All eyes are set on 2021 for a progressive business year. Let’s accept it. Nothing’s going to change overnight. The Covid situation will largely undermine our performance as a country and with a vaccine in the offing, hopefully, normalcy will return soon. But this year pips to be a page-turner in history for several industries and packaging is positively one of them. Flexi-packaging offers a unique opportunity to India to emerge as a significant global player, if it successfully optimises technology, skills, and efficiency. The packaging sector has experienced mixed effects of the pandemic depending on the portfolios of different end-user industries. With increased trends of globalisation and consumption, India has seen an upward swing in the packaging industry even during the pre-covid times which has moved from strength to strength and eyeing a sizable growth with the emergence of new trade models such as e-commerce and organised retailing. Here are the following trends in 2021 that should excite you if you’re in the flexible-packaging business.
1. Alteration in Consumer Behaviour – Hygiene and sanitation has become a primary concern for consumers irrespective of age group and income bracket. ‘Fear’ will play a major role in motivating consumers to choose packaged Food Vs Loose food now onwards. This will result in the growth of packaged foods which need minimum handling and reduce the risk of adulteration resulting in the direct growth of the flexi-packaging industry.
2. Consolidation - Indian packaging industry has become an attractive investment avenue for global players and large giants, especially the flexible packaging segment, which is flourishing like never before. What was earlier a largely unorganised set-up, the flexi-packaging industry has managed to garner the attention of large players resulting in consolidation and big-ticket mergers and acquisitions. There will be continued investment in terms of skill, technology and manpower in this sector for 2021 and the years to follow.
3. E-commerce – In India e-commerce is at a nascent stage with projected growth of CAGR 27% and projected outlay of $200 billion by 2026. It received a magnificent boost due to closure of traditional brick and mortar stores during the lockdown. With the pandemic holding long-term effects e-commerce and e-retailing has a long way ahead not only in our country but the world over. Transit packaging and omni-channel packaging are looking like the most potential segments that guarantee hygiene, safety, hygiene, and integrity of goods. This will greatly contribute to the increasing might of the Indian packaging industry.
4. Growth of Peripheral industries – With China dominating the raw material supply for flexi-packaging industry the pandemic has hit the earlier smooth supply chain and given flexi-manufacturing companies of India a reason to scout for local options to source regular resources for constant production and scope for innovation. The global supply chain vulnerabilities also present an exciting opportunity for Indian businesses to develop the necessary raw materials and know-how to become dependable vendor partners in the international arena.
5. Agility for Efficiency – Most businesses will focus on rebuilding lost revenue streams during 2021 and bring stability back into the system. Flexi-packaging manufacturers who have had a good year in 2020 would require re-setting supply networks and logistic plans to increase the scope and scale of operations. With testing times it will be necessary for all players to work the tight rope of agility to achieve efficiency. With innovation in the production process and supply network, packaging players need to show resilience to thrive in the uncertain year.
Any industry that serves the FMCG sector in a constant state of evolution and the flexi-packaging domain is no different. With most manufacturers looking at the slow and steady module to find a firm footing in 2021 we at Montage Group are, on the contrary, looking at zip-zap-zoom growth. Being responsive and adaptive to the market and our consumers we are sure to make the most of a promising 2021.