Packaging companies are contending with rising input costs and tighter regulations to meet customer expectations for secure, convenient, yet attractive packaging.
by Mitalee Kurdekar
If one were to resort to clichés to describe the development of the packaging industry, none could be more apt than the oft used ‘necessity is the mother of invention’. The changing trends in packaging, particularly consumer goods packaging, are a result of ever-evolving end-consumer requirements, and hence do complete justice to the old adage.
With much of the Indian population now living in smaller households and on smaller household budgets, consumption patterns have also changed, giving rise to demand for smaller pack sizes. Then, there are lifestyle issues that have made health awareness the single biggest driver for improved packaging. Similarly, an ‘on the go’ lifestyle in modern times, with extended work hours and long commuting times results in consumers looking for convenience packs, and hence the demand for single units or small packs has only kept growing. This demand is further enhanced by the availability of convenience stores and hypermarkets in every nook and corner of major cities and towns.
In addition to above, the packaging industry has witnessed a great deal of development in high-performance packaging materials. While many of these have been developed to meet fast-improving regulations surrounding safety & security standards, quite a few of these have happened to provide better quality products to delight end-consumers. As a result, materials with strong barrier characteristics, intelligent packaging, and digital prints to provide information on the pack’s contents are now more common. They also promote efficiencies in the supply chain network and benefit the ultimate consumers. Further, environmental concerns around the disposal of packaging wastes have made packaging companies conscious about using the right kind of material for easy & safe disposal, or at least resorting to recycling of used packs.
Indian Context
The Indian packaging industry is an important sector of the economy as it supports other vital sectors within manufacturing, including the fast-moving consumer goods (FMCG) industry. Currently growing at around 15% per annum, the industry is estimated to be the fourth largest in terms of revenues. In terms of growth rate, it is second only to China. Ever increasing demand for FMCG and consumer goods, a fast-developing retail sector and emergence of new technologies & innovation in packaging solutions have contributed to this growth. According to N C Saha, director, Indian Institute of Packaging (IIP), India’s per capita consumption of packaging is only 4.3kgs per person per annum as compared to 20kgs in China and 43kgs in Germany.
There is, therefore, a great deal of scope to convert unpacked commodities into well-presented, packaged ones. This, of course, requires a certain degree of innovation, entrepreneurship and logistical advancements, all put together. The IIP has allied with the Ministry of Commerce and taken the responsibility to develop packaging standards for 500 exportable products in line with global standards. India has also signed a mandate to comply with the UN certification for packaging of goods that go into international markets, and therefore has an obligation to do so. This clearly indicates that the Indian packaging industry has the potential to become a global player in the coming years.
Unveiling Trends in Packaging
The Indian packaging industry moves fast enough to quickly embrace new technologies and new materials in packaging that are trending globally. This is because of its quick adaptability and capability for cost effective implementation that is backed by growing volumes for Indian packagers. Dr Rakesh Sinha, head, global supply chain, manufacturing and information technology, Godrej Consumer Products Limited (GCPL), elaborates, “Some of the interesting trends we see are in the areas of transparent packaging, eco-friendly bio-degradable packaging, recyclable plastics and bio-based plastics. We also see increasing adoption of micro-embossing of cartons and use of counterfeiting technology at the moulding stage itself.”
Providing another example, Dr Sudhakar Mhaskar, chief technology officer, Marico, states, “The technology which is at the forefront today is 3D printing, which is mainly a design intervention, reducing the lead time by manifesting an idea to physical samples in a few hours. Additionally, this technology has been used to develop low cost moulds to generate actual touch & feel samples with the right material. Digital printing has also taken up a high stage in the field of decoration for shrink sleeve, labels, carton printing, etc., where premiumisation and lower volumes are the need of the hour. Reliability on technology is mainly to reduce cost with respect to high cavitation and high speed moulding, and better product quality for consumers.”
Satyendra Patel, MD, Pyloff Packaging, highlights a trend that allows product usage over a longer period, stating, “The recent trend is towards portion packs with MAP (modified atmosphere packaging) or CAP (controlled atmosphere packaging) for longer shelf life of products. Re-closable packs such as Ziploc are also popular due to the utilisation of such packs for consumption of the product over a longer period of time, and better storage in the meanwhile.”
Safely Encased
Not only is there innovation in the types of packaging, but the material used to make them, too. Dr Mhaskar suggests that new age polymers improve the flow properties and additives, which reduces the scratches on the PET bottles when travelling through the un-scrambler and bottling machines. He points out that, “At Marico, interplaying with polymers viz. HDPE to PP helps in bringing down the weight and hence the cost. Also, moving into PET moulding helps in reducing the weight further and curbing the cycle time, which in turn leads to reduction in cost when made through ISBM machines.” Regarding counterfeit measures, he adds, “We have incorporated anti-counterfeit features in the Livon packs, however, we are looking at more overt features which will help in incorporating the anti-counterfeit features across packs.”
Dr Sinha paints a similar picture of GCPL when he proclaims, “New raw materials entering the field are mostly in the eco-friendly area. These include bio-based plastics, recyclable plastics and other bio-degradable materials. Many of these technologies are getting more and more cost effective as the technologies mature. The packaging materials that we currently use do not have anti-counterfeit features. But in many cases, we have designed our products to be pilfer proof/pilfer evident.”
In any packaging, the role of a good adhesive is vital. Henkel adhesives are prominently used in these applications. They support the parameters of safety, quality and productivity in making the product most user-friendly.
Expounding this, S Sunil Kumar, business director, packaging & consumer goods, Henkel Adhesives Technologies India, says, “To achieve perfect results for the paper converting industry, machines, applicators, substrates and adhesives have to be fully compatible with each other. We support this process by polymerising our own basic raw materials, thus enabling us to tailor products to tight specifications. Through communication and cooperation with machine manufacturers, OEMs and substrate manufactures, we have developed technologically sophisticated and market focused adhesives systems. Henkel offers a comprehensive range of adhesives for that.”
A Matter of Choice
While most Indian packaging companies choose to rely on both domestic and overseas suppliers for their needs of raw materials, the choice of imported material is important for more regulated markets where quality standards are exacting and therefore important to adhere to. But with Indian vendors improving their manufacturing standards and bringing out compliant product ranges, it has become easier for Indian packagers to rely increasingly on domestic vendors for obvious benefits of supply chain management, given the erratic nature of demand and frequently changing product lines on the shop floor.
Dr Mhaskar explains this, by stating, “It’s more commercially viable to have a packaging solution which is from domestic suppliers. There are international suppliers who have seen potential in the growing Indian economy, and we are looking at tapping opportunity for new innovations with them. In the last five years, the quality of the packaging material from domestic suppliers has peaked as their material is also being used for our exports, which are more stringent with respect to quality, hence also helping the domestic FMCG business in terms of quality.”
Dr Sinha agrees. “We don’t really differentiate vendors by their country of origin. We look for solutions which best suit our needs and are eco-friendly. Of late, we have seen Indian vendors getting more competitive on technology, innovation and cost fronts as compared to their international competitors. Local vendors also help us in being more agile to changes in consumer demand, due to their proximity,” he concludes.
All these are sure signs that the packaging industry in India is coming of age, thus benefitting not just themselves, but the FMCG space at large. Opting for the best in technology and material is helping ensure that this success streak continues. And that can only be a good thing for vendors and users of packaging solutions, as well as end-consumers.