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Eat, Drink, Grow

By AICC Staff

March 12, 2020

Boxmakers are poised for growth over the next five to 10 years, according to two recent industry studies. One of the primary drivers for that growth will be food and beverage packaging.

“The growth in [the] global corrugated packaging and containerboard market is [attributed] to various factors such as … [an] expanding food and beverage market,” notes a study by Koncept Analytics, titled Global Corrugated Packaging & Containerboard Market Report: Insights, Trends & Forecast (2019–2023). Notably, North America was singled out for contributing the largest share of that growth, “due to rising domestic product and growing demand for packed food and beverages.” Specifically, the study points out, “The market is expected to experience key developments like higher demand from the processed food market and fit-to-product characteristic of the corrugated box.”

Additionally, research firm Frost & Sullivan suggests that, globally, food and beverage packaging is expected to reach $368 billion by 2030. While that total represents all forms of packaging materials, boxmakers—creators of recyclable, sustainable containers—will have a clear edge as their clientele continue to source environmentally responsible products.

Making the most of these opportunities means tapping into a diverse range of growing markets.

Tapping Into Trends

For Rob Callif, president and chief operations officer at BCM Inks, four main trends have been driving the company’s growing food and beverage business: e-commerce, the growth of microproducers, increasing interest in a variety of healthier options, and the impact of personalization.

“Since convenience is of high importance to consumers, e-commerce will continue to grow, with companies like Blue Apron delivering food and beverages to a consumer’s door,” Callif says.

“When it comes to new or growing markets, the craft beer business definitely has been a boom.” However, Callif notes, it isn’t just about beer. “Microproducers not only include microbreweries, which will continue to grow, but also microdistilleries, because consumers want localized gin, vodka, etc.”

While healthy food and beverage options have been around for decades, Callif is still seeing expansion in this area as more and more companies respond to shifting consumer tastes. “There have been more health-food products and more diversity within food and beverage options,” he says. And when it comes to the recent popularity of personalization, he points to the impact of Coca-Cola’s promotions, which involve printing people’s names and university names on its cans. “We’re only going to see a greater demand for personalization moving forward.”

Sumter Packaging has also addressed the expanding needs of niche distilleries.

Matt Whitlock, a packaging design engineer for the company, says, “Over the last year or two, the spirit business seems to be bringing in a lot of regional companies, mom-and-pop distilleries that are making their own vodkas and other flavored spirits. We’ve always handled spirits businesses, but now we’re getting more smaller companies.”

Niche distilleries are joining a range of regional customers served by Sumter Packaging. “Regionally, we’ve also got a couple of big honey customers in the area. Other specialty foods include jams, popcorn in various flavors, and energy drinks,” Whitlock says. While these markets may not reflect national trends, they highlight the unique opportunities that come with being a regional corrugated boxmaker.

Exploring Your Own Niches

Like most segments of the marketplace, when it comes to food and beverage, no one company’s experience can speak for all. For example, while localized beer and spirits have been a boon for some, they have had little impact on the kind of display work typically handled by Peachtree Packaging.

“Craft beer hasn’t really been significant for us,” notes Paul Terry, Peachtree Packaging’s display division manager. “I think a lot of microbreweries are still too small in size to best utilize what we offer,” which can include displays featuring lighting, electronics, sound, and motion. Although some permanent displays feature wood, acrylic, and wire, Terry says the company prefers to focus on corrugated.

“We do get custom orders for

limited-release specialty beverages, but those probably fall more into the category of a marketing piece for an event rather than a display,” adds Pete Galbiati, Peachtree’s director of marketing. “Ninety-nine percent of the time, the distributors for these products don’t have a big enough retail footprint to roll out a display or packaging solution. But there are definitely a lot more of them in the marketplace. We get a lot of inquiries from people, but most of them are just testing the waters.

“When I think of growing markets for us,” Galbiati continues, “one of the most significant recently has been shelf-ready packaging for the bakery side of the business.”

That doesn’t mean the company is ignoring the beverage side of food and beverage. The focus just happens to be on serving larger distributors rather than niche or local producers. “We do a lot with boxed wines from some of the bigger groups,” Galbiati says. “Just in the last year, we have seen a trend for boxed spirits [and] liquor. We have also done a lot of dual promotions on the beverage side, cross-promotional beverage displays featuring multiple products from the same distributor [or] manufacturer. They’ll feature a beer and spirit or a spirit and a mixer on the same display.”

One of Peachtree Packaging’s most innovative beverage displays won the company an AICC Independent Package Design award in 2019 for the best use of corrugated replacing other substrates. The display, shaped like a large vertical coffin, was produced for Black Box Wines. Given the weight and shape requirements of the product, other companies might have taken a different approach. But Peachtree’s commitment to corrugated paid off.

That commitment has inspired a number of innovative market solutions for growing the company’s food and beverage business.

Getting Creative

“Part of the reason the Black Box wine display was so popular was the fact that we gave the client a different way to display 24 boxes of wine,” Galbiati says. “They started out wanting a permanent wood display, and we showed them we could build it out of corrugated instead and still hold their 300 pounds of product. Our unique design, combined with high-impact graphics, really stood out in the marketplace. And it highlighted some of our key strengths—our ability to come up with innovative ways of replacing different substrates with corrugated, being environmentally conscious in the materials we use, and producing displays that are recyclable.

“We really wouldn’t be able to do all of those things if we didn’t have a good design and engineering team,” he adds. “They make it possible for us to provide unique solutions.

“People sometimes come to us and know exactly what they want us to make. But other times, we have the opportunity to change how things are typically being done,” Galbiati says. “With our design lab and what we can do from a sampling standpoint, we can make physical displays or products that highlight new approaches that can exceed the client’s expectations and stand out in the marketplace.”

Innovating Opportunities

Creative thinking can lead to previously untapped—and even unknown—segments of the food and beverage market.

“Most recently, we’ve been doing more in the agricultural space,” Galbiati says. “Over the past year, we’ve developed some patent-pending designs in fruit baskets that allow some of the big growers who sell food directly from where it’s grown to have something brandable and recyclable. This was generated from a need we saw in the marketplace.

“When it comes to packing fruit, there wasn’t really a solution for peaches, apples,” he explains. “Basically, they had plain wicker baskets. But the on-site sales industry for some of these growers is huge. So we created corrugated, branded baskets that can even tie into [the growers’] social media.”

Peachtree’s design team considered every element of the proposed box, from its overall strength to the height of the handle, and even its breathability once filled. “Brandability and storage were also important features that were value-add from the traditional solution,” Galbiati says. “When people pick peaches off their farms, they now have a branded basket that has capacity and strength and can be stored and stacked.”

The company’s willingness to address customers’ needs in innovative ways was driven, in part, by the ever-increasing desire on the part of customers for products that are both recyclable and sustainable.

Frost & Sullivan noted in the 2019 study titled Global $368 Billion Food and Beverage Packaging Market, Forecast to 2030 that “packaging is important for end users and suppliers alike. As consumers are increasingly becoming environmentally conscious, concerns around plastic pollution, specifically, are growing. Viral videos and images of plastic waste affecting marine life and polluting the Mariana Trench have made combating plastic pollution the topmost priority for consumers.”

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Peachtree Packaging’s coffin design for Black Box wines was one of the clear standouts at AICC’s 2019 Independent Package Design Competition. (Photo courtesy of AICC.)

“A lot of people are getting away from single-use plastics and other nonsustainable materials,” Whitlock points out, “looking for solutions that replace materials that can’t be recycled. That’s challenged us to develop other solutions. For example, a customer had a display that held energy drinks, but it used plastic clips to help support the shelves. We collaborated with the customer to eliminate the plastic while still handling the bottle weight. Demand for products like that is only going to continue. Single-use plastic use is being looked at hard. I think there’s still opportunity for innovation.”

Branding for Success

Regardless of the market segment, branding is key. And one of the essentials of effective branding is the use of inks and other elements that deliver high quality. “If the package is bright, accurate, and consistent, it’s a powerful way to differentiate products and help establish identity in the marketplace,” Callif says.

A number of qualities make an ink the right ink for a particular food and beverage application. “First,” Callif says, “the inks need to be environmentally correct. Sustainability is important to food and beverage companies, which goes beyond just the recyclability of the box.

“Second, most inks are designed for indirect food contact—99% of corrugated is for indirect food contact—so they do not have to be approved by the FDA. But if an ink or varnish is touching the food, then an FDA-approved ink or varnish is required.

“Third, color accuracy is extremely important across the print runs. Food and beverage companies do not want to have two of the same display on a shelf and have one look different from the other; Coke red needs to be Coke red.

“Fourth, some companies require a barrier-type function to their box or display, which can mean alcohol resistance, rub resistance, or water resistance.”

Finally, Callif says, “A lot of printers and their vendors, such as ink companies, are getting audited for traceability purposes, so you need to make sure you have good manufacturing processes in place. In order to help out with traceability, at BCM we have bar codes on all of our products that go to printers so they can trace the batch being used on a print job.”

Growing Your Reach

With the right balance of elements in place, boxmakers will be well equipped to make the most of whatever food and beverage opportunities arise through previously untapped local markets or larger market trends that bring new customers and inspire new solutions.

“The good news about food and beverage is that people always need to eat and drink,” Callif says. “I’m definitely optimistic about the future for food and beverage packaging.”


RobertRobert Bittner is a Michigan-based freelance journalist and a frequent BoxScore contributor.