What are the challenges facing the global packaging industry?
Printing industry is predicted to top USD 980 Billion by the end of 2018, whereas the global package printing industry is estimated to grow from USD120 Billion in 2016 to USD192.75 Billion in 2026. Safe to say packaging industry contributes to about 12 percent of printing industry’s market share which means packaging and print industry are integral to each other. Print industry has of late been in a state of flux with the arrival of digital technologies, as traditional printing gradually shifts out of focus and is replaced by modern printing technologies like web to print. A no. of developers has come up with web to print storefront software to cash in on rise of this market. Packaging industry on the other hand has seen a surge in business thanks to rise in on demand services, particularly e-commerce that has boosted the market for packaging and logistics. Although there are still a few challenges that the global packaging industry faces
Industry specific challenges
Web to print is an example of industry specific challenge. anchored textWeb2print software is used for customizing a host of merchandise , including textiles, photo albums, coffee mugs, badges, decals, purse, keyrings, bottles, buttons, etc. by adding clip arts, texts and image uploads on to the product and getting it printed. The wide spectrum that these products cover in turn create a herculean task for packagers to tackle as different products require different kinds of packaging. A t-shirt cannot be packaged the same as a keyring for obvious reasons and it is hurdles like these that challenge packaging industry to adapt.
Another example is the pharmaceutical industry. Earlier the treatment procedure followed by the healthcare industry led to pharma companies manufacturing different medicines in bulk quantity and supply them over. But recently the approach has changed, now the treatment procedure involves drugs that counter diseases at micro level in accordance with the patient needs instead of bulk drug administering. This will certainly render the mass production technology for drugs obsolete. Naturally, that will change the packaging and logistics measures as the industry is forced to adapt.
Observing regulations for different regions of the globe
The bulk of regulations that the packaging industry has observe is another uphill battle. This issue is characteristic to the packagers because in case of other industries they have to observe regulations concerning only them individually. Packaging industry on the other hand has to observe rules and regulations observed by all of its associate industries. Any change in any associated industry will lead to packagers adapting accordingly, be it manufacturing industry, food industry, healthcare, retail industry, logistics and the list goes on. This is just the challenge to the business model of the packaging industry, there are several other issues that crop up during the course of operation.
One of those issues is abiding by the environmental regulations. When it comes to environment most administrations don’t offer leeway to industries. And owing to that packaging has to maintain a certain level of environmental protection standard for every industry and sector it is associated with. Every industry has different set of environmental regulations, some more stringent than the other, packaging has to make sure that it is in compliance with them all.
Rising cost of raw materials
The rising cost of packaging materials is another bane of the industry. As the demand for packaging rises so does the demand for the raw materials like paper, resin, paperboard, adhesives and films which are most commonly used in packaging. The supply for such raw materials hasn’t been able to keep pace with the demand and has thus led to surge in prices. For instance, polypropylene which used in bottles, packaging films, resins, has been in high demand with an inadequate supply leading to rise in its price. Paper too has seen its prices shoot up in recent times with a sustained rise of 7.5 per annum growth. These challenges on such fundamental level has severely affected the industry’s capacity to stay viable on a continued basis.
And despite the above-mentioned obstacles the global packaging industry is too big to go anywhere soon.
Even a developing country such as India has a packaging market of estimated USD 10 Billion and also shows promising signs of compound annual growth rate of 18-20%.
Source: https://www.globalcompliancepanel.com/freeresources/challenges-facing-in-packaging-industry
It’s not too hard to imagine the size of the global industry if these are the stats from just one country. The global packaging industry is estimated to hit USD 1 trillion dollars by the year 2020! Such huge no. associated with this sector is another factor why it still attracts new players in big amount.
