Finding Opportunity in Flexible Packaging's Growth
Can consumers really get used to the idea of pouring their breakfast cereal from a zippered, flat-bottomed flexible pouch instead of from a crumply plastic bag tucked in a stiff-sided cardboard box? Some already have, and as more do, properly equipped and market-smart converters of flexible packaging should have a brimming bowlful of opportunity to dip their spoons into.
Taken together, paperboard and other kinds of rigid packaging remain predominant in food and other consumer product categories. But, flexible materials are on the rise as versatile, attractive and cost efficient alternatives to them. A study from The Freedonia Group forecasts that as demand for replacements to traditional rigid formats increases, the U.S. market for converted flexible packaging will increase 3.2% a year to $21.7 billion in 2021.
Similarly, at the recent Digital Packaging Summit, analysts Jennifer Dochstader and David Walsh (LPC, Inc.) projected that flexible packaging, growing at 3.4% annually, will account for better than one-third of the volume of the U.S. packaging market by 2022. They said that growth is being driven partly by the fact that “label and folding carton losses in some sectors are flexible packaging gains” — for instance, the “eradication” of primary/secondary packaging combinations like bottle-in-a-box.
Toronto-based Covertech Flexible Packaging pushed ahead of these trends in 2017 with a $10 million capital investment that included a 10-color, 65˝ flexographic press from BOBST, a co-ex extruder line, and pouch- and bag-making machinery. Don Habibullah, VP and GM, says that printing and converting technology for flexible material has advanced to a point where the quality of pouches and other flexible containers rivals that of packages from any other process.
But, it isn’t just about good looks. Converters succeed when they “deliver value to the market by adding functionality to the pouch” in the form of zippers, spouts and other fitments that make pouches easier and more convenient to use, according to John Minagawa-Webster, a product portfolio manager for pouches, multipacking and MAP (modified atmosphere packaging) at R. A. Jones, which manufactures form, fill and seal equipment.
He says that Daisy brand sour cream enjoyed a nearly 70% increase in sales after it switched to a squeezable inverted pouch that stands on its cap, breaking sharply from the way dairy products are usually packaged. Consumers, especially those in developed economies, are willing to pay for innovations like this, Minagawa-Webster notes.
According to the Freedonia report, demographic and lifestyle factors such as shrinking household sizes, the rise of dual-income families, and snacking in place of traditional meals will strengthen demand for pouches in small or single-use sizes. Protecting food from contamination, extending shelf life and enhancing visual appeal are other areas where flexible packaging can potentially shine.
Freedonia Group analyst Ellen Kriz writes in an email that flexible packaging’s inherent advantages over rigid packaging formats include lighter weight for reduced shipping and transportation costs; more efficient use of shelf space in stores; and more convenient storage for consumers. Add to these virtues, says Habibullah, the ease of recycling flexible materials such as polyethylene.
Stand-up pouches will see the best growth opportunities in food market segments such as meat and poultry, pet food and frozen food, according to Kriz. She also sees growth ahead for unit-of-use side seal pouches in pharmaceutical and chemical packaging as resin technology improves.
Resin processing is another competitive edge for Covertech, which buys the raw material and turns it into multi-layer films for stand-up pouches, juice, wine and spirit bags, and polyethylene bags fitted with a variety of gussets, welds, and wickets. The company makes 30 to 35 million pounds of flexible films annually, and in all of it, Habibullah says, “we have quality control right down to the resin.”
He sees a highly diversified range of consumer products as ripe for repackaging in Covertech pouches and bags: flour, fertilizer, adult diapers, snacks, and especially pet foods. Minagawa-Webster believes cereals are “primed for disruption” by migration to flexible packaging, predicting that the big cereal brands will follow the lead of the premium granolas and other dry foods that have already made the move to stand-up pouches.
Momentum is building not only as a result of consumer trends, but also because of significant advances in the performance and print quality of flexible packaging. High on this list, according to Kriz, is the development of high barrier packaging in thinner gauges and in transparent varieties that better display the product inside. Specialty film types such as MAP and self-venting film are other notable achievements on the materials side.
The kind of breakthrough that Habibullah appreciates is the smartGPS plate mounting system that came with Covertech’s newly installed 20SIX CS wide-web flexo press from BOBST, now being brought on line for production.
As he describes the system, a scanner captures “the topography of the plate material” and sends the map to an RFID chip embedded in the plate sleeve. The RFID chip transfers information that automates the setting of pressure, register, and other press parameters for each particular job. This solution, says Habibullah, “lets you bring the press into run mode with next to nothing in setup waste.”
The press, which he expects to have fully up and running by the end of the year, can print a 65˝ web at up to 600 meters per minute with repeats from 14.2˝ to 47.2˝. An encoding feature enables it to re-run a printed web for an additional application in correct register — useful, for example, in jobs requiring a clear matte coat over the window portion of the package.
Converters will need precision printing tools like these if they are to take full advantage of the rising demand for flexible packaging.
What consumers expect from flexible, according to Minagawa-Webster, is the same as what they are used to getting from the rigid formats — a wide range of good-looking packages to choose from. He says converters can and should learn from this model, because “there is a direct correlation between the longevity and the staying power of a brand” and the premium look and feel of its packaging.
Kriz sees this kind of quality in emerging production technologies now being utilized by manufacturers of flexible packaging. “Converters are increasingly adopting digital printing techniques, which allow for more unique, high-end images,” she says. “Digital/flexo hybrids are also growing in popularity and can be used for embossing, hot and cold foiling, and sub-surface printing.”
Digital, however, has limited application in the long-run world of consumer product packaging, the flexible segment included. Habibullah says that while the quality of digital printing is good and opportunities to use it exist, there aren’t many of them for a high-volume producer like Covertech.
If there is any resistance to switching from rigid materials to flexible ones, where is the pushback coming from? Kriz doesn’t think there’s much of it. But she notes, like Minagawa-Webster, that if flexible packaging is to compete successfully with other formats, converters will have to pay close attention to structure and appearance.
“In some cases, rigid packaging is thought to convey a more premium image,” she says. “For example, flexible packaging penetration has been more limited in the beverage market than in food packaging because consumers tend to view drinks packaged in glass or plastic bottles as higher quality than those packaged in pouches.”
According to Habibullah, “a lot of guys in the paper industry” understandably aren’t happy about the “major shift in raw material supply” that the rising demand for flexible packaging represents. But, he says it’s what consumers want. It’s certainly what converters like Covertech can profit from providing to brands flexible enough to think outside of the boxes and other rigid packages that they’ve defaulted to for so long.
Related story: Flexible Packaging Still on the Upswing