The packaging sector has so far maintained the lift it got from COVID-driven lockdowns thanks to significantly more parcels being sent as businesses moved online. The big question in the post-pandemic era is how this is playing out. As it happens, pretty well.
Premier Paper for one is still showing signs of strong sales in its packaging division despite the market decline in traditional postal communications. The company’s Packaging Sales Manager Chris Redstone says: “We aim to expand this area of the business further and become a one-stop-shop for customers and all their packaging requirements – whether that’s off the shelf or bespoke items. We continue to see year-on-year growth in envelopes and mailable items.”
Pukka Pads has also enjoyed a positive period over the past two years, with double-digit growth for its post and packing range and 2023 sales currently tracking 2022. For FY2021-22, the company saw one of the strongest performances to date in its bubble wrap segment. However, this is expected to become slightly more subdued due to the prevailing challenges within the UK economy.
The continuing war in Ukraine and inflationary pressures have put a definite pinch on the category, creating upward pressure on prices over the past 18 months. RAJA UK Managing Director Tom Rodda told Workplace360 the first half of 2023 has not been as buoyant as 2021 and 2022, both of which benefitted from lockdowns.
“We are still growing steadily and acquiring customers, just not as rapidly as before. In the next 6-12 months, RAJA sees the outlook as uncertain as consumers’ disposable income continues to be squeezed by inflation and interest rate rises,” he adds.
The e-commerce sector – a crucial market for the packaging industry – is being impacted by end-user wariness, but Rodda remains bullish: “We remain optimistic about prospects. The RAJA model is unique, and we are well-placed in the industry. After all, uncertainty should be seen as an opportunity.”
For tesa, packaging is a core competency and represents one of its heritage product groups. With online business parcel shipments increasing, the market for its packing tapes is on the rise, as is the demand for its sustainable tapes.
Back on track
After a brief hiatus during the pandemic, sustainable packaging is once again a big trend. Historically, the category was viewed as a prime environmental offender, but much has changed over the past two decades to rehabilitate its image. The importance of environmentally friendly materials will be further boosted with the introduction of the European Packaging & Packaging Waste Regulation (PPWR) and Extended Producer Responsibility (EPR) – two key pieces of legislation designed to address sustainability in packaging (read Regulating issues below).
Retail and e-commerce remain the driving force behind the movement to more eco-friendly materials as a result of pressures from consumers. B2B, on the other hand, is progressing at a slower rate, with price points still a key issue. The introduction of the Plastic Packaging Tax in April 2022, however, has seen suppliers and customers adjust their offerings and requirements respectively.
Premier Paper, for example, has ensured its bubble wrap, stretch film and polybags all contain a minimum of 30% recycled content. States Redstone: “We have witnessed a huge interest in self-adhesive and water-activated paper tape, especially printed with company logos and branding. In addition, we use cardboard boxes, paper tape and paper void fill and everything that can go into a household recycling stream. It gives a great environmental message to the end user.”
Making it easier
Sealed Air is responding to the demand for sustainable packaging with new product developments such as Bubble Wrap AirCap LRT and Bubble Wrap IB Recycled Content Films. Both are made using a minimum of 30% recycled content diverted from recovered waste. The company says this makes efficient use of all resources throughout the entire life cycle.
Antalis recently introduced its Green Star System and Green Card for packaging for the UK market, making it easier to access environmental information about goods. The Green Star System is a rating system grounded in a strict set of criteria, including recycled and bio-sourced material and technical recyclability that is measured meticulously and consistently.
The Green Card, meanwhile, provides in-depth environmental information such as reusability, greenhouse gas emissions, certifications and origin. Antalis Office Dealer Sales Manager Marie Challis notes: “We continually look for ways to enhance the products and support we offer to office and stationery resellers. By adding sustainability ratings, it has never been easier to select packaging materials, and there is a real opportunity for dealers to increase their client’s spend.”
RAJA also has a very strong environmentally responsible offering and is driving innovation in this area to meet and exceed customers’ expectations. Rodda explains: “We’ve broadened the sustainable assortment over the past few years to the point where, in some areas, whole ranges are sustainably sourced. More than 90% of our materials are procured within Europe – mostly in the UK – keeping service high and the carbon footprint down.
“Paper-based items are primarily FSC- or PEFC-certified, and we are raising the level of recycled content wherever we can if it doesn’t impact our high-quality standards.”
The reseller has also set ambitious carbon reduction targets, aiming for carbon neutrality by the end of 2024 and net zero by 2030.
In line with its 2025 targets, Pukka Pads is actively reviewing all SKUs to include more sustainable materials for physical products and, if applicable, external packaging. The company already uses at least 50% recycled content in all of its bubble wrap and bubble envelopes. All paper used in its envelopes is PEFC-accredited and cartons are FSC-certified.
For its part, tesa has developed carton sealing tapes to cater for consumers looking for more sustainable solutions and industrial customers seeking to meet corporate ESG goals.
Tesa Head of New Product and Business Development MU Consumer Hilde Cambier says: “Within the past three years, tesa has launched more sustainable carton sealing tapes based on post-consumer recycled PET backings, bio-based PLA backings and FSC-certified bio-based paper backings. All new packaging tapes are recycling-friendly and can be left on the carton, according to INGEDE Method 12.”
Industry experts that Workplace360 spoke to point to several key macrotrends affecting the sector, namely improving product protection, the precarious state of the economy, the need to raise brand awareness and processing efficiencies. At RAJA, custom-printed and custom-sized packaging stands out as an increasing trend as e-commerce businesses have matured to see the value of the ‘unboxing experience’ for their customers.
As Rodda explains: “Packaging is seen as a key pillar for these companies to promote their brands. The EPR for packaging legislation means firms with over £2 million in sales and handling more than 50 tonnes of packaging a year will have to pay for their branded packaging to provide for kerbside recycling. It will be interesting to see how many companies review branding on their packaging to avoid this tax.”
In the meantime, buyers are also looking at the total cost to pack, and labour shortages are a real consideration. Unit cost is less critical if the packaging saves time, so self-adhesive strips, crash lock boxes and custom mailers are becoming increasingly attractive. These protect contents well and provide a bespoke unboxing experience for consumers.
Pukka Pads has also had a busy year launching new products such as poly mailers, cotton string, tapes, parcel rolls and permanent markers. The company’s Stock & NPD Director Rochelle Stott says there will be continued expansion and development in this category.
Technology and digitalisation provide plenty of opportunities for suppliers, resellers and dealers in packaging. For example, a desire for personalisation has led to take-up in digital printing on corrugated boxes while automation within the industry is increasing.
On this latter point, RAJA is already developing its offering to meet this growing demand. Says Rodda: “RAJA’s core buyers are small to mid-sized businesses that typically have a wide number and size of parcels to fulfil. This presents challenges when they are processing 1,000-2,000 parcels a week. Our knowledgeable sales consultants are helping these customers get the most out of automation and finding alternative solutions if they will work better for the client in question.”
On 30 November 2022, the European Commission published a first draft update of the Packaging and Packaging Waste Directive (PPWD) as part of the Green Deal and the accompanying Circular Economy Package.
The new proposal, the Packaging and Packaging Waste Regulation (PPWR), is a European Union regulation to reduce packaging pollution and help build a circular economy. Once approved, it will apply throughout EU territory and to any imported packaging.
The new EU legislation will:
- Set targets to reduce packaging waste
- Set specific design requirements for recycle-ready packaging and the use of post-consumer recycled content
- Set ‘eco-modulation’ criteria for Extended Producer Responsibility (EPR) schemes that reward more sustainable packaging
If approved, the new regulation would mean that, by 2030, all packaging on the EU market must be designed to be recyclable. In other words, recycle-ready. By 2035, companies will need to demonstrate their packaging is recycled at scale. This requires having the appropriate recycling infrastructure in place.
Meanwhile, the UK EPR legislation for packaging has created obligations for organisations selling, importing and handling packaged goods as well as brand owners and online marketplaces. New registration, data collection, reporting and payment rules are being introduced for businesses placing packaging on the UK market. Reporting began in July 2023 for the first EPR submissions, requiring the submission of packaging data from H1 2023.
As part of a transition to a circular economy, these laws essentially push responsibility up the chain to producers of packaging to drive changes in design and consideration of its end-of-life treatment.