The COVID Pandemic’s Effect on the Packaging Industry
Even though infection rates are decreasing in the U.S. and vaccines are being shipped around the world, we’ll still be dealing with the effects of the COVID-19 pandemic for some time. Computer chip and bicycle shortages are predicted to last until at least the middle of 2022, while there are smaller shortages across nearly every industry and supply chain.
The pandemic itself has also changed attitudes toward how we manufacture, package and consume products. But what are the short-term changes, and how will the impact of the COVID-19 pandemic affect the labeling and packaging industries going forward?
The Packaging Market Shifts Focus from Sustainability to Safety and Availability
Before the pandemic, manufacturers, consumers and municipalities were focused on reducing the amount of single-use plastic packaging, particularly in food packaging, entering the waste stream. Plastic shopping bags and straws were on their way out, while reusable bags and water bottles were on their way in.
Now that we have over a year of research on the spread of the novel coronavirus, we know that the risk of infection through surface contact is very low. However, that wasn’t clear for the first few months of the pandemic. Reusable packaging was seen as an infection vector, picking up virus particles as they moved from shops to the home. This led to increased demand from consumers for sealed packaging on everything, from produce to take-out foodservice.
At the same time, there was a massive increase in demand for medical and healthcare packaging. We’ve seen businesses temporarily change their product focus to survive, shifting from distilled spirits to hand sanitizer, from clothing to masks, and from car parts to respirators…and these products require packaging that meets strict requirements laid down by organizations like the FDA. (In fact, we covered this problem in our blog last year!
Suddenly, distilleries had to contend with medical regulations, as they switched from spirits to hand sanitizer production, so they could keep their doors open in light of the impact of COVID-19. At the same time, counterfeit products were entering the market, causing concerns over the safety and authenticity of these new products. This made correct packaging information critical in order to get items on shelves and avoid expensive penalties.
Even as the rate of infection goes down, and the low risk of surface contamination is known, consumers are reluctant to go back to reusable packaging. It’s also brought awareness for the need of production flexibility to adjust to market changes. This is forcing producers to rethink how they package and label goods.
E-Commerce Explodes, Increasing B2C Business
The COVID-19 crisis accelerated online sales growth for companies like Amazon, since consumers had to factor their safety into their purchases. If they buy something from a website, they can have it on their doorstep in a few days, without involving human contact.
These shifts increased the use of business-to-consumer packaging. If the majority of your sales are coming from online, packaging sizes have to take into account shipping requirements and costs, along with staying below weight and dimension limits. For some companies, this shift meant adding lines for the boxing and labeling of products that would be shipped to consumers. For others, it meant contracting third-party logistics/packaging companies to warehouse and ship products. This led to massive growth in the 3PL industry.
While the growth of online sales is slowing down, sales rates are unlikely to drop below pre-COVID levels. This makes B2C-focused packaging more important than ever.
Multi-Channel Shopping Changes Brick and Mortar Retail
The pandemic also led to a rapid increase in multi-channel shopping. In the past, this meant offering products both in stores and online. However, the market trend has now shifted to a new type of shopping in which consumers browse for products online, then buy them in the most convenient way possible.
If it’s available locally, they can pick it up in the store. If it’s not, they can have it shipped to their home, or to the store, for pick up. What was an emerging trend suddenly became a cornerstone of shopping, as consumers shifted to curb-side service and delivery purchases to reduce in-person contact. Even if customers were willing to go inside stores, they wanted to know if products were in stock before they risked going out in public.
During lockdown, brick-and-mortar retailers and grocery stores were forced to link their internal supply management to their online presence, tracking stock and displaying it on their websites. This led to changes in labeling, simplifying and expanding inventory tracking inside stores, while making every SKU available through every retail channel. Labeling became a major part of this strategy, allowing tracking through the entire retail chain, not just through warehousing and shipping.
Distance and Automation Becomes Integral to Packaging Market
One major COVID pandemic effect on packaging industry practices wasn’t on the packages themselves, but instead how they’re labeled.
Social distancing is key to reducing the spread of Coronavirus, as it will be during future epidemics and pandemics. This was made all too clear by COVID-19 outbreaks in meat packing plants; with little space between workers, one infection turned into hundreds in a matter of days. This forced manufacturing facilities to rethink their production lines, so they could spread out employees.
Automation isn’t just a matter of speed and accuracy, it’s also a matter of safety. If you take a worker out of the workplace, there’s more space for everyone, decreasing the spread of contagions. This risk reduction encourages businesses to make the switch to automated labeling sooner.
What Is the New Normal for the Labeling and Packaging Markets in a Post-COVID World?
Adding B2C packaging materials into your packaging line isn’t as difficult as it may seem, thanks to our 3600a-PA Series corner wrap printer applicator. It uses a print engine to add details to labels before they’re applied to containers. It can connect to your operating technology system, letting you track packages and print the correct label for each shipping box. By using a corner wrap applicator, a single label can cover two adjacent panels of a box, so it’s scannable and human-readable in multiple orientations.
Want to assure buyers that the bottle they’re buying is still sealed? Our Vertical Trunnion Roller labeling system is designed to accurately apply multiple labels to round bottles. Originally designed for bourbon, this machine can label nearly any glass bottle. Depending on the configuration, this machine can apply up to 5 labels on each bottle, including a tamper-evident label on the cap. This eliminates the requirement of a separate machine to apply cap seals.
We Have the Equipment Your Business Needs for Flexible Packaging and Labeling
Do you need to improve your labeling and packaging solutions for consumer goods? Are you changing your packaging to make it more recyclable, reduce plastic waste or improve sanitation? CTM Labeling Systems can help you make the transition with our labeling machines. We have local distributors that will work with you to set up a labeling system that keeps pace with your production lines and logistics, so you can get the results you want with the speed and accuracy you need.