PACKAGING AND LABELLING • Learning objectives: This chapter will help you to evaluate the importance of Packaging and Labeling in Foreign Trade. Chapter 8 Import Export Management PACKAGING AND LABELLING • 1.1 IMPORTANCE OF PACKAGING • The basic objective behind packaging is to prevent damage to the product during storage, transportation and handling, when it is in movement for distribution in the market. • It forms an important cost element of goods and represents 5-30 percent of the value of goods, depending on the type of product. • The main cost elements are the purchase of packaging materials introducing automated or manual packing operations, and further the need for disposal of material. A systems approach is necessary to manage packaging. Chapter 8 Import Export Management PACKAGING AND LABELLING • The first packages used the natural materials available at the time. Baskets of reeds, wineskins, wooden boxes, pottery vases, ceramic amphorae, wooden barrels, woven bags etc. Processed materials were used to form packages as they were developed for example, early glass and bronze vessels. The earliest recorded use of paper for packaging dates back to 1035, when a Persian traveler visiting markets in Cairo noted that vegetables, spices and hardware were wrapped in paper for the customers after they were sold. Iron and Tin plated steel were used to make cans in the early 19th century. Paperboard cartons and corrugated fiberboard boxes were first introduced in the late 19th century. • Packaging advancement in the early 20th century included Bakelite closures on bottles, transparent cellophane overwraps and panels on cartons, increased processing efficiency and improved food safety. As additional materials such as aluminum and several types of plastic were developed, they were incorporated into packages to improve performance and functionality. • In-plant recycling has long been common for production of packaging materials. Post-consumer recycling of aluminum and paper based products has been economical for many years. Chapter 8 Import Export Management PACKAGING AND LABELLING • Types of Packaging Materials • Shrink – Wrapping • Stretch – Wrapping • Aluminum • High – Density Plastic Boxes • Plastic Strapping • Plastic Foam Dunnage • Film – Based Packaging • Blanket – Wrapping • Returnable Containers • Intermediate Bulk Containers • Plastic Pallets • Pallet Pools • Refrigerated Pallets Chapter 8 Import Export Management PACKAGING AND LABELLING • Packaging Cost • The packaging costs depends upon factors like nature of product, physical dimensions, value, regulations etc. Delivery of the product at minimum overall packaging cost is essential. • The various costs involved in packaging are: • Unit Package Cost • Operational Cost • Warehousing Cost • Distribution Cost Chapter 8 Import Export Management PACKAGING AND LABELLING • Designing a Modern Day Package involves the following steps: • Briefing the designer • Gathering information about the package • Writing the Design Platform • Creative phase • Consulting Suppliers • Initial Presentation • Modification • Design Testing • Image Tests • Usage Tests • Visibility Tests • Brainwave analysis • Final design phase • Production Design • Finishing the Job Chapter 8 Import Export Management PACKAGING AND LABELLING • Factors effecting the choice of packaging materials Characteristics of Materials to be packaged Destination Kind of Transportation Handling, showability and storage considerations Conditions of usage and distribution Cost Availability of the type and choice of substitutes Chapter 8 Import Export Management PACKAGING AND LABELLING • There are two main types of packaging: • (a)Consumer packaging : This packaging is done with a marketing emphasis • (b)Logistical/Industrial packaging: The concept of containerization or unitization of the individual products are grouped into carton, bags, bins or barrels for handling efficiency. Chapter 8 Import Export Management PACKAGING AND LABELLING • Functions of Packaging: Damage Protection Utility / Convenience Communication Chapter 8 Import Export Management PACKAGING AND LABELLING • Shipping Containers : • A shipping container is a container with strength suitable to withstand shipment, storage and handling. • Shipping containers range from large reusable steel boxes used for intermodal shipments to the ubiquitous corrugated boxes. Chapter 8 Import Export Management PACKAGING AND LABELLING • Types of Shipping Containers: • Intermodal freight containers • Corrugated boxes • Wooden boxes • A crate • An intermediate bulk container • A flexible Intermediate Bulk Container • A bulk box • Drums • Insulated shipping containers • A Unit Load Device • Specialized shipping containers • Flight cases and transit cases • Unitization • Palletisation for Unitization Chapter 8 Import Export Management PACKAGING AND LABELLING • 1.2 VALUE ADDED PACKAGING • All consumers assume that a package is going to contain and preserve food. • The following are the value-added functions for today’s consumer: • 1.Brand Identification • 2.Advertising at the Point-of-Purchase • 3.Product Transport • 4.At-Home Storage • 5. Task Assistance Chapter 8 Import Export Management PACKAGING AND LABELLING • 1.3 LABELING • Many types of symbols for package labeling are nationally and internationally standardized. For consumer packaging, symbols exist for product certifications, trademarks, proof of purchase etc. Some symbols and requirements exist to communicate aspects of consumer use and safety, for e.g. the estimated sign that notes conformance to EU weights and measures accuracy regulations. • Technologies related to shipping containers are identification codes, bar codes and electronic data interchange. • With transport packages, standard symbols are also used to communicate handling needs. Chapter 8 Import Export Management PACKAGING AND LABELLING • 1.4 BAR CODES • A barcode is an optical machine-readable representation of data, which shows data about the object to which it attaches. • Barcodes originally were scanned by special optical scanners called barcode readers; later scanners and interpretive software became available on devices including desktop printers and smart phones. Chapter 8 Import Export Management PACKAGING AND LABELLING • Radio-frequency identification (RFID) is the use of a wireless non-contact system that uses radio frequency electromagnetic fields to transfer data from a tag attached to an object, for the purposes of automatic identification and tracking. Some tags require no battery and are powered by the electromagnetic fields used to read them. Others use a local power source and emit radio waves. The tag contains electronically stored information which can be read from up to several metres away. Unlike the barcode, the tag code does not need to be within the line of sight of the reader and may be embedded in the tracked object. • RFID chips contain a radio frequency electromagnetic field coil that employs a magnetic field to emit a coded identification number when queried by a reader device. An RFID application can be affixed to an object and used to track and manage inventory, assets, people etc. Chapter 8 Import Export Management PACKAGING AND LABELLING • 1.5 DANGEROUS GOODS • Dangerous goods are solids, liquids or gases that can harm people, other living organisms, property or the environment. They are often subject to chemical regulations. HazMat teams are personnel specially trained to handle dangerous goods. • Dangerous goods include materials that are radio active, flammable, explosive, corrosive, oxidizing, asphyxiating , biohazardous, toxic, pathogenic or allergenic. • People who handle dangerous goods will often wear protective equipment, and metropolitan fire departments often have a response team specifically trained to deal with accidents and spills. Chapter 8 Import Export Management PACKAGING AND LABELLING • IATA DANGEROUS GOODS REGULATIONS ( IATA –RESOLUTION 618 ATTACHMENT “A”) • Classification : Dangerous goods are defined as those goods which meet the criteria of one or more of nine UN hazard classes and, where applicable, to one of the three UN Packing Groups according to the provisions of this section. • Packing Groups: Packing groups are used for the purpose of determining the degree of protective packaging required for Dangerous Goods during transportation. • Identification: Dangerous Goods are assigned to UN numbers and proper shipping names according to their hazard classification and their consumption. They must be assigned to one of the proper shipping names shown in the list of Dangerous Goods. • Packing : The shipper is responsible for all aspects of the packing of dangerous goods in compliance with these Regulations. Chapter 8 Import Export Management PACKAGING AND LABELLING • IATA DANGEROUS GOODS REGULATIONS ( IATA – RESOLUTION 618 ATTACHMENT “A”) contd. • Packing Specification & Performance Tests: Codes are used to designate the Types of UN Packaging's. Two system of Codes are used in these Regulations for designating the types of packaging's. The first is applicable to packaging's other than inner packaging's. The second is applicable to inner packaging's. • Marking & Labeling: The shipper is responsible for all necessary marking and labeling of each package of dangerous goods, and each over pack containing dangerous goods, in compliance with these regulations. Chapter 8 Import Export Management PACKAGING AND LABELLING • 1.6 INDIAN INSTITUTE OF PACKAGING: • The Expert Committee of Hazardous Goods of United Nations