1 Agribusiness Library Lesson L060032 Packaging and Labeling Products

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Agribusiness Library

Lesson L060032 Packaging and Labeling Products

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Objectives

1. Describe the growing importance of packaging.

2. Explain package design considerations.

3. List the important information on labeling.

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Key Terms

compliant products family packaging intermediaries label labeling packaging shelf life tampering universal product code (UPC)

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What is the importance of packaging?

Packaging involves enclosing and protecting products for distribution, storage, sale, and use through the use of technology and art. A package label is the written or graphic communication on or in the package. Information Resources Inc., an international sales and marketing research firm, reported that “75 percent of the individual UPCs introduced between November 1996 and November 1998 failed within two years of introduction.”

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UPC stands for Universal Product Code and is the unique bar code found on products throughout the United States and Canada. For customers to see and recognize products at the store, companies must make them stand out from the competition. Therefore, packaging has several goals.

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A. Protection—The product within the packaging must be protected from vibrations,

compression, temperatures, water vapor, dust, and other outside forces. Protection also keeps products clean and sterile for their shelf life—length of time that food, medicine, and other perishable items are given before they are no longer good for sale or consumption. Most shelf life dates are guidelines based on normal product handling.

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B. Restraint—It is easier to have many small objects restrained in packaging rather

than transporting or handling them individually. Items like pencils, napkins, pasta, and LEGO® bricks are best sold in some type of restraint packaging. Liquids and powders also need to be contained.

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C. Communication—Packages and package labels communicate what is included in the package; any product warranties or pertinent warnings; and how the products should be used,

transported, disposed of, or recycled. For medicine, food, and chemicals, governments require certain information to be shared on the product label.

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D. Marketing and sales—The package design, individual components that compose

the package, and the label information work together to encourage customers to purchase the product. Today, more than ever, the graphic design on a package attracts attention. Well- planned designs create an image of quality or “coolness” and support the company’s brand.

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D. Marketing and sales— (cont’d) Many companies do this effectively, but each company takes a different approach. If the package design is not carefully considered, the company misses an

opportunity to maximize revenue and to develop a repeat customer base.

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E. Security—Packaging can keep products safe and secure in shipment and sale. Tampering— changing a product without authorization— results in lost profits for a company. As a result, companies work to make their packaging

tamper-resistant so damages and shoplifting are minimized.

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E. Security—(cont’d) For example, designers may attempt to make packages tamper-proof by adding extra layers of packaging (e.g.,

elements that require tools to open the product), making the packaging extra strong, and incorporating seals that easily identify if someone has tried to or has opened the packaging.F. Convenience—An overall good package design

ensures that it is handy in transporting, handling, stacking, displaying, selling, using, and

reusing.

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What considerations must be made when designing a package?

Companies and design teams must consider many aspects when developing packages, including brand consistency, cost, functionality, intermediary needs, and environmental responsibility.

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A. Brand consistency—If the product packaging is not consistent with the company’s brand, the product ultimately does not help build

company recognition. To promote an overall company image, a firm may decide that all packages must be similar or must include one major design element. When this approach is only used for certain lines of products, it is called family packaging. Criteria that aid in building brand

consistency and recognition for the product include:

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A. Brand consistency (cont’d)1. Differentiation—The product must be

different than that of the competition. It should stand

out on the shelf at the store and should be eye catching.

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A. Brand consistency (cont’d)2. Attractiveness—The target audience should

find the design appealing and appreciate the colors and text used in addition to the shape of the packaging.

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A. Brand consistency (cont’d)3. Legal requirements—Rules must be

followed to make legally compliant products (products that conform to legal requirements). This could include any number of things, depending on the product

type. Examples are the product name, company name and address, net weight, ingredient and nutrition labels, and product claims.

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B. Cost—Customers will pay for improved packaging, but there is a limit. If the

product is high end, customers will pay more. If the product is of low quality, customers will not pay much for packaging.

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C. Functionality—If the product is not functional, the customer will likely be dissatisfied with the purchase. Specifications that lend functionality to product packaging include clear instructions;

easy to open elements; and resealable, storable, unbreakable, sanitary, and light-weight packaging.

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D. Intermediary needs—Intermediaries are the individuals and companies responsible for handling a product after it is manufactured and before it is in the hands of the customer. Examples of intermediaries are wholesalers,

transportation companies, and retailers. Concerns that intermediaries have must be taken into consideration through the design process:

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D. Intermediary needs (cont’d)1. Will the packaging provide protection

through the distribution, shelf life, and consumption of the product?

2. Is the packaging strong enough to allow for stacking?

3. Can the product be delivered in bulk? Resellers may refuse to carry a certain product if the packages are cumbersome or if they do not protect the product because consumers will not

buy damaged products.

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E. Environmental responsibility—Companies must balance consumers’ desires for convenience against desires to preserve the environment. Nearly 50 percent of all garbage consists of discarded plastic packaging. For the most part,

the packaging is not biodegradable. For this reason, many companies are exploring

packaging alternatives, recycling more materials, and using packaging options made from recycled materials.

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What information may be found on product labels?

Labeling is the process of providing consumers with important information on a product or its packaging. Companies can provide two types of information on labels: information that makes the product more convenient for the customer to buy or use and information that is required by government agencies. For the required information, the regulations are aimed at protecting the consumer from misleading product claims and from improper product use.

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A. Examples of information that may be included on a product label:

1. Brand name and mark2. Registered trademarks (® or ™) or

copyright (©) symbols3. Package size and/or contents4. Product claims5. Directions for assembly and/or use

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A. Examples of information…product label (cont’d)

6. Safety precautions7. Ingredients8. Name and address of manufacturer9. Company logo10. UPC

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B. Examples of information that must be included on certain types of products:

1. Garments must be labeled with the name of the manufacturer, country of manufacture, fabric content, and cleaning instructions.

2. Any food product for which a nutritional claim is made must have nutrition labeling that follows a standard format.

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B. Examples of information (cont’d)3. The ingredients of food products must be

listed in order, beginning with the ingredient that constitutes the largest percentage of the product.

4. Nonedible items (e.g., shampoos and detergents) must carry safety precautions as well as instructions for use.

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Review What part of the packaging impacts the shelf life most? What can a company do when designing their packaging to promote their overall image? Name some criteria important for building

brand consistency. What types of product must have safety

information on the label? What other types of products have requirements for their labels?

Documents

1 Agribusiness Library Lesson L060032 Packaging and Labeling Products