An Interview with Alan Taliaferro, Partner at Deloitte
Reserve your spot for the Smart Warehouse Open House on October 29.
Packaging has historically been an afterthought in supply chain strategy — a necessary cost, a box to check, something you dealt with at the end of the line. But as supply chains have grown more complicated and unpredictable, packaging is emerging as a powerful lever for transformation. The right packaging doesn’t just protect products. It can unlock new levels of automation, supply chain resilience, and customer satisfaction.
To understand this shift, we spoke with Alan Taliaferro, a Deloitte supply chain partner who has been at the forefront of packaging innovation for more than 30 years and is the founder of the firm’s flagship Smart Warehouse in Montreal. Alan has deep experience in supply chain and is recognized throughout the Deloitte network as the worldwide subject matter expert on logistics and distribution. He also leads a center of excellence in distribution center design. He shared his vision for the future of packaging, insights from recent disruptions, and practical advice for businesses looking to harness packaging as a strategic tool.
Packsize is a partner of Deloitte, providing right-sized packing machines in their Montreal and Düsseldorf Smart Factories.
Packaging has long been viewed as a necessary expense – something to minimize, not maximize. But that’s changing rapidly. In today’s supply chains, packaging is playing a starring role. It impacts everything from warehouse automation to network design, labor efficiency, sustainability targets, and the all-important customer experience.
In modern fulfillment centers, companies are reimagining the packaging process to enable high-speed automation, reduce waste, and optimize the flow of goods from receipt at the fulfillment center to customer delivery. This shift is delivering real, measurable benefits. It’s driving lower costs, faster operations, improved resilience, and a better experience for customers.
One of the bigger trends in the market right now is “right-sizing” – using packaging that is custom-created for each order based on its dimensions. This process reduces DIM weight and unnecessary materials, both of which reduce costs. When packaging is too large, companies aren’t just paying for extra cardboard and void fill – they’re also shipping air, which drives up transportation costs and carbon emissions.
Sustainability is now front and center for supply chain leaders. Regulatory pressures are growing, but customer expectations are evolving even faster. Increasingly, buyers want to know that the products they purchase – and the way they’re delivered – support a greener world.
Deloitte has made packaging a core part of its supply chain design and sustainability strategy. Right-sizing packaging can reduce box volume by up to 40%, cut void fill by 60%, and lower corrugate (cardboard) use by 26%. These improvements don’t just reduce waste – they directly impact truckload utilization, meaning more packages can fit on each truck, fewer trucks are needed, and emissions are lowered.
Material innovation is accelerating these gains. For example, Packsize’s z-Fold corrugate is made from 97% recycled materials, helping companies meet their environmental, social, and governance (ESG) goals and move closer to net-zero targets. The packaging industry is also shifting toward circular models, with materials designed to be collected, refilled, and recirculated back to the manufacturer. This “closed loop” approach keeps materials in use and out of landfills, supporting both sustainability and operational efficiency.
The biggest source of CO2 emissions linked to warehousing is transportation. By making packaging smaller and smarter, businesses can maximize every truckload, reduce the number of trucks needed, and shrink their carbon footprint. Customers increasingly prefer lower-emission deliveries, regardless of political or regulatory swings.
One of the most exciting developments in packaging automation is the growing ability to create a digital link between goods and real-time data to provide full visibility from order to delivery.
Companies can now use tools like barcodes, QR codes, or RFID tags to authenticate items, track their location, and collect information at every step of the process. For example, RFID-enabled packaging speeds up pick-and-pack processes by up to 20% and reduces labor needs. When this data is connected to warehouse management systems (WMS), enterprise resource planning (ERP) platforms, and other tools, businesses gain closed-loop visibility and can inform customers instantly if products are delayed or rerouted.
Technology also improves inventory accuracy and reduces fulfillment errors. If a package winds up in the wrong location, the company is able to see exactly where it is and can take action before it affects the customer. In a world where speed and reliability are everything, these capabilities offer a major competitive advantage for efficiency and customer experience goals.
For many organizations, the biggest hurdle to packaging innovation is perceived cost. New systems can seem expensive up front. But the real value comes from total cost of ownership and long-term savings.
Advanced packaging solutions can deliver powerful returns:
• Up to 20% less labor required for packing
• 30% less material used overall
• Minimized returns due to product damage
• Up to 40% reduction in shipping costs, thanks to smaller package sizes and better truckload utilization
The ongoing push to adopt the subscription model approach is making this value more accessible as well. For example, Packsize offers its solutions via the packaging-as-a-service model, turning packaging into a flexible, low-capital expense rather than a big upfront investment. This model also makes it easier to tie packaging improvements directly to ESG targets and broader business transformation goals.
Ultimately, success and potential return depend on how well stakeholders understand the current status quo – how much is being spent, where inefficiencies exist, and how new approaches can deliver value. Integration and change management are critical, especially if new solutions need to fit into existing processes or work with other systems like WMS or transportation management.
To capture the true value of packaging improvements, organizations must go beyond basic cost analysis to get more granular visibility into how packaging improvements can drive operational efficiency, mitigate risk, and support sustainability targets.
Companies often worry about the upfront costs, but the long-term savings from lower shipping costs, less labor, and fewer returns quickly pay back the initial investment.
Efficiency metrics reveal how packaging contributes to streamlined operations and bottom-line savings.
• Packaging Cost per Order: By tracking how much is spent on packaging for each shipment, companies can identify savings from right-sizing, material selection, and improved processes.
• Labor Costs: Efficient packaging solutions often reduce the time and effort required to pack goods, resulting in lower labor costs and freeing up staff for other tasks.
• Material Usage: Monitoring the amount of corrugate, void fill, and other packing materials used per order highlights opportunities to reduce waste and costs.
• Shipping Costs: Packaging directly influences shipping expenses. Smaller, lighter packages mean lower carrier fees and more packages per truck, which can significantly reduce overall transportation spend.
• Box-to-Product Ratio: This metric shows how well the packaging fits the product. A lower ratio means less wasted space, improved cube utilization, and greater efficiency in shipping and storage.
• Packing Time per Order: Measuring how long it takes to package each order uncovers bottlenecks and helps quantify the impact of automation or process improvements.
• Storage Space Allocated to Packaging: Optimized packaging requires less storage space in the warehouse, allowing for more efficient use of facilities and potentially lowering real estate costs.
Risk metrics help organizations manage and mitigate potential losses tied to packaging.
• Product Damage Rate: Poor packaging can lead to damaged goods, costly returns, and unhappy customers. Tracking damage rates helps assess the effectiveness of packaging and guides continuous improvement.
• Order Fulfillment Error Rate: Inefficient packaging processes can lead to picking and packing errors, resulting in incorrect shipments and customer complaints. Monitoring this rate ensures high-quality fulfillment and customer satisfaction.
Sustainability metrics are critical for meeting regulatory requirements, achieving ESG goals, and responding to customer expectations.
• Corrugate Usage per Order: This measures how much cardboard is used for each shipment. Reducing corrugate usage not only cuts costs but also supports environmental targets.
• Percentage of Recycled or Recyclable Materials Used: Companies can track progress toward greener packaging by measuring the proportion of materials that are recycled or recyclable in each package.
• Emissions Linked to Packaging: Packaging impacts emissions in two main ways – through the production of materials and by influencing transportation efficiency. Tracking carbon emissions associated with packaging and shipping helps quantify progress toward climate goals.
As we look to the future, we expect packaging innovation to continue to accelerate. Right-sized, on-demand packaging is becoming the norm, driven by equipment that is getting smaller, less expensive, and easier to integrate. Better technology and data availability are expanding real-time visibility, while digital twin and simulation tools help companies optimize packaging decisions before making a single box.
Circular packaging models – reusable containers, take-back programs, closed-loop systems – are becoming increasingly more common. As the industry matures, expect outbound case sizes for e-commerce to become standardized, just as shipping containers revolutionized sea transport. This will allow tighter, more efficient truckloads and further reduce transportation costs and emissions.
The machines themselves are evolving, too. Early generations of packaging equipment were bulky and expensive. Today’s systems are lighter, more compact, and increasingly affordable, opening the door for companies of all sizes to access advanced packaging capabilities.
None of these gains happen in isolation. Cross-functional collaboration between operations, procurement, and sustainability teams is critical when rethinking packaging solutions in the warehouse. When these groups align on priorities like speed, cost, and environmental impact, they can avoid trade-offs and choose solutions that deliver value across the board.
Change management and training are also key. New equipment and processes require people to adapt, and successful transformation depends on managing both the technology and the human sides of the equation.
If there is one piece of advice supply chain leaders take to heart, it’s this: invest early in packaging that supports automation, reduces waste, and adapts to change. The payback is real and touches every part of the value chain.
But don’t just read about these systems – go see them in action. The market is changing fast, with innovative technologies and approaches emerging all the time. Seeing is believing, and hands-on experience will help you understand the potential impact for your company.
Before you bring in consultants or start planning a big transformation, make sure you understand the benefits for yourself. The most successful leaders are those who get informed, ask questions, and take the time to see how the latest solutions can apply to their own business.
Ready to experience the future of packaging and supply chain innovation firsthand? Deloitte’s Smart Warehouse in Montreal is hosting an Open House on October 29. This is a unique opportunity to see the latest in packaging, automation, and fulfillment technologies, all functioning together in a real-world setting.
There is nowhere else you can see such a diverse suite of solutions working side by side, including drones, inventory management systems, vision technologies, automated picking, and more. Whether you’re an existing client or simply curious about what is possible, this is your chance to ask questions, see the technology in action, and discover opportunities for your own business.
Reserve your spot for the Smart Warehouse Open House on October 29.
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