The trend of Next-Generation Packaging refers to the evolving changes in materials used for primary, secondary, and tertiary packaging as well as the technology added to this packaging. These materials and new technology enable packaging to sense and react to environmental changes and to changes in the packaged contents. This trend also incorporates elements of sustainability, incorporating new packaging materials that are more bio-based, recyclable, reusable, and biodegradable.
From the continued boom and rise of e-commerce to the global drive for sustainability, the need is growing for creative and cost-efficient packaging solutions with a heavy focus on the reduction of CO2 footprints. In order to meet customer demand, there is keen focus on recyclability, reusability, compostability, and biodegradability and a rising demand for antimicrobial packaging, package traceability, and condition-monitored packaging. It is increasingly important for logistics providers to meet these needs. Propelled by population growth, technological developments, and changing consumer expectations about product packaging, the global packaging market has seen rapid growth in recent years. With a current market size of 27.4 billion USD, the global next-generation packaging market is forecast at a 10-year CAGR of 6.1% to reach a market size of 49.3 billion USD by 2032.
This growth is mainly driven by consumer awareness around topics of sustainability and the development of new technologies to ensure product-handling safety and care in the end-to-end supply chain right up to final delivery. Recent advances in packaging technology include the incorporation of radio-frequency identification (RFID) tags, sensors, and indicators in packaging materials, as well as redefining the way packaging materials are sourced.
With developments in this trend set to continue in the next 5 years, more and more companies are reconsidering the materials used in their packaging. In May 2022, the global packaging company Amcor launched its latest technology bottles that are up to 30% lighter and made of 100% recycled materials. As more companies change the ways they use materials and sustainable goods, logistics players also need to make adjustments, implementing next-generation packaging practices and reevaluating current operations to ensure new types of packaging can be processed safely through conveyor belts, scanners, and more and the contents of this packaging can be delivered without damage to recipients.
Several big industry players are expanding packaging solution portfolios through partnerships, acquisitions, and mergers. For example, MeadWestvaco merged with Rock-Tenn to become WestRock, currently the second largest American packaging company. Another example is the collaboration between manufacturers Stora Enso and NXP Semiconductors to develop intelligent packaging with integrated RFID technology, a solution designed to enhance consumer engagement and improve supply chain efficiency.
Next-generation packaging solutions can enable consumers and manufacturers to track shipment locations, receive notification of a package being opened, and monitor package condition throughout the journey.
Relevance to the Future of Logistics
- Active Packaging for Fresh & Cold Chain
- Intelligent Packaging for Asset Monitoring
- Modified Atmosphere Packaging
Active packaging incorporates additives to maintain or extend product quality and shelf life. Active packaging solutions today account for an over 36% share of the global next-generation packaging market and are predicted to remain dominant for the next 10 years. Examples of active packaging include antimicrobial packaging, heating/cooling packaging, items including gas emitters, absorbers and scavengers, moisture/odor/flavor absorbing and releasing packaging, corrosion control packaging, and spoilage retardant items.
These types of packaging are engineered to respond and react to changes in the external and internal atmosphere of a package and are therefore of utmost importance and significance to the pharmaceutical and nutraceutical industries. Logistics providers in turn, need to have fresh chain and cold chain operational capabilities in place to ensure product delivery meets the standards set by customers and, aligns with varying fresh and cold chain legislation.
Intelligent packaging systems monitor the internal condition of packaged goods to give information on quality during transportation and storage. Simply defined as packaging which senses and informs, these systems integrate hardware components such as time temperature indicators (TTI), freshness and ripening sensors, and RFID and other tags. This helps maintain the quality of products, contributing to a reduction in global waste. The healthcare and pharmaceutical industries are considered major growth markets, highlighted by the Covid-19 pandemic, as there is a growing need to improve supply chain visibility in these sectors.
Application opportunities for intelligent packaging are not limited to just these industries, however. Within logistics and supply chain operations, smart packaging solutions are vital to goods in many other industries, better protecting them with real-time tracking as this cuts the risk of theft, last-mile delivery diversion, counterfeiting, and other crimes.
An example of this is the BOX developed by the start-up company LivingPackets – a smart packaging solution equipped with sensors to monitor temperature, humidity, and shock during transportation. As the BOX incorporates a digital screen, there is no need for labels to be printed. The screen uses e-ink technology and therefore does not consume energy which, combined with the reusability of the box itself, makes this a sustainable smart packaging solution that contributes to circularity.
The vast expansion of global shipping and transportation capacity has enabled rapid transportation around the world of perishable goods and atmosphere-sensitive products. Within this complex process to ensure products arrive in best condition, the internal atmosphere of the storage container or packaging must be continuously maintained and may need to be changed. As such, the use of modified atmosphere packaging (MAP) becomes central to the effectiveness of transportation and delivery.
The benefits of MAP technology include reducing global food wastage, extending shelf life by days and even weeks, and achieving a more profitable and secure global food supply chain. For nutraceuticals, goods that tend to deteriorate through oxidation can be protected by actively replacing oxygen with nitrogen.
The Covid-19 pandemic highlighted the need for MAP solutions to facilitate global vaccine shipments, particularly controlling and modifying atmospheric temperature during transportation. One example of this is the development of packaging that incorporates internal dry ice.
From increasing visibility, improving security, and enhancing supply chain reliability, next-generation packaging shows great potential for further growth in increasing the efficiency and dependability of logistics and the supply chain. Outdated packaging systems will be replaced by smart packaging solutions as e-commerce continues to reshape the retail industry and as consumers and regulators demand greater sustainability and a smaller environmental footprint in logistics.
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- Future Market Insights (2022): Next generation packaging market outlook (2022-2032)
- Amcor (2022): Amcor PowerPost™ is next-generation technology that delivers a more sustainable bottle and better consumer experience
- Supply Chain Quarterly (2019): Smart packaging: challenges and opportunities in the supply chain
- AZO Materials (2021): Modified atmosphere gas mixers from environics