payments over several years to their original owner. Since the duration is long and the payment scheme is quite affordable, it does not weigh down. Furthermore, the end of the lease signifies two distinct paths.
Either the person paying the rentals till now can trade the equipment in and upgrade for a new lease. Or they can finance the remaining cost of the machinery via continued monthly payments till the entire device is owned. In both cases, leasing is the best bet and gives an upper hand over buying the new machinery required for a product launch.
- Â Refurbishing the current packaging machinery:
For doing this, the packaging equipment owner will need the help of a technician who is skilled at renovating older machines. The technician or a team will be tasked with replacing the older and non-functional parts of the machinery with new ones. Although it is a temporary solution to the problem, it is highly inexpensive considering the current predicament.
- Â Buying or leasing refurbished machinery:
A piece of refurbished packaging machinery is nothing but old machinery with non-functional parts replaced with brand new ones along with maintenance and tune-up. As a result, the performance is similar to brand new equipment at a fractional cost compared to the new ones. According to industry experts, it provides a couple of advantages.
Since refurbished machinery won’t be as expensive, buying it will be easier. On the other hand, there is also the option to lease at an appreciably low cost per month. Although this option does not immediately provide one with brand new machinery, it gives the next best deal considering the situation.
- Â Outsourcing the packaging requirements to a contract packaging service:
A contract packaging or co-packing company is a professional service that takes care of all packaging dynamics of a company, including primary and secondary packaging, point-of-purchase, display builds, kitting and re-work, third-party logistics, etc., that the business can focus on its core competencies. There is no need to buy a warehouse, have an in-house labor force, or packaging equipment.
Contract packaging is often less expensive than buying brand new packaging machinery. Hence it could be the best solution for companies facing fund issues while purchasing new equipment.
Conclusion:
A product launch requires brand new and attractive packaging to create a long-lasting and robust impression amongst the customers. The options mentioned above will provide the right impetus to the business to streamline its core capabilities while reaping benefits without purchasing a piece of brand new packaging machinery.
