Packaging Innovations Continue: Key Takeaways From the 2023 Global Pouch Forum
Having attended my fifth Global Pouch Forum, I can report that the packaging industry is full of energy and optimism for continued growth, specifically in flexible products. At the same time, there are still several key issues that are affecting converters, printers, suppliers, CPGs, and brand owners alike. Here are my three takeaways from the 2023 Global Pouch Forum.
1. Versatility, cost savings, sustainability, and overall need for more pouches in packaging continues to grow through product innovation
Featured speaker, Sal LaMartina at Big Easy Blends demonstrated that the packaging market is desperate for product innovation that provides ease-of-use, portability, and an overall smaller footprint. Pouches do JUST that. Furthermore, this trend may be even more prevalent and rapid on an international scale, as featured speaker, Mohammed Nadeem discussed how Paharpur 3P converted Hindustan Petroleum’s (HP) rigid HDPE plastic container into a consumer-friendly, tamper-proof, and more sustainable stand-up pouch, proving there is a large untapped market for more flexible packaging. Lastly, I noted, Sonoco’s new line of paper-based pouches (ENVIROFlex) demonstrate the constant innovation in this growing subsector.
2. Sustainability is still a major pain point
As discussed in depth by the “Future of Recycling for Flexible Packaging” panel, sustainability and the circular economy continue to be a important topics of discussion. Regulators, consumers, environmentalists, packaging companies, CPG companies, and recyclers seem to be in a feedback loop: brand owners continue fielding requests from consumers for more sustainable packaging. Converters / suppliers take the necessary steps to deliver the technology and innovations to meet the consumers’ needs. Brand owners are hesitant to invest in new solutions without improvements in recycling infrastructure. The recycling players are hesitant to take any major steps towards building out the necessary infrastructure until they see the demand and economic viability. Various demands will continue driving innovation and growth in the flexible packaging industry, but a recycling “solution” is still up in the air until all parties come together.
3. Flexible packaging continues to be a very attractive investment
The industry continues to experience healthy growth driven both by increased consumption for packaging products and by product innovation, causing more products to adopt a flexible packaging solution. The packaging industry has also shown a strong resilience against swings in the economic cycle, reducing the risk profile of any investments. A third factor is that the packaging industry is still very fragmented, creating great opportunities for consolidators to create value. Private equity firms in particular, view flexible packaging as one of the hottest sectors to put their investment dollars to work and love the ample acquisition target opportunities. In addition, industry / strategic buyers are chasing production capacity and are willing to pay for it via an acquisition versus waiting for new equipment with long lead times, full production buildouts, and finding / training new production employees.
It was great to have converters and brand owners back in the same room again to discuss recent successes, individual challenges, and overall industry trends as we continue to navigate the ambiguous 2023 environment. The TKO Miller packaging team will continue to stay in touch with its various industry contacts and monitor major trends, such as labor and raw material pricing and plans to attend similar events later in 2023, such as the Pack Expo from September 11-13 in Las Vegas, Nevada.