The coronavirus pandemic has affected each and every industry in one way or another. The packaging industry, especially, has applications in numerous global sectors. Therefore, it is important to study the COVID-19 impact on the packaging industry.
Before the global pandemic, most of the packaging companies and stretch film manufacturers were working to fulfil sustainability goals. However, the pandemic has negatively affected such progress. Packaging companies that were trying to develop and implement modern technology to enhance sustainability and eco-friendliness of the processes now face some serious challenges.
The rising concerns about the hygiene and overall safety of reusable packaging have greatly slowed down the progress of the industry towards adopting modern sustainable solutions. It is easier to understand the impact of the COVID-19 pandemic on the packaging industry by discussing different types of packaging.
a. Transportation Packaging
The increase in the demand for industrial and transportation packaging is associated with the overall economic activities and production levels. During the pandemic, the GDP of most of the countries has seen a sharp decline, which means a significant reduction in packaging demand. However, at the same time, this effect has been offset to some extent by the fact that industrial customers are buying products and containers in huge quantities.
Similarly, packaging in some industries like food and medical supplies has not declined. In fact, the pharmaceutical industry has seen a huge rise in the packaging requirements due to the massive production of PPEs, face masks, gloves, ventilators, and many other such products. Moreover, increasing demand for corrugated packaging and stretch wraps in the e-commerce industry has made up for the demand lost in other industries.
b. Consumer Packaging
Due to the closure of hotels, restaurants, and food-service outlets, there has been a sharp decline in the demand for packaging in the food industry. However, a significant majority of the consumers are moving towards grocery purchases, which has increased the packaging demand.
Even at the start of the pandemic, most of the consumers started stockpiling a huge amount of food, beverages, and other necessary items. Yet, the demand for good premium packaging has taken a significant hit as most consumers are avoiding unnecessary expenses.
c. Healthcare Packaging
The demand for the packaging of healthcare-related products is rapidly rising. Stretch film manufacturers also see a sharp increase in the demand for stretch wraps and other items like flexible blister foils and rigid plastics that have applications in different parts of the healthcare industry.
d. Future Trend
It is important for the packaging industry and the industrial bags and film manufacturers to be ready for the ramifications of the COVID-19 pandemic in the next months and even years because it will take a significant amount of time to get this global pandemic under control. The crude oil prices are falling due to the pandemic, and hence, the cost of oil-based raw materials like plastic resins will also decline.
Moreover, border closures are creating certain challenges to the packaging companies because it has disturbed the entire global supply chain. There is a lot of uncertainty about this entire crisis. As a result, the actions of different governments can be quite unpredictable, due to which the packaging demand is also expected to remain disturbed in the foreseeable future.
Now that you have become familiar with the COVID-19 impact on the packaging industry, it is highly important that the companies and manufacturers make the right strategies to sail through this global pandemic.
It is highly important that stretch film manufactures and other packaging companies rely on authentic and reliable information to make useful risk mitigation strategies. For this purpose, the packaging industry should consider creating a united crisis-response centre that will analyze the available information and recommend efficient strategies for the benefit of all stakeholders.
The primary goal of the industry should be to protect the health and safety of the employees. As a result, it is important that packaging manufacturers reevaluate their production and manufacturing techniques. Moreover, the companies must understand the disruptions in the global supply chain to avoid the adverse impacts of the pandemic.
The Bottom Line
Certain aspects of the packaging industry have definitely taken a hit during the pandemic. It is important that the leadership teams in this industry develop effective recovery strategies.
Such strategies include making comprehensive financial plans, operational plans, and any important changes that have to be made at the production to restart manufacturing activities.
Ultimately, with such strategies, the impact of the COVID-19 pandemic on the packaging industry can be mitigated to a great extent.