Welcome To
The Bottom Line

Caused by the unprecedented and ongoing economic situation from the COVID-19 pandemic, price inflation is being closely monitored by leading experts. Many industries are already seeing pressure on transport, raw materials, and increased demand. Among these areas is packaging — specifically, packaging that is manufactured from corrugated cardboard. 

To maintain a competitive advantage in the ever-changing manufacturing world, optimizing your supply chain — especially in the areas of manufacturing and packaging — can provide efficiencies and cost savings.

It shouldn’t come as a surprise that the growth of e-commerce has had a significant impact on packaging sectors, including flexible packaging, which had a compound annual growth rate (CAGR) of 5.7% between 2020 and 2021. This growth occurred in a single year, seeing a dip of 16.5% in U.S. manufacturing. 

With roots stemming back to the 1950s, the flexible packaging market is a significant product in the procurement industry due to its efficiency, customizability, and sustainability. 

Flexible packaging is a type of package or container made of flexible material, which, when filled, can still easily change shape. Though there are many examples of flexible packaging, a few examples include:

• Paper
• Cartons
• Blister packaging 
• Flexible laminates
• Woven bags 

Interesting times are ahead for companies that purchase significant pulp and paper volumes, a group that includes virtually any manufacturer with packaging needs. According to the US Bureau of Labor Statistics Producer Price Index, from February 2020 to February 2021, pulp and paper prices increased more than 5%. Data published by the St. Louis Federal Reserve Bank shows that corrugated prices increased approximately 11.5% between September 2020 and March 2021. These price increases will soon show up in packaging costs...if they aren’t already.

In any aspect of business, achieving a sense of efficiency—balancing effort, time, and money to achieve the best outcome—is hard work. This is a particularly unique challenge for packaging and transportation. From excess headspace to improperly scheduled routes, to simply being unaware of emerging shipping and packaging solutions, it’s easy for a business to unknowingly lose thousands of dollars and valuable resource hours per year.

Remember the days when ecommerce was just starting out and online shopping was viewed as the green option? Rather than idling on gridlocked roads belching exhaust fumes en route to the mall, consumers could complete a few mouse clicks from the comfort of their desk chairs and merchandise would magically appear at their doorstep.

Those promises of convenience have largely played out; the environmental benefits are a murkier picture, however. Look no further than curbside on recycling day for evidence of this new shopping model. Increasingly, instead of 30 widgets packed in one box going to retailers, 30 separate boxes are going directly to consumers – even when consumers place orders for multiple items. Does the carbon footprint of added cardboard and bubble wrap outweigh the reduced auto emissions? The answer isn’t as tidy as initially thought.