A Decade in Review:
The State and Future of the Packaging Industry
By: Brian Gertin
Happy new year, dear reader! With the early days of the new ‘Roaring 20s’ upon us, it’s important that we take the time to reflect on how far we, and the industry have come in the last decade.
The 2010s saw explosive growth and major advancements for the packaging, warehousing, and fulfillment industries. And with the introduction and further integration of innovative new technologies to the market in the coming years, the 2020s are shaping up to be even more exciting than the previous decade.
So without further ado, let’s look at what’s changed for our industry in the last decade, so we can anticipate some of the trends that are to come in the next.
The Era of eCommerce
Although the 2000s saw the initial inception and early success of companies like Amazon, the 2010s saw eCommerce become an everyday part of our lives. Between 2010 and 2019, eCommerce sales experienced a massive 600% growth, increasing from $572 billion in global sales in 2010 to just under $3.5 trillion in 2019.
The convenience, and widespread use of eCommerce platforms has drastically changed the way products make their way into the hands of the consumer. Today, more products than ever are going directly from warehouses to homes without ever passing through actual brick and mortar stores.
This has led to major changes in the way products are packaged and shipped, with more emphasis being placed on the presentation of packaging. Many companies are struggling to find cost effective, visually appealing ways to ship products to their customers. For more information on how the unboxing experience has evolved with ecommerce, and to learn some easy tips on how to improve your own operation, check out our recent blog.
Internet of Things (IoT)
Connectivity has become an expectation over the last decade. By mid-decade (2015) roughly 15.4 billion devices worldwide were connected to the internet. This year there will be roughly 30.7 billion connected devices worldwide, and by 2025 this is projected to grow to 75.4 billion – roughly 9 connected devices for every person in the world.
Customer’s expectations when it comes to real-time location monitoring of their package(s), or to real-time monitoring of stock levels is already at an all-time high, and it’s likely that this kind of service will become even more important in the 2020s.
With more and more demand for connectivity, IoT is sure to change the landscape of packaging and fulfillment in the coming decade. Everything from more responsive customer service thanks to autonomous connected devices, to optimized workflows on the warehouse floor thanks to real-time location, condition and quality monitoring, IoT is certain to have a major impact on our industry.
With the growth of eCommerce, customers are demanding faster turnaround times and cheaper shipping methods. This has put a lot of strain on companies to find ways to make their processes more efficient. As such, warehousing and fulfillment practices have seen a lot of improvement by way of automation over the last decade.
In 2012, Amazon acquired the robotics company Kiva Systems to help them with warehouse automation. These robots automate a lot of the product movement throughout the warehouse, eliminating the need for humans to perform these tasks and freeing up their time for things like packaging the products that need to go out. The choice to automate product transportation within the warehouse has increased the overall efficiency of the warehouse to fulfill customer orders.
Internet of Things
The good news for packaging and fulfillment is that it isn’t going away any time soon. The strength and continued growth of eCommerce means that more packages are going out, and technology advancements will only serve to make shipping processes more efficient and transparent. The Internet of Things will play a part in this transparency through things like RFID tracking tags.
Already many warehouses - including many of our customers' thanks to our Vendor Managed Inventory (VMI) system - are equipped with RFID tracking technology to monitor stock levels. But what if this same technology could be applied to products throughout the shipping journey? Customers and companies could get real-time updates of the package’s location, instead of just receiving notifications when it reaches a checkpoint. Not only would this help customers anticipate the arrival of their package, but it could provide valuable data for companies about potential bottlenecks in their processes.
Another trend that we’re already seeing is in the push for more sustainable packaging materials. Manufacturers, distributors, and designers are all working on ways to reduce the impact their products have on the environment.
While paper packaging provides a sustainable alternative for some products, this isn’t a solution for all products. An emerging technology, bioplastics, seeks to address this problem by making transparent and translucent faux-plastic packaging made from plant biomass.
In 2015, Coca-Cola launched its PlantBottle™ , which, in addition to offering their own customers a sustainable alternative to their plastic bottles, also encouraged other brands and manufacturers to pursue sustainable alternatives for their standard plastic containers. Today, a number of other global brands, including Nestlé, Procter & Gamble, and Unilever are all members of the Bioplastic Feedstock Alliance. With major companies like these committing to sustainable packaging alternatives, it’s safe to say we can expect significant growth in the implementation of things like plant-based plastics in the years to come.
Our Eyes to the Future
Technology has helped the packaging and fulfillment industries to reach new heights in the past decade, aided greatly by the attention that eCommerce has placed on how things are done.
At Gertex, we’re excited to be a part of this evolving and expanding industry. We offer some of the most cutting-edge packaging solutions and packaging technology to our customers.
Contact us today for a free assessment, and to find out how we can work together to grow your business in the coming year, and decade!
Secretary Treasurer and Co-Founder