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Flexible Manufacturing Is Showing Steady Growth Because of Flexible Packaging

Flexible Manufacturing Is Showing Steady Growth Because of Flexible Packaging

The packaging industry is experiencing a steady increase in custom manufacturing of mass produced goods, according to a study released this week at PackExpo in Las Vegas. PMMI, the Association for Packaging and Processing Technologies, released a study at the opening of the tradeshow showing that flexible manufacturing continues to grow at a steady pace. The shift to flexible containers is prompted in large part by brand managers seeking to offer custom packaging to major retailers such as Wal-Mart and Walgreens.

The study shows that 68 percent of end-user companies interviewed expect to purchase new equipment, modify existing equipment, or buy used equipment to accommodate flexible packaging. Thirty-three percent of end users expect to increase their use of flexible packaging - versus rigid manufacturing systems - over the next five years. Forty percent of the companies are currently using flexible packaging for upwards of 90 percent of their products.

While the growth in any given year is not staggering, the growth has consistently been in the 4 percent range, and this year it went up a notch. "A lot of end users are already involved in flexible packaging, and we're seen a 5 percent growth this year," Donna Ritson, owner of DDR Communications, a firm that helped with the research, told Design News. "About one third of brands are moving toward it, and 50 percent of brands are now using it in food and beverage."

Brands Are Ready to Spend on Flexibility

Shifting from rigid manufacturing to a flexible model is expensive, but with competitive pressure to keep major retailers happy, brands are beginning to spend. "Cost is a huge consideration in moving from rigid to flexible manufacturing," said Ritson. "Yet one in three companies is increasing capital spending, and two out of three are making changes."

Food products use the most flexible packaging, leading all vertical industries with 57 percent use of flexible packaging, followed by the pharmaceutical industry at 31 percent. The beverage industry uses 25 percent flexible packaging, while 2 percent of household products are currently in flexible packaging. "Brand managers are looking for innovation, and the food service companies are moving the most aggressively," said Ritson. "They're looking for brand differentiation as shelf space gets more crowded."

The shift to flexible packaging continues to be driven by major retailers. It began with Wal-Mart asking for custom sizes. Wal-Mart calculated the exact dollar amount their customers would spend on an individual product. The retailer calculated the exact size the product needed to be to satisfy that calculation and gave it's suppliers the marching orders to produce the exact size. From there it spread to other retailers. "It's driven by end users, and manufacturers are accomplishing it by modifying the end of the manufacturing line," Jim Hulman a business development manager at Bosch Rexroth, told Design News.

Rob Spiegel has covered automation and control for 15 years, 12 of them for Design News. Other topics he has covered include supply chain technology, alternative energy, and cyber security. For 10 years he was owner and publisher of the food magazine Chile Pepper.

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