5 Transformative Realities Across the Packaging Landscape

REALITY 1:

EQUAL CONCERN FOR PRODUCT, MATERIALS, AND TRANSPORTATION

Supply chain disruptions cause concern almost evenly across key functional areas of packaging: product-related concerns were the top concern for 34%, packaging material-related concerns for 41%, and transportation-related concerns for 25%.

Expert take: “With material delays happening in virtually every industry, we’re working with more and more companies who have embraced a substrate-agnostic approach. This translates to improved availability for a wider variety of materials, which allows us to look at alternative stocks and production methods without losing momentum.”

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REALITY 2:

MISSED DEADLINES AND EXTENDED TIMELINES

65% have missed deadlines due to supply chain disruptions. 86% reported increased timelines for a typical project. 41% said projects took up to 4 weeks longer than usual, another 31% said they took up to 3 months longer than usual.

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REALITY 3:

PRICES INCREASED, SUPPLY DECREASED

Material price hikes and supply shortages have presented the largest challenge over the past year, with 52% of respondents strongly impacted by material price increases, 46% by supply shortages, 37% by staffing challenges and 36% equally strongly impacted by increasing demand and speed to market requirements.

Expert take: Gaining production efficiencies in the face of today’s volatile market isn’t impossible. Structural engineering can uncover several opportunities, including designs that reduce a package’s footprint. The use of less material — or alternative, more-readily available options — also helps introduce new freight and storage savings.

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REALITY 4:

ONLINE SHOPPING DRIVES PACKAGING NEEDS

E-commerce has increased over the past 1-2 years for over half (57%) of respondents. Of that, 92% have seen their organization increase packaging needs due to the increase in online orders.

This has caused a need for increased inventory, warehouse space, material substitutions, and staff.

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REALITY 5:

SILVER LININGS IN SUSTAINABILITY

Almost all (94%) agree that sustainability is a key consideration in packaging and label decisions. 66% of respondents said they have shifted to more sustainable packaging than what was used previously. Interestingly, 55% of respondents said recent supply chain disruptions moved their companies closer to their carbon emissions goals compared to further away.

Expert take: Brands continue to use less material and are turning to recycled materials — both of which are helping them move toward more sustainable packaging. Due to limited supply of virgin fiber, now is an excellent time to conduct a structural design engineering review. We often see this due diligence translates into material usage savings through the use of lighter weight paperboard materials as well as a smaller packaging footprint.

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Reality Requires Willingness

There was a broad willingness to pivot to different packaging materials in light of recent industry challenges — over one third said they were extremely willing (36%).

And a majority of organizations (81%) did make changes to packaging design over the past 1-2 years.

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These challenges have forced organizations to reprioritize packaging materials (68%), reprioritize budget (52%), reprioritize packaging design and aesthetics (49%), and sustainability goals (45%).

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9 out of 10 respondents indicated that recent disruptions to the global supply chain have caused their organization to change how packaging is sourced; including:

• 62% that have moved to more diversification of suppliers
• 42% who have outsourced manufacturing/fulfillment
• 39% consolidated with fewer suppliers
• 30% substituted specs
• 26% reshored to the United States

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Over the past 1-2 years, the majority of packaging decision-makers are planning ahead by 2-4 weeks.

Expert take: Material availability disruptions, labor shortages, and transportation challenges will impact supply chain timelines for the foreseeable future. Know that advance notice is a powerful tool. A greater focus on forecasting, contingency plans, early order placement and acceptance of longer lead-times, these are all things that can help ensure availability and protect against those late-in-the-game disruptions.

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The top source of guidance or information on packaging is from suppliers/vendors or direct manufacturers, with 78% of respondents agreeing. Following that is industry associations or publications.