Packaging budgets and supplier price changes

Separate price changes, quantity changes and SKU mix when explaining packaging spend.

Work through the task

  1. Build complete scoped cost per SKU and pair it with an explicitly planned demand quantity and period.
  2. Hold quantity fixed to isolate a price increase, then evaluate demand and product-mix changes as separate scenarios.
  3. Reconcile variable spend and fixed charges. Annual divided by twelve is an average, not a seasonal monthly forecast.

Tools for this job

A worked example

At unchanged demand of 100,000 kg, a price rise from EUR 3.00 to EUR 3.15/kg adds EUR 15,000, or 5%. If quantity also rises, the total budget change cannot all be attributed to the supplier price increase.

Use your supplier specification and quotation. These numbers demonstrate the arithmetic; they are not market prices or a packaging suitability assessment.

Checks before you decide

  • Defined planning period and SKU mix
  • Price and volume effects separated
  • Complete cost scope and fixed charges