Top five opportunities for flexible packaging


2011 FPA Awards - Fresh N Tasty Pouch

2011 FPA Highest Achievement Award winner - Fresh N Tasty Produce Pouch by Robbie Flexibles (Lenexa, KS)

Flexible packaging has a lot going for it in today’s ever-changing global marketplace: More types of containers, lighter weight, raw material savings, lower energy cost, efficient manufacturing, easy disposal. But what are the top opportunities for converters and their brand-owner customers in this $27.5-billion US industry?

Help to answer that question came in the form of the lead presentation at last week’s Flexible Packaging Assn. Fall Executive Conference held in Chicago. Speaking to the audience of 130 top-level industry professionals, Jeffrey Bornstein, vp of SAI Industrial, offered the results of some initial research his firm was commissioned to do for FPA. Final stats as well as projections to 2015 will be available next spring at the trade group’s annual meeting.

The importance of volume
SAI has identified both challenges and trends facing the US flex-pack field, focusing first on a comparison of 2002 vs. 2010. To get a better bead on how flexs packs compare to selected rigid containers (i.e. metal cans, glass bottles, corrugated and paperboard cartons), SAI developed a volume index rather than a straight dollar-sales comparison. The volume index factors in key issues such as lightweighting, inflation, and energy/labor/raw material costs to come up with a more useful market-share analysis, Bornstein says.

2011 FPA Achievement winner Cryovac

2011 FPA Silver Award for Technical Innovation - Cryovac Oven Ease Bag by Sealed Air Corp. (Elmwood Park, NJ)

For example, in terms of dollar sales only, the flexibles vs. rigid market share was relatively stable in the 2002-2010 period. Flexible packaging’s share of the total US market was 17.4% in 2002, rising only 0.7% to 18.1% last year. But indexed for volume, flexibles’ share was up a full percentage point. It doesn’t sound like much but actually equals $1 billion more in overall sales.

Taking a quick look at end markets for all forms of packaging, SAI found a huge 5% volume growth in retail-food packaging last year compared to 2002—even despite the recession. Flexible pouches and rigid-plastic containers made the biggest gains. Retail foods accounted for $48 billion in US packaging sales in 2010—up from $39 billion in 2002. Foodservice (institutional) food packaging was $12 billion in 2002, rising to $14 billion last year.

So, what are the top opps for flexible packaging? Here’s a checklist to keep handy:

  1. Unsupported plastic packaging films and sheets are up 3% in volume due to the ease of creating multiple sizes via flex packs. There’s been relatively rapid growth in retail and institutional food segments for these materials.
  2. Plastic and coated-paper bags are up 1% in volume due to increased multiple-web laminates and foils capturing a greater share from converted-aluminum foils. Specialty bags, pouches and liners are also driving flex-pack growth.
  3. For the now-burgeoning food markets, think of employing the following flex-pack characteristics: new plastic films, pouches, microwaveable packaging, packs sized for specific consumers; and private-label branding.
  4. Medical-device and pharmaceutical markets are also big on flexible packaging when it helps with private labeling, color-coded brands and varieties, and packs for concentrated products.
  5. High on brand-owner lists for just about any product (and thus easily able to fit with flex packs) are safety, consumer convenience, sustainability (source reduction, easy disposal), and a focus on lower prices.
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