September 12, 2019
If history has taught us anything, it is that conventional thinking and the prognostications of “experts” are often wildly off the track—and far from the future that becomes reality. No one is driving to work in a flying car.
As we approach the year 2020, it is a good time to speculate on where the packaging industry is headed and make some semi-educated guesses as to what the next decade will bring. Our society and our economy are being transformed at an ever-increasing tempo, and these conjectures are simply for sport and a starting point for discussion. So, without further ado:
E-Commerce
As Amazon continues its assault on the world of traditional retailing, an expanding network of Amazon warehouses poses a major threat to the amount of packaging required to get the purchased items the last miles to the purchaser. With Amazon building more and more distribution centers closer to the consumer in major metropolitan areas, the requirements for protection decrease markedly. Expect to find more of your items arriving in envelopes as opposed to corrugated boxes. Every envelope represents one fewer box.
Digital Printing and the Advent of VR
Digital printing has been a godsend for marketers and producers of point-of-purchase displays. Gone are the multiple print jobs requiring tooling changes and slug replacement. Now, with a push of a button, you can switch from printing A to B to C with no discernible loss of speed or quality. The question of the viability, utility, and lifespan of digital printing becomes twofold: Where are you going to shop other than at a grocery or hardware store to utilize the capability of digital technology, and what will be the impact of the world of virtual reality (VR).
Poised to become the next big thing in technology, VR will let you enter a world that is interactive, three-dimensional, and lifelike. The standup display in the movie theater lobby and the Super Bowl display in the grocery store are now just holograms that require none of the services of a packaging company beyond the product packaging.
Converting Cycle
For those of us who have been around for a few years, a common metric for the plant was the amount of work booked and due for delivery. That gave management a quick way to see how the month was progressing and provided a quick snapshot of the likelihood of having a successful month. Today, if you ask the same question, the backlog is just a few days, with the order life cycle of date of booking to date of shipping now measured in mere days. This speedup of the order cycle forces greater organization, faster and more capable machinery, and better-trained technicians and operators on the factory floor.
Logistics
While the shortened order cycle has forced improvements in machinery and processes, the lag in the production cycle is the last link in the chain. Delivery costs have grown faster than any other expenses for many plants. Smaller orders delivered more frequently and delivered to a client base whose radius is constantly growing to provide the volume requirements for the plant is a recipe for cost creep.
Recycling
Corrugated board has gone from roadie to rock star since the internet and e-commerce came to prominence. While some other packaging materials are denounced as problematic and harmful to the environment, corrugated is the perfect solution—
it is incredibly strong for its weight, can be produced in a multitude of designs to ensure optimum protection, can be produced quickly at reasonable costs, and at the end of its intended use, it can be recycled, and the fibers that provide the internal strength can be reused over and over. A corrugated box that ends up in the ocean will biodegrade within two months.
Alternative Fiber Sources
Legalization of marijuana cultivation in many states opens the door to hemp production. Hemp for industry contains no hallucinatory properties, but it does contain very long fibers, has a higher yield than traditional pulp, is white by nature so it requires no bleaching, and if you’ll pardon the expression, it grows like a weed. Experiments are going on at several research and university laboratories to support introducing hemp into the fiber of packaging materials. Particularly in developing countries, hemp could become a consistent and viable source of packaging paper.
Trying to predict the future is a risky exercise. Hopefully some of the topics listed above have given you food for thought as to the direction of your plant and company.
John Clark is director of analytics at Amtech Software. He can be reached at jclark@amtechsoftware.com.
