A Cost-Minimization Model to Optimal Packaging Size in E-commerce Context

Packaging greatly affects the operational efficiency and cost of modern logistics, and plays a decisive role in supply chain. This paper is driven by the need of a more economic packaging scheme in small and medium-size E-commerce enterprises in China. They are facing with the problem to satisfy the diverse product packaging needs at the lowest cost. A suitable series of packages is a reliable solution. In this paper, we develop a cost-minimization model including relevant supply chain costs to determine optimal packaging sizes. The developed model is then validated in a case study about a tableware sales company. The results show that the model has a 30% average improvement in packaging costs compared to the current packaging situation.