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  November 2nd, 2022 | Written by

Global Shift toward Sustainable Packaging Materials to Shape the Future of Retail-Ready Packaging Market

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Burgeoning consumption of packaged food products and expansion of the global retail sector is expected to drive the retail ready packaging (RRP) market growth. The industry may record an estimated 4.8% CAGR between 2022 to 2028, claims Global Market Insights Inc.

Rapid digitalization and easy accessibility to a wide range of food products have led to colossal growth in the global grocery e-commerce sector. Despite this, many consumers still prefer shopping from retail stores given its numerous benefits, like no shipping cost and instant product ownership – factors that are expected to offer considerable impetus to the retail ready packaging market.  

According to the U.S. Department of Commerce 2021 report, U.S. retail sales for 2021 were $6.6 trillion, representing 17.9% growth from 2020. The report further highlights that 2021 was one of the strongest years in the retail history of the U.S., representing a 2X times growth from the previous three decades.

To benefit from an expanding business space, companies in the retail sector are looking at innovative and creative ways to increase the sales of displayed products while improving store management. To that end, retail ready packaging (or shelf ready packaging) has proven to be a highly beneficial solution. Designed to make it easier for retailers to sell their products, this packaging reduces product handling requirements and makes it simpler and faster to stock retail shelves or store floors.

Two Key Driving Factors Transforming Retail Ready Packaging Industry Outlook:

A couple of major benefits of retail ready packaging that are contributing to its increasing demand have been enlisted below:

  • Minimized labor cost: 

Retail-ready packaging is used at scale by giants like Walmart and Costco as these players look to simplify product displays while accelerating sales without adding to the labor cost. Issues like inconsistencies in package sizes and price points are often said to be the main contributors toward increasing workload for store employees and higher labor costs to retailers.

With an aim to help customers lower their business expenses, retail ready packaging companies are coming up with new and innovative solutions. Recently, Tosca, a reusable packaging solutions provider, developed a retail-ready packaging solution for eggs that could drastically cut labor costs. Its Reusable Plastic Containers (RPCs) with a SmartWall™ feature allows sales associates to place entire containers directly on the shelf. 

  • Improved customer experience:

Shelf ready packaging can help customers enjoy a more cohesive shopping experience by offering information that helps them make informed decisions with their purchase. Studies show that by offering a better customer experience, businesses can acquire repeat customers that could generate around 40% of a brand’s revenue. Attractive designs and aesthetic graphics on retail ready packaging play a key role to entice consumers to make a product purchase. 

Ecofriendly packaging to drive the future of RRP industry

Retailers and packaging firms worldwide are trying to reduce the use of plastic packaging materials to lower their environmental impact and are shifting towards sustainable products and materials like paper and paperboard.

Awareness regarding the ill effects of plastic use on the environment, with consumers willing to pay extra for eco-friendly products, has reinforced the need for RRP manufacturers to shift to recyclable packaging solutions. A survey by Accenture states that consumers are ready to pay more for sustainable products that are designed using reused or recycled material.

Paperboard packaging market, as per estimates, is projected to foresee sizable revenue growth on the back of the ongoing trends associated with the sustainable packaging sector, rising consumption of packaged food and robust demand from the packaged food business.

Made from wood pulp, paperboard is a paper-based thick material used in packaging applications and is recycled in large amounts to reduce waste and deforestation. The material is mainly used in medical packaging, food & beverages, durable and non-durable goods, industrial packaging, and cosmetics.

Preference for case ready meat products

Case ready or retail ready meat products are resonating well with consumers as well as retailers worldwide. Meat products that come pre-packaged help retailers to cut down on labor and waste as well as increase assortment and sales. With retail ready packaging of meat products, store employees can also save time on stocking shelves and can reallocate their time to customer service. 

Another key advantage of case ready meats is their increased shelf life due to vacuum-sealed packaging which translates to improved freshness and quality of meat products. In fact, according to a report by The Food Industry Association, case ready meats offer better quality than meat packaged in the store.

As consumers are preferring home-cooked meals and storing larger quantities of grocery products, the demand for retail ready meat could escalate in the coming years. In consequence, meat and poultry companies are making large-scale investments in the production of case ready meat products. 

In 2021, Tyson Foods announced the expansion of its case-ready meat production by reopening its plant in Columbia. The company would also be investing $55 million over the next five years to convert the plant to produce retail ready packages of sliced fresh pork and beef for grocery stores in the eastern U.S.

What Does the Future Hold for RRP Market?

Changing consumer preference toward packaged food products and rising sales across the retail sector are expected to play a key role in advancing the growth graph of retail ready packaging market in the forthcoming years. Rising consumption of case ready meat and awareness regarding eco-friendly packaging materials will also trigger the production of sustainable and advanced RRP materials and solutions in the future.