BY JAMIE LEE

GREENPAC'S business is about thinking out of the box.

Greenpac - which has customers such as Hewlett-Packard and ExxonMobil - was started in September 2002 by managing director Susan Chong, who saw opportunity in the packing business.

'We saw a niche at that time,' Ms Chong tells BT. 'Companies were either over-packing or under-packing.'

'A lot of companies didn't focus on packaging - it was the last thing that they were thinking about. They wanted to get their products out and then say, 'Give me a box to pack these things in'.'

But this was not only a costly mistake for many companies as they were also hit with a risk to their reputation when products delivered were mishandled, she says.

Greenpac looks at how to pack more products in their customers' shipments, so as to help them save on logistic costs.

'Our business model is very simple. We help customers to re-engineer their current packaging to achieve bottomline savings by increasing the shipping volume if they are shipping by sea or reducing the freight weight if (delivering) by air,' says Ms Chong.

Ms Chong says the company adopts a five-pronged approach, which includes sourcing for the latest and most technologically advanced packaging and providing expert consultancy services to evaluate the most efficient way to pack and unpack products.

It also looks at reducing wastage accumulated through product damage by designing or re-engineering the packaging and helps customers comply with international standards and regulations for packing materials, she says.

For example, one hardware customer used to wrap its electronic boards with plastic, before shipping them off in carton boxes, which added bulk by about three to five millimetres. By changing the material used to ship the equipment in, the company was able to ship about 50 pieces more per box, says Ms Chong.

And because the material used by conductive, plastic bags were no longer needed, it brought the packing time down by about half, she adds.

In another instance, Greenpac was able to reduce the weight of shipment by about half - this was done by changing the combination of wood used in the wooden crates, she says.

'The savings can range between 10 and 50 per cent,' says Ms Chong, whose company owns two design patents, including one for a recyclable wooden crate that has no nails.

Greenpac has seen sales at least doubling each year and has set up offices in the United States and the United Kingdom, where most of its current customers are based, she adds.

With the economic slowdown, sales have fallen by about 30 per cent over the last six months, especially as MNCs are hit by slowing consumption.

'Volumes have come down,' says Ms Chong, noting that this has created more competition among packaging companies which are looking to stay afloat during the recessionary period.

'There are lots of excess capacity in the market now,' she says, referring to the spare capacity faced by packing companies due to the fall in demand. 'Everybody is hungry and getting into price wars.'

But she adds that the slowdown in demand at her company has been offset by a quadrupling of new projects secured. Some of the demand is coming from Europe, where customers are transferring their equipment over to Singapore.

'While we are not expecting sales to double this year because of the economic conditions, we still expect to see slight growth,' says Ms Chong, adding that the company would also look to invest in research and development to improve its production capabilities.

The company has also spent about $500,000 to switch its production to the mainframe, to be in line with what its customers are using, she says.

Ms Chong adds that the company's diversified strategy is likely to keep the business strong.

'We pack materials from the nylon in your braces to 14-tonne machinery,' she says.

The emerging awareness of environmental issues has helped to drive demand, though Ms Chong notes that much of it is driven by cost savings.

'If it's just about being environmentally friendly, people won't want to pay extra,' she says.

And Greenpac faced its own credit crunch before the global financial crisis hit - Ms Chong says that banks were reluctant to provide loans to start her company. Instead, she relied on a $30,000 government grant and built her business from there.

'It was difficult initially but we have managed to grow organically over the years,' says Ms Chong, adding that most banks are willing to work with the company today.

On future fund-raising, Ms Chong says the company does not plan to go for an initial public offering at present but is open to it.

'We are still growing,' she says. 'Perhaps, when the timing is right.'

This article was first published in The Business Times on 24 November, 2008.