Plastics manufacturers are playing more critical roles than ever in the development and rollout of sustainable packaging innovations, but they're feeling the squeeze, both from gargantuan retailers and consumer products companies, and from raw materials suppliers.
As companies across the supply chain look to cut costs and gain efficiency, it is becoming more important than ever for packaging companies to find ways to position themselves to take advantage of opportunities.
Those were among key trends spotlighted at the annual Packaging Strategies Summit Meeting, held Feb. 25-27 in Clearwater Beach.
Sarah Corp, director of Troy, Mich.-based Clear Seas Research's packaging division, and David Luttenberger, publishing director of Packaging Strategies, shared results from a December survey indicating that collaborative projects will continue in 2009, despite widespread economic concerns.
Only 16 percent of those surveyed said the economy would stall this year's packaging development projects. More than half — 52 percent — said they would proceed with smaller budgets, and 32 percent said the economy would have no bearing on product development decisions.
Behind every packaging innovation, the concept of sustainability for both economic and environmental reasons is at the forefront, several conference attendees said.
“When you put sustainability in terms of process efficiency, it means lower costs and greater margins,” Luttenberger said in a telephone interview after the event. “While everyone likes the social equity, right now what's really pushing the sustainability initiative forward is that people are looking at ways to reexamine everything they do and finding more efficient ways to do it. You have to look at every way you can grow that bottom line,” he said.
Speakers from DuPont Co. and Procter & Gamble Co. spoke at the summit about the importance of sustainable developments and the importance of forging partnerships for new product launches and packaging redesigns.
To be among the plastics processors that will benefit from new design initiatives, manufacturers need to be willing to invest in new technologies to keep up with the needs of “demanding” retailers and consumer packaged goods companies, Greg Myers, managing director of Milwaukee-based private equity firm Mason Wells, said in a telephone interview after the meeting.
Myers said large, integrated plastics manufacturers are in a position to work with the big players, but that middle- and small-market companies are getting squeezed by pricing demands from both resin suppliers and their large customers.
“I see that as an opportunity to invest in innovation to meet the expectations of customers,” Myers said.
When large consumer packaged-goods firms want to change their packaging, “they're going to look at existing vendors if the solutions work, but if they can't, in this day and age they're not afraid to go out and get it from someone else,” he said. “That's especially the case if you're going from rigid to flexible — blow molders to a pouch. If you're the packaging company, you have to be innovating and keeping up.”
Dave Carlstrom, vice president of global packaging design and innovation at Clorox Co., said at the summit that his company is developing decorative, high-functioning packaged products that consumers will keep on display and not hide in their household cabinets. The national rollout of a more aesthetically pleasing container for Clorox disinfectant wipes also is under way, he said. Clorox is based in Oakland, Calif.
“[Clorox is] talking about the delivery vehicle as important,” Myers said. “They have to have packaging companies willing to invest in work and research to develop better products. They have to invest in [research and development] and engineering capabilities to be able to meet those needs in the market. They have to understand, and they have to invest, in order to be a long-term player.”
Feelings among the players in packaging remain predominantly positive in 2009.
“I felt really hopeful,” Corp said in a post-conference interview. “I felt like the industry is more optimistic than what I thought when I got [to the summit]. That's a good thing. It shows you what people are made of, and what's important.”