There’s an interesting article in the WSJ today (As Costs Rise, Whirlpool Makes a Dent in Dings By Ilan Brat) about the cost of damaged inventory vs. the cost of packaging.

Basically, appliance manufacturers have been finding ways to trim the cost cardboard and foam used in packaging their products. Sort of makes sense - thin margins, competitive business, every penny counts. The only problem is that a machine is handled so many times before a customer sees it that the risk of damage is high. One ding leads to a return which wipes out any savings.

For decades, manufacturers have worked to reduce the cost of the cardboard, plastic and foam that protect products. But companies like Whirlpool in recent years have realized that how products are packed and how they are handled during shipping need to be looked at together, says Ralph Rupert, director of a packaging center at Virginia Tech in Blacksburg, Va.

“Why try to reduce my packaging spend half a percent, when if I just keep one product from being damaged, I’ve paid for weeks worth of packaging goods?” Prof. Rupert says. Americans bought $22.4 billion of major appliances last year, according to the NPD Group, a market-research firm in Port Washington, N.Y.

What I found particularly cool was how this problem was being tackled. In what might be perceived a low tech industry, Whirlpool is using a supercomputer and modeling techniques to simulate loads and test solutions.

After setting up a computer model of the process, the engineers discovered the clamp trucks sometimes were squeezing the washers too tightly, says Mr. Yates. They also found that the lower corners of the machines were bearing a disproportionate amount of the force.

The company got new, taller clamps with firmer metal to help distribute the force better. They changed the packaging, adding a sturdy cardboard beam across the machines’ tops to ease pressure on the lower corners.

“It’s not intuitive that you would put something on top to protect the bottom, but it works,” says Mr. Gielda. In the three months after the packaging design changes were implemented in the fall, damage rates on the washers and dryers declined more than 80%, saving millions of dollars, he says. “It was a big wake-up call for the supply chain,” he says.

It’s easy to get so caught up in optimizing a particular aspect of your offering that you lose sight of the big picture. You have to step back every now and then and make sure your priorities are still the right ones.