In today’s retail landscape, sustainability isn’t just a buzzword; it’s a mandate for survival. With consumers and regulators alike pushing for greener practices, the pressure is on for retailers to rethink their approach to packaging. McKinsey surveyed consumers across 11 countries to understand their attitudes toward sustainable packaging and it was revealed that hygiene and shelf life remain as the top factors influencing consumers’ purchasing decisions– but why is that?
Shift from COVID to Now
During the pandemic, hygiene concerns paused efforts to eliminate single-use packaging but now that we’re traversing a post-pandemic world, consumers are less concerned about hygiene and food safety, though these aspects remain important, while price and quality continue to be critical decision criteria for consumers. Sustainability pressure is building again as we move beyond the pandemic with an aggressive sustainability goal.
Sustainability Goal by 2030
It may be far from the present but retailers are becoming ambitious with their sustainability targets for 2030. To start off, there is an aim to achieve an increase of the share of recycled content in packaging by 50 percent. In addition, they aim to reduce their virgin-plastic footprint by 50 percent to move toward using 100 percent reusable, recyclable, or compostable materials in their private label range (where they have the most control over outputs). It is an intentional goal but not without challenges in the way.
Overcoming Challenges
The demand for post consumer recycled plastic packaging is expected to triple by 2030 due to sustainability goals and regulatory targets set by retailers. However, the supply of such materials is only projected to double while consumers continue to prioritise brands that use sustainable packaging.
Achieving these targets won’t be a walk in the park. McKinsey’s analysis reveals a looming gap between demand and supply of post-consumer recycled plastic packaging by 2030, signalling potential price hikes and supply chain disruptions. Moreover, the misconception that sustainable packaging comes at a premium poses another hurdle for retailers. To navigate these challenges and seize the opportunities presented by sustainable packaging, retailers must adopt a multifaceted approach. McKinsey outlines five key actions to guide retailers on this journey.
McKinsey’s 5 Steps to Achieve Sustainability for Retailers
Evaluate Packaging Sustainability
First off, it is important for retailers to thoroughly examine and audit the types of materials used in their existing packaging. This includes understanding the composition of packaging materials (e.g., plastics, paper, glass) and their environmental impact. As retailer, these should be your key considerations:
- Recyclability: Are the materials easily recyclable? Can they be efficiently processed in existing recycling systems?
- Renewability: Are renewable resources (such as plant-based materials) being utilised?
- Life Cycle Analysis: Assess the entire life cycle of materials, from production to disposal.
- Weight Reduction: Can packaging be lightweighted without compromising functionality or safety?
Forge Partnerships with Experts in Sustainable Packaging
Sustainability should be woven into the fabric of packaging design, with a focus on minimising unsustainable materials and embracing eco-friendly alternatives. Myerton Packaging is a packaging company based in Australia and as a local one-stop shop for all things sustainable packaging, has a wide-array of sustainable papers available to create custom and eco-friendly packaging that suits every retailer’s needs.
Investing In ’‘Circular Economy’ Leaders with The Right Infrastructure
The key to any successful business starts with a skilled team of experts working together for the same goal on top of an efficient infrastructure in place. As a retailer, here’s what you need to remember:
Training and Skill Development for Staff
- Invest in Talent: Develop a skilled workforce by providing training programs on sustainable packaging. Educate employees about recycling technologies, life cycle assessments, and best practices.
- Awareness and Expertise: Foster awareness about circular economy principles and encourage employees to stay updated on industry trends and innovations. For instance, in Western Australia, you can subscribe to WA eNews to stay updated on grants, programs and initiatives available for businesses.
Enhance Infrastructure Today
- Reverse Logistics Optimization: Streamline reverse logistics processes to efficiently manage packaging returns, recycling, and reuse. Establish clear guidelines for handling returned materials.
- Material Recovery Facilities (MRFs): Collaborate with MRFs to ensure effective sorting and processing of recyclable materials. Invest in MRF infrastructure to enhance recycling capabilities.
Stay Updated on New Regulations
With regulatory landscapes evolving globally, retailers must stay vigilant and proactive. In Australia, the plastic ban is an on-going initiative being imposed state per state. Learn how you can shift your current packaging roster to government-mandated replacements and pivot accordingly.
Wrapping It Up
As we progress towards the goal of achieving net-zero emissions by 2050, the role of sustainable packaging in reducing environmental impact cannot be overstated. It is an inevitable trend with the government backing it up with actionable steps. It is important for businesses to pivot and understand the right sustainable packaging that not only adheres to regulations but meets your customer’s growing demand of safety and aesthetics.
