State of the Industry: Flexible Packaging
The convergent forces that have emerged to make flexible packaging among the most dynamic and high-growth segments of the industry have continued, with converters, brands, and consumers driving its upward trajectory. The portable, resealable, protective, and — despite prevalent anti-plastic pushback — sustainable elements of flexible packaging have helped lead the segment to record growth, including a 12.1% sales increase from 2020-21, according to the Flexible Packaging Association’s (FPA) 2022 State of the Industry report.
This jump marked a spike from $34.8 billion in 2020 sales to $39 billion in 2021, much of which can be attributed to COVID-19-related buying habits that have carried over into 2023, even with the rollback of the restrictions that marked the early days of the pandemic.
“There was significant growth in e-commerce, and that continues to be a huge driver,” Alison Keane, president of the FPA, says. “Even after the pandemic slows down or goes to an endemic, people are still used to picking up groceries, they’re used to having groceries delivered. People who already got durable goods delivered are expanding what they are ordering online, and folks that never did it aren’t really going back to shopping normally yet and may never.”
Innovation Enhances Functionality
Among the key drivers of flexible packaging’s growth is that its non-rigid nature allows it to do things other packaging formats cannot. Keane says flexible packaging’s functionality has helped drive growth in the food segment, which at about 60% comprises flexible packaging’s top segment. But coming in at No. 2 is the medical and pharmaceutical market, which Keane says has seen significant growth in recent years, surpassing $5 billion in annual sales.
Medical devices within doctors’ offices and hospitals are a substantial segment for flexible packaging, Keane explains, particularly as patients return for elective surgeries — an area that saw a steep drop off during the pandemic. But beyond being used for product protection and transport, innovation in flexible packaging functionality is driving its growth in the medical realm. For example, the 2022 Highest Achievement Award, the top prize in the annual FPA Flexible Packaging Achievement Awards, was presented to Trevor, Wisconsin-based Vonco Products for its patented EnteraLoc medical device, which utilizes flexible packaging to deliver nutrients to
The system connects a flexible pouch to the specially designed ENFit connector to create what Vonco describes as a leak-proof, closed-loop enteral feeding process that utilizes the various components to provide nutrients directly into the feeding tube, making the process easier for patients and healthcare providers.
The Role of Digital Print
While structural innovations are resulting in unprecedented flexible packaging functionality, innovations in print are also leading to new opportunities. Flexographic printing has long been the top technology for flexible packaging production, and according to the FPA’s 2022 State of the Industry report, remains in the top spot with 72% of flexible packaging shipments being flexographically printed. Flexography has also seen its own renaissance in terms of increased speed, automation, and print quality, and it appears poised to remain the most prevalent print option as new technologies continue to emerge in this space.
Even though it’s gaining noticeable traction in other packaging segments, digital printing has been slower to take off in flexible packaging. But, as the FPA report’s findings reveal, digital adoption is on the rise among flexible packaging printers, with approximately 19% of printers stating they had digital capabilities as of 2021. While the share of total printed flexible packaging output is only minimally digital at less than 1% of shipments, the opportunities and advantages that the technology can provide are apparent.
Among the most prevalent users of digital printing technology for flexible packaging is ePac, a company that emerged in 2016 with a business model based entirely on digital flexible packaging production at a single location in Madison, Wisconsin. In the seven years since, ePac has expanded to 26 locations around the world, with plants on five continents.
Jeff Jacobs, ePac’s VP of marketing, says part of what plagued digital printing in the past is that it was slower and more expensive than conventional print. However, with technological advancements resulting in faster digital printing platforms that allow for cost-effective short-run production, the lingering negative perceptions are diminishing.
“We’re in a new place now from where we used to be several years ago, and we’ve evolved from that historic slow and expensive [production] to fast, cheap, and higher quality,” Jacobs says. “So, we think in the market, the [brands] we’ve been talking to about it, are recognizing that, ‘Hey, this is something that is revolutionary and is something that is really different from what it was before.’”
Because digital printing was slower to catch on in flexible packaging compared to other segments, smaller brands were often deterred from using flexible packaging, due to the large minimum order quantities necessitated by flexography. However, now with digital flexible packaging production a reality, Jacobs explains that startups, community-based brands, and larger brands seeking creative short-run opportunities have all been able to benefit from digital printing.
An example of a startup brand that has maximized the ePac platform, Jacobs says, is Granarly, an Austin, Texas-based company that produces whiskey-baked granola, packaged in resealable flexible pouches, and designed to take on the go. The digitally printed pouches can be produced in short runs and feature vibrant illustrations and eye-catching designs that can compete visually with much larger brands. Morgan Potts, the founder and CEO of Granarly, came up with the idea while in college, and is now on the verge of having her product on shelves in major national retailers.
Despite the positive tailwinds propelling flexible packaging’s growth, sustainability marks a distinct challenge for the industry — particularly regarding the pushback against single-use plastics. For many consumers and brand owners, the sustainability conversation tends to focus on recyclability, an area of struggle for plastic and multi-layer flexible packaging. While many of these structures can technically be recycled, it is generally required that they enter a separate stream via in-store drop off, as opposed to being collected curbside with other recyclable materials. Given the added burden in-store drop off places on consumers, most flexible packaging gets discarded with household trash and sent to landfills.
Because consumers can clearly see their discarded flexible packages are not picked up for recycling alongside paperboard, glass, metal, and rigid plastic packaging, a common misconception persists that flexible packaging is less environmentally friendly than other packaging formats. The reality, however, is that flexible packaging does offer distinct sustainability advantages, including its ability to maintain food freshness and reduce food waste; its lightweighting attributes, which allow more product to be shipped in a single vehicle and cuts down on emissions; and, in many cases, its ability to be produced using fewer resources.
However, Keane says recyclability and utilizing post-consumer recycled (PCR) content remains top of mind for brands, consumers, and legislators. In addition to voluntary initiatives, brands are instituting, various states — including California, Oregon, Maine, and Colorado — are either implementing or exploring extended producer responsibility laws that will require brands to adhere to specific recycling goals.
“We have to continue to design for full circularity,” Keane says. “FPA on our advocacy side is continuing to push for investment in infrastructure here in the United States to make that possible. So, if it is recycle-ready or a recyclable pouch, that it’s going to get recycled. If it’s a compostable structure, that there’s enough industrial composting in the United States to collect it and get it composted.”
While traditional recycling is often at the crux of how consumers perceive sustainability, progress is being made on implementing other waste management processes that emphasize circularity. The Consortium for Waste Circularity (CWC), which is led by Mike Ferrari, a former Procter & Gamble research and development director and current president of brand packaging consultancy Ferrari Innovation Solutions, is emphasizing the use of regenerative gasification of waste and discarded packaging, and using the resulting syngas to produce methanol, a feedstock for plastic packaging and products.
Ferrari explains that part of what led to the formation of the CWC is the low recycling rates reported by the Environmental Protection Agency. He shares that carton board and corrugated board comprise the most recycled material at 68%, while plastics is the lowest at just 9%, a statistic that has resulted in efforts to reduce or even ban plastic.
“What the Consortium is really saying is, ‘Let’s get the problem definition right and let’s go after a really comprehensive plan,’” Ferrari says. “One of my personal statements is, ‘Instead of focusing on a world without plastic, we should focus on a world without waste.’ If you focus on a world without waste, then we end landfills. And landfills are the third highest emitter, according to the EPA, of methane gas. Methane gas is 87 times more potent than CO2 emissions.”
Working with Dr. Bruce Welt, a professor of packaging engineering at the University of Florida, the CWC and FPA are endorsing trials of the regenerative gasification process in packaging waste. The process works by collecting any remaining material left behind after traditional recycling. Any organic material is fed into a downdraft gasifier, which provides a closed chamber at 1,400 degrees Celsius, breaking down the covalent bonds of the carbon and hydrogen in the organic matter to create synthetic gas.
A multilayer flexible package in this process, such as a potato chip bag that includes an aluminum layer, would then require the metal component to descend into a second chamber at 2,000 degrees Celsius, the temperature at which metals melt. The metal or glass that passes into the second chamber can be collected, while any remaining unformed syngas is also collected. The syngas can then be used to create what the CWC refers to as Eco-Methanol, which serves as the base material in the creation of plastic packaging and plastic products.
“You can do many things with syngas,” Ferrari says. “We’re proposing methanol. Methanol has many uses, and you can [use it] not just [for] packaging, but also products like diapers, toys, and on and on, which then become waste again and go through the upper [gasification] stream and you get the circularity.”
The Industry Presses Onward
While the transition to a process like regenerative gasification would be a long-term endeavor, by conducting immediate efforts, including working with government entities and continuing advocacy and education initiatives, Keane says the FPA and flexible packaging industry have an opportunity to improve flexible packaging collection and recycle rates, which in turn, will improve the general public’s perception of plastic and packaging overall.
“I think if we close that last gap of circularity and get our packaging collected and recycled, whether it’s plastic, paper, foil, or a combination, then we’ve answered the call and I think the anti-plastic and anti-packaging sum of it will dissipate,” she says.
Jacobs says that in addition to focusing on improving recyclability for flexible packaging, it’s important to focus on sustainability efforts in the production process. At ePac, this includes reducing waste via digital printing, and cutting CO2 emissions by using VOC-free solvent laminations.
“No product is perfect, but you do the best you can to have the greatest impact on sustainability and on the environment,” he says. “That’s something we definitely have front and center in our mind in the work that we’re doing when we’re looking at materials, when we’re looking at our processes.”
Cory Francer is an analyst at NAPCO Research. He formerly served as editor-in-chief of Packaging Impressions.