Packaging Management – Perfectly Packaged

“Packaging materials are becoming even more important,” says Tobias Theile, Technical Director and responsible for Logistics and Packaging Services at Formel D. As vehicles and vehicle parts are becoming more sophisticated through the use of new materials and their functionality, the logistics and packaging concepts needed for their protection are even more important. “The essential requirement is that packaging must be appropriate for the product design,” is the conclusion of Siegfried Eiber, Manager Packaging in the central distribution centre at BMW in Dingolfing. Formel D has been supporting BMW in the field of packaging management since 2012.

Ralf Skarupa, Manager of Supply Chain and Packaging at General Motors Europe and responsible, among other things, for after sales packaging, mentions another reason for the increasing interest in optimised packaging solutions: “The reduction, optimisation and standardisation of packaging materials offers considerable potential savings. That is why we have focussed on packaging management in the last few years.”

Formel D can now look back on 18 years of experience in packaging technology at Opel/GM. The service provider is responsible for the entire packaging and its budget control for after sales parts at three locations. Thereby Formel D ensures the provisioning of spare parts for all Opel and Chevrolet dealers and workshops in Europe. “Together with Formel D we have completely restructured this business during the last few years,” Ralf Skarupa reports.

Existing packaging concepts are constantly subject to quality and performance audits, to analyse how they can be improved. In the first instance, Formel D uses standardised packaging materials which are discussed and defined together with the suppliers. If no standard packaging is available, or if other alternative concepts are less expensive, Formel D develops new packaging concepts, evaluates the packaging prototypes and presents them to the customer for final approval. As a further customer benefit this constantly leads to technically optimised packaging concepts, which due to standardisation and higher purchase quantities, are also more economical.

Since the beginning of 2013 Formel D has been responsible for packaging planning in the after sales sector at BMW in Dingolfing and Munich. Siegfried Eiber is “very satisfied” with the provided service. The deciding factors for the assignment of Formel D “were the experience and references in packaging technology,” he says. “We were also convinced by the very good quality management.”

Apart from optimising existing packaging, the focus at BMW is on proactive packaging planning. Even before a new part is delivered, the packaging is defined and discussed with the supplier, and samples are produced which are then subject to testing. Then Tobias Theile’s team develops and approves all the packaging specifications for the suppliers. In the view of the Technical Director: “The trend is towards direct storage.” Siegfried Eiber points out that the after sales supply chain is very complex in relation to suppliers, central and regional warehouses, distribution centres and workshops. “We have many more handling and process steps than in series production and therefore special demands on the quality of packaging.” The main objective is to make arrangements with the supplier which ensure a continuous material flow without repackaging, and so reduce effort and costs.

Formel D is also responsible for the new parts area, the location where the parts at BMW and Opel/GM physically arrive for the definition of the packaging concept. After the physical evaluation of the parts and their packaging materials, the concepts will be approved or re-defined based on technical requirements. Technical data such as the dimensions of the parts and packaging as well as the packaging weights are entered into IT systems. This data can then be used in the calculation of subsequent processes such as warehouse utilisation or truck load optimisation. Furthermore, this complies with the requirements of the European packaging regulation. In the last 18 years Formel D has specified packaging concepts for a total of 310,000 parts for Opel/GM, BMW and other customers.

Another part of Formel D’s activities is the processing of “top-damaged parts”. Damaged deliveries are analysed for the cause of the defect and the affected packaging materials are improved to avoid future damages.“We not only make savings by having a reduced number of damaged parts but also because the enormous costs for processing claims are omitted,” is Ralf Skarupa’s assessment of Formel D’s work.

According to Tobias Theile the important thing in all these activities is “not only to optimise the packaging but to consider the entire supply chain.” One example of this is his team’s work at BMW: after a short training period a handbook was prepared containing the processes, check lists and a software guide for the applications in the BMW systems. With this a systematic working basis was created for the entire packaging processes.

“Packaging planning is becoming more process- oriented and IT-driven,” says the Technical Direc- tor. This is shown, for example, by the year-long development of a web-based database for Opel/ GM that controls all the packaging-related pro- cesses and activities. Among other things, the database contains packaging concepts, minimum requirements, packaging material weights and information about hazardous materials for all project participants. Various interfaces for import and export enable communication with other IT systems, for example those used in warehouse management systems. “Actually ‘database’ is not the correct term for it,” in Ralf Skarupa’s opinion; it can do much more than structure data. “The system allows us to achieve better prices even in the planning and commissioning stages of packaging.”

The importance of environmental aspects is increasing, including compliance with recycling rates as required by the European packaging regulation. If these are not complied with, fines are imposed. Formel D supplies the basic data for this. The service provider also assumes the responsibility (along with the packaging material suppliers) for the substitution of packaging material ingredients in accordance with the REACH regulations.

With international deliveries there are also country-specific guidelines to com- ply with. While certain hazardous materials can be imported into Germany, they cannot, however, be forwarded. For these goods, special hazardous materials packaging must be developed which then have to be approved by the Federal Institute for Materials Research and Testing. Formel D employees coordinate the implementation of these legal requirements, organise bonfire tests and take care of necessary safety data sheets.

Depending on the tasks, the Formel D packaging teams at BMW and Opel/GM can be expanded at short notice when required. BMW recently benefited from this when they introduced a new IT system in their central parts warehouse. Due to the new system and its requirements many of the previous processes in Tobias Theile’s team had to be optimised and redefined at very short notice. Siegfried Eiber was “impressed by the flexibility and speed of response of the Formel D team during the IT go-live.” In addition, Ralf Skarupa emphasises their “tremendous commitment, willingness to perform and reliability.”

The teams not only consist of logistics specialists and packaging engineers but also of people with an automotive education or who have experience in other technical and logistical fields. Tobias Theile explains the team mixture, saying his colleagues not only understand packaging processes, but must also have an expertise in logistical processes. Furthermore, it is also essential to know which components are essential for a car and which packaging materials will offer the best protection. The candidate profiles are completed by language skills – a matter of course in the context of the global activity of international customers.

In addition to the professional qualifications of the employees, Formel D customers value the fact that Formel D is an all-rounder in packaging management, “That brings synergies which lead directly to cost savings for BMW,” says Siegfried Eiber.

Tobias Theile is convinced that this possibility is not confined to the automotive industry. The expertise from 18 years’ experience in packaging management can also be used in other industry sectors. This also contributes to the experience of his employees in the development of packaging concepts, including in the healthcare and food industries.

Formel D is also bringing its experience and expertise to the working group on CoC packaging in the German Association of the Automotive Industry (VDA). Here, Formel D is supporting the work of their customer, Opel/GM. “We all benefit from the fact that Formel D is also pushing the subject of packaging with other manufacturers,” emphasise Siegfried Eiber and Ralf Skarupa, who both point out the value of the joint work of the VDA working group.