2020/02/17 Executive Forecast: The Path Forward in 2020 (part 1 of 3)

Executive Forecast: The Path Forward in 2020

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Pushback on use of plastics is a major challenge for flexible packaging. Going forward, suppliers look to find eco-friendly alternatives, while educating consumers on the many benefits of this growing packaging segment.

To gain an industry-wide perspective on the year that has just ended and the prospects for 2020, Flexible Packaging reached out to executives whose businesses represent the spectrum of flexible packaging.
In their own words, leaders from ProAmpac, Charter NEX, Totani America, Avery Dennison and the Flexible Packaging Association deliver their points of view for our annual Executive Forecast.

Sustainability is once again a leading concern across the board. Companies are looking to find material recourses that will protect the environment and quell rising worries from the public. Executives interviewed for this article point to the need to educate consumers that plastic packaging is not all bad. Indeed, many of its benefits are often overlooked.
After years of steady growth in the U.S., some also expressed concern about the direction the economy will take in 2020, especially in light of recent trade war actions that remain unresolved. Here is what these executives have to say:

Q: As we enter a new decade, what do you see as the prospects for your company and the packaging market in general in 2020?
A: Sustainable packaging will be a much bigger focus for the North American marketplace moving forward. Sustainability is already very much a part of our global economy, and one of the strategies to meet your sustainable objectives is to reduce usage.  In our world, that means reducing the packaging material content. ProAmpac has numerous examples to date of moving our customers from a rigid plastic, glass or metal format to a flexible packaging format that is 100 percent recyclable. As the U.S. supply moves to become more sustainable, ProAmpac will be a leader in helping our industry to realize its potential.

Q: What are some of the biggest challenges this industry currently faces? How do you think those challenges will change throughout 2020?
A: The trade war has created a disconnect between supply and demand for raw materials.  The trade war dynamics have hit the flexible packaging industry hard over the last two years. The policy shifts on import costs have forced many in our industry to implement price increases, identify higher-priced alternative supply or, in some cases, absorb the cost increases.  The pace of policy implementation has been a disruptor to say the very least. Unfortunately, there are many flexible packaging companies struggling financially to deal with the fallout. Moving into 2020, trade policy appears to be shifting to also include Latin America, which will again disrupt supply costs of various raw materials our industry requires to meet the needs of our customers. ProAmpac will continue to manage through these changes, remaining transparent to our customers on changes as they materialize.

Q: What new product features are brand owners and co-packers seeking in materials and machinery for flexible packaging, and what trends are driving these demands?
A: This past year, we’ve seen all our markets request more sustainable flexible packaging options. Also, we are engaging more and more with brands on moving from rigid solutions to flexible packaging. Coupled with better product delivery systems like spouts and closures, a flexible package is not only more sustainable but also easier for consumers to use.
In addition, shelf differentiation remains a priority with brand owners. We have a lot of shaped formats, innovative graphic techniques and differentiating coatings available to help products standout on the shelf while adding consumer appeal and functionality.

Q: These days, the use of plastics — a major component in flexible packaging — seems to be under attack. How should the industry address this issue?
A: Education. As an industry, I think we need to continue to educate our markets about realities of packaging. The Flexible Packaging Association has many great resources available to assist in the conversation about packaging and sustainability. 

The word “plastic” now has negative connotation the same as the word “paper” 10 years ago.  However, ProAmpac approaches our markets with a substrate agnostic view, meaning we can use paper, polymers, combinations of and/or any sustainable material necessary to meet form, fit and function required. We want to make sure our customers are getting the performance requirements they need for their product, whatever the material.

Q: Please comment on how 2019 went for your company and what you feel its major achievements were during the last year.
A: In 2019, we celebrated our fourth year of coming together as ProAmpac and delivered another year of organic growth. ProAmpac continues to evolve as a private, family-oriented company that fosters a culture of caring for our teammates and communities. We are proud to have kept in place our small company mindset while offering our customers large-scale capabilities that we continue to build.

We have also had a great year of recognition by various industry organizations for our design and innovation expertise. I am very proud of how far we have come in such a short time all while maintaining our values of integrity, intensity, innovation and involvement. I also need to share how excited we are with the impact of our internal ProAmpac Employee Assistance Fund (PEAF), which is a 501(c )(3) established in 2017. PEAF is funded by our employees to help other ProAmpac employees in times of need. We helped 54 individuals and families this past year, which has made a big difference in many lives.

Q: As we enter a new decade, what do you see as the prospects for your company and the packaging market in general in 2020?
A: Certainly, the sustainability of plastics and flexible packaging will be the most apparent theme to take center stage heading into the next decade, underscored with a much greater sense of urgency as we head closer to 2025 when many brands have made commitments to make all of their packaging either 100 percent recyclable or reusable. Similarly, our company has elevated its commitment to sustainability by instituting several sustainable manufacturing initiatives, increasing the usage of PCR, and taking a larger role in industry related advocacy efforts.