Packaging market seeing increase in demand, especially for complete solutions

Business Forum
The packaging market experienced a revival process in the first quarter of the year, following an upward slope, especially against the background of the orientation of companies towards complete packaging solutions - protective packaging and packaging systems. Underlying the revival is the roughly 20% increase in demand in the cardboard and paper packaging segment compared to the first quarter of 2023, according to INATECH Packaging's internal data.

However, a moderation in general consumption is observed this year, Romanians tend to purchase fewer products, reflecting the changes in consumer behavior influenced by the current economic context, shows data from INATECH Packaging, one of the main suppliers of complete packaging solutions in Romania.

This growth is mainly fueled by increased interest from retailers, especially  ecommerce. Thus, between January and March 2024, companies ordered over 300,000 kg of paper and cardboard packaging, according to INATECH Packaging's internal data.

In this context, as the main trend in 2024 on the packaging market remains the interest of companies to reduce product packaging costs, preferring to enter into partnerships with suppliers with complete packaging solutions and that offer packaging resistant to handling and transporting products, especially for holidays, when there is peak demand.

"Although the beginning of the year indicates some uncertainty in the economy, the packaging market maintains its development trend, but with demand adjustments: there is an increasingly obvious interest in complete packaging solutions. Thus, companies in Romania are increasingly oriented towards suppliers who can offer solutions from A to Z, from the most diverse types of packaging to packaging systems, which challenges us to rethink our product, sales and investment strategy to meet the needs of the market and to ensure constant growth in the business. Moreover, the packaging market is going through a slightly atypical period: although we are experiencing growth in our activity due to the diversification of the product range and the development of the customer portfolio, the overall consumption is more moderate compared to other years. In contrast, demand for protective packaging was at its highest around Easter and continues to grow overall, fueled by a number of factors, including the rise of e-commerce and the growing focus on protecting products during transport and storage. This has led to a constant demand for sustainable and efficient packaging solutions that provide adequate protection but are also environmentally friendly," says Cristian Bădescu, CEO of INATECH Packaging.

Companies want complete packaging solutions, practically they are more and more interested in one-stop shop type suppliers, where they can find all types of packaging and including packaging systems necessary for the activity and the products sold. Also, INATECH Packaging representatives notice an increasing orientation towards the automation of packaging processes, especially in the manufacturing industry and in logistics, where efficiency and saving time and resources are a priority. This change is fueled by constant technological advancement and the need to reduce costs and improve operational processes.

Higher demand for customized packaging and for temperature-controlled packaging

In the first quarter of the year, most requests for protective packaging and packaging systems come from the industries: e-commerce, production, retail, pharma, automotive, logistics, but also sub-niches that appear strictly during various international or religious holidays. Thus, the most sought-after types of packaging are those made of paper, cardboard, bubble wrap, heat-insulating packaging, for large food products, but also for drinks, luxury products and gifts. Of the total packaging requests, more than 30% are represented by ecological packaging, which is increasingly used by companies in Romania.

In the context of the preparation of product stocks for Easter, more orders were registered for the same types of packaging as in the rest of the year. At the same time, a 7% increase was recorded for customized packaging made of technical foams, being one of the periods of the year with a higher sales volume in this packaging segment. Thus, IFOAM AG, one of the companies and business lines of the INATECH group, records growth from year to year.

"I also noticed an increasing attention paid to the aesthetic aspect of packaging, especially in the consumer goods and luxury products sector. Thus, the demand for customized and high-quality packaging solutions is increasing as companies seek to differentiate themselves in the market and provide a memorable experience to their customers. Demand for custom packaging comes from a variety of industries, including e-commerce, automotive, electronics. Companies are looking to custom packaging to differentiate themselves in the market, create memorable customer experiences and promote their brands and products in a unique and distinctive way. Personalized packaging contributes to strengthening customer loyalty, stimulating sales and promoting the brand image", explains Andrei Rusu, co-founder of IFOAM AG, part of the INATECH group.

The changing packaging market. Companies, increasingly focused on cost reduction

At the same time, against the background of more moderate consumption in general, INATECH Packaging is planning new investments in the expansion of the product portfolio and the development of the "complete packaging provider" concept, in order to fulfill the specific demand in the market.

Thus, INATECH Packaging offers a complete range of packaging machines and equipment, including: automatic vertical PP and PET strapping machine, package packaging machines, robots and automatic palletizing machines, warehouse equipment, packaging systems, tables professional packaging and other packaging products available for testing at the Pack Show between May 14 and 17 at Romexpo. During the event, the company will be the largest exhibitor, presenting on an area of ​​200 square meters the most requested and innovative types of packaging, such as: e-commerce packaging, personalized packaging, ecological packaging, but also heat-insulating packaging in temperature conditions controlled.

"In order to optimize their costs and increase profitability, companies invest in packaging systems, where we have a constant high demand, which leads us to come up with product proposals suitable to customer needs. Operational efficiency is becoming increasingly important to companies, leading to an increase in demand for packaging systems that optimize production and distribution processes. Using automated packaging equipment and customized solutions can reduce costs and improve workflows. There are also significant changes in the business environment and consumer preferences, which also comes with a readjustment of the types of packaging required. In the digital age, the expansion of e-commerce has fueled a rapid increase in the need for customized packaging for online deliveries. Companies are looking for packaging solutions that ensure product protection during transport, offer a pleasant unboxing experience and contribute to customer loyalty", points out Mădălina Geamănu, Marketing Manager at INATECH Packaging.

Founded in 2010, the INATECH group, which includes INATECH Packaging (packaging division), iFOAM AG (customized packaging division) and Isoteckline (professional construction insulation division), is one of the largest protective packaging companies in Romania and Eastern Europe, with a complete packaging range and constantly diversified with new types of packaging, currently counting more than 5,000 unique codes in the product portfolio.

The company has both a protective packaging and insulating materials division as well as a custom packaging production line, through which it serves numerous industries including: automotive, e-commerce, logistics, pharmaceutical, electronics, aeronautics, construction, furniture manufacturing and others. With a warehouse in Domnești-Ilfov and Oradea-CTP Cargo Terminal, INATECH Packaging serves the markets of: Romania, Bulgaria, Hungary, the Republic of Moldova, Germany and Austria, the export segment representing 10% of the business.

In 2023, INATECH entered the segment of recycling and processing plastic waste for the production of recycled granular raw material, necessary for product protection, as part of the sustainability strategy of the whole group.

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Business Forum  |  22 November, 2024 at 3:54 PM