Delving Into The Drivers of Flexible Packaging's Growth
Tom Egan, PMMI vice president of industry services, examines the status of this growing packaging segment and the factors that are influencing its advancement.
Q: What do you see as the three biggest packaging trends for 2020?
A: As technology, sustainability and e-commerce are megatrends impacting the packaging industry. Smart packaging technology is developing rapidly. A major factor driving this growth is demand for packaging that indicates and maintains product quality throughout the supply chain. Smart labels plus augmented reality are two ways to integrate smart packaging into current formats. These labels not only help to prevent theft, but also locate products as they move through the distribution chain. Smart labels can also be used to monitor temperature and quality, alerting the brand or the consumer when a product has been compromised.
Smart packaging can also mean smart materials, such as those that absorb oxygen and extend shelf life without additives or preservatives. These technologies meet consumer demand for clean-label products while maximizing shelf life and allowing CPGs to expand distribution. Packaging materials also are being designed to react to temperature, light and oxygen to enhance the consumer’s experience with a package and a brand.
Manufacturers are also exploring ways to drive sustainability for flexible packaging, for example by using 3D printing. Doing so decreases the need to store an abundance of labels and eliminates the concern of having to discard unused labels produced as a result of changes made to older versions of label graphics or copy. Starch-based and biodegradable films are also growing in popularity in addition to efforts to maximize scale in order quantities using fewer films.
While many companies are still determining how to showcase flexible packages to create positive consumer impressions online, e-commerce requires that flexibles be more durable than ever to ensure products reach consumers in good condition. Manufacturers see a trend in the e-commerce space for flexible packaging, primarily to ensure that all products are packaged with peak freshness and avoid spillage or breakage during shipping. This represents a significant opportunity for beverages that use pouch packaging and ready-to-eat meal kits. E-commerce is also changing specific packaging requirements, prompting manufacturers to develop a business focus that caters to flexible packaging for this channel.
Q: PMMI’s OpX Leadership Network brings together brand owners and OEMs. What are some of the recent accomplishments of this group and what other areas is the group exploring?
A: The OpX Leadership Network’s goal is to deliver operational excellence by making processes more consistent across the industry with the help of industry peers. OpX currently offers over 15 published solutions that address common industry challenges centered around people, process and projects, as well as a new certification program called One Voice Ready. The program formally recognizes professionals who complete and demonstrate proficiency in one or more of the OpX work products while also aiding in closing the workforce development and skills gap issue, onboarding personnel and improving alignment, communication and connections. Each work product tackles a specific problem from overall Equipment Effectiveness (OEE), Total Cost of Ownership (TCO) to Requests for Proposal (RFP) and Factory Acceptance Tests (FATs).
Q: What factors account for the rapid growth in the use of stand-up pouches?
A: Within the flexible market, plastic pouches are set to witness the largest growth (20 percent) among flexible packaging types through 2022, according to PMMI’s “2019 Flexible Packaging Marketing Assessment.” Pouch demand is fueled by the format’s flexibility, ease of use and light weight, as well as rising popularity of ready-to-eat foods. Convenience features such as resealable closures, spouts and tear notches along with pouch manufacturing technology (e.g. machinery with increased line speeds) will continue to lower production costs, making pouches more competitive with other forms of packaging, like cartons and cans. Retailers often desire stand-up pouches for their shelf-ready appeal, minimal handling and controlled presentation.
Q: When it comes to flexible packaging, what have been some of the major technological advances in terms of machinery and materials?
A: Key technology developments continue to support packaging industry growth across a broad variety of manufacturing segments. Smart labels permit effective product location and verification. Innovative printing advances use flexographic printing and biodegradable technologies that promote sustainability of flexible packaging materials.
The market for flexible packaging is growing quickly at the expense of rigid packaging. However, rigid formats do offer some advantages over flexible. Throughput rates of rigid packaging are still higher than those of pouches, as these packages can be moved under greater rates of acceleration.
Some companies are turning to rental machinery, or machinery as a service, as well as contract packagers as a solution. This year’s PACK EXPO East (March 3-5, 2020; Philadelphia Convention Center, PA), will feature a Contract Packaging Sourcing Center hosted by CPA, The Association for Contract Packagers and Manufacturers. This resource will help show visitors address their contract packaging needs and offer solutions to their most challenging problems.
Q: With the current backlash against the use of plastics, will flexible packaging continue to be the fastest-growing packaging segment? Why or why not?
A: The environmental impacts associated with the production and disposal of plastics continue to concern consumers globally consumers globally. This has resulted in an increased use of recycled materials over the last decade including recycled corrugated card used in cartons and cases, recycled, high-density polyethylene (rHDPE), recycled polyethylene ate (rPET) film, and more.
However, plastics will continue as a useful packaging format in the foreseeable future. PMMI’s “2019 Flexible Packaging Marketing Assessment” reports that the U.S. flexible packaging market witnessed accelerated growth of 61 percent from 2000 through 2017. The market is expected to continue growing in almost all categories and will continue to increase at a 3.1 percent CAGR through 2023, reaching $391.6 billion USD. This rise is driven by both consumer preferences for convenient packaging and industry demands for sustainable and consumer-friendly packages. Flexible packaging is known for its convenience in terms of portability, shelf appeal and design properties. Aiding in this fact is that there has been a trend toward minimizing the use of material to reduce footprint. This requires redesign, careful monitoring of the amount of packaging used, and production of thinner packaging.
Additionally, in 2018, more than 290 organizations comprising 20 percent of all plastic packaging produced globally signed a global commitment to eradicate plastic waste at source and establish a circular economy for plastic material. Now, the challenge remains to implement machines for optimal functionality (e.g. to maximize production speeds with thinner, more fragile products).
Q: What adjustments are OEMs making to packaging machinery to handle “sustainable” substrates such as monomaterials or recycled films?
A: Companies using flexible packaging machinery may look to their equipment providers for guidance and service in improving machinery operation for sustainable films. Consequently, OEMs are aiming to improve flexibility for end users with solutions that handle greater varieties of packaging sizes and styles and higher volumes. Additionally, OEMs are releasing equipment that speeds changeovers. OEMs are also turning to automation to handle new packaging both efficiently and delicately.
Manufacturers and CPGs can keep up with the industry trends, insights and technologies to implement the latest solutions by visiting PACK EXPO East. Owned and produced by PMMI, the show offers attendees the opportunity to see the latest technologies from more than 400 exhibiting companies. The show will also offer educational programming and networking opportunities with 7,000 attendees expected to attend.