Let's review its origin. Since August 2017, China's largest wrapping paper manufacturer has raised the price of raw paper four times. The increase was a whopping 70 percent. To remedy the situation, some retailers reduce costs by recycling boxes, while most respond by raising prices. There is more than one reason for the changes, according to one insider. In particular, the major state-owned paper companies are heavily indebted due to fierce competition, so this is a way for them to reduce their debt ratio and improve their profits.
It is important to know that China is bringing unimpeded development to the world pulp market today. In the past 20 years, China has become the world's first pulp consumer market. Rising living standards, as well as the buoyancy of paper and cardboard packaging, explain the growth in demand that would otherwise be stable in the rest of the world. Tensions in 2017 increased in the first three quarters of 2018, particularly as supply dwindled due to prolonged technical shutdowns at some nuclear plants and delayed installation of new plants under new environmental protection policies. As a result, the price of fibrils used to make cardboard has risen to historic levels throughout 2018.
That could be over by August 2018, as the government has eased restrictions that have closed thousands of factories amid fears of an economic downturn. Yet raw materials remain relatively expensive.
However, our custom tube packaging box customers can have quite a few concerns about this situation. Here's why:
The impact of higher prices on high-end bespoke boxes has been minimal
It is important to know that we focus on high-end and custom tube packaging box solutions, unlike bulky packaging cartons, these tube packaging boxes are made of many different materials and complex processing techniques. Compared with all those raw paperboard, paper only needs a small part of the cost, there is no need to increase the price.
The MOQ is very small and the material only accounts for a small part of our cost
We like to offer personalized and flexible quotes, which means we can even accept a MOQ of 500 for some models. This will not lead to the mass use of materials, cardboard price difference is not even noteworthy.
Better production management can compensate for the cost
Through better production management, increase production system, using new technology, we can even come up with a better price than before the rising prices of raw materials, it can be from different aspects: reduce material waste, improve workers' productivity, better system arrangement, reduce unnecessary costs, improve our design services, bring more added value for your package, we believe that our competitiveness is through our efforts, continuously upgrade our production and service system.
In a word, you do not need to worry about the increase of the cost of cardboard raw materials, more meaningful is that we will focus on bringing excellent products and excellent tube packaging boxes for customers
