Is sustainable packaging threatened by inflation? | Article

Consumers and businesses are in the midst of a storm of economic challenges with soaring energy costs, rising business production costs, weakening consumer spending and soaring inflation that wreaks havoc.

This economic backdrop raises key questions for sustainable practices in the food and packaging industry and for the broader consumer mindset. Will more environmentally friendly products and packaging (often available at a higher financial cost than less sustainable traditional materials and processes) continue to be a top priority for consumers? Can sustainable products and packaging features only really flourish in a context of economic dynamism, high consumer spending and high disposable incomes?

The food retail industry has made so many fantastic strides in recent years when it comes to sustainable packaging, including huge investments in recycling infrastructure, monumental reductions in the use of plastics, the introduction of various rechargeable product lines, commitments to ambitious carbon reduction targets, etc.

At the same time, consumer mindsets have become increasingly accustomed to food produced and presented in a more sustainable way. Thus, sustainable food packaging has become less of a novelty and more of a permanent consumer expectation. From all angles, the market will be very reluctant to backtrack on such advancements just as a cost-cutting measure.

Supermarkets will also be keenly aware of the public relations risks associated with downgrading the sustainability of their product lines. In such a competitive retail environment, retailers will want to show that the sustainability of their enhanced packaging and broader environmental credentials are genuine. Firmly sticking to these commitments in the current economic climate will help dispel any previous cynical accusations of greenwashing from industry commentators.

Additionally, while retailers have undoubtedly made huge strides in packaging sustainability, the existing extensive product lines continue to offer more sustainable products alongside cheaper alternatives. As such, affordable original items remain available without necessarily needing to roll back sustainable advances elsewhere in other product lines. Likewise, while large swaths of the economy are under severe financial pressure, others will continue with high proportions of disposable income and expect to continue buying the more sustainably packaged items they rely on. are used to.

It should also be noted that the cost differentials between sustainable packaging and cheaper alternatives (plastics produced at lower cost, for example) may not be as visible as they once were. As environmentally focused legislation, such as the plastic tax, continues to come into effect, non-sustainable packaging materials will become less and less attractive to retailers and packaging buyers.

The overriding challenge facing food retailers is a balancing act. Businesses must ensure that fresh food and produce remains affordable for a population that is going through incredibly difficult times when it comes to their personal finances. However, they must also continue to embrace sustainable advances in packaging as well as broader business operations and processes.

This is a challenge that unites the grocery industry and should be met rather than avoided. As is often the case, innovation will undoubtedly be the means by which retailers can combine these two essential attributes. Whether it’s the latest technologies extending the shelf life of sustainably packaged food, packaging manufacturing innovations that drive efficiency savings in logistics and transportation processes, or streamlined packaging designs that can reduce costs and material usage, the industry will have many areas in which to meet these diverse consumer needs.

Retailers who are able to simultaneously increase consumer value while improving sustainability could be well positioned to build long-term customer loyalty down the road.

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