Produce packaging makers battle rising costs
While packaging costs continue to rise, innovation is tamping them down, at least somewhat, produce marketers and packaging manufacturers say.
Adding pre-packaging and bigger box sizes will increase the cost of the product, acknowledged Nicole Lipson, segment marketing manager; and John Huston, business unit sales manager with Atlanta-based packaging manufacturer WestRock.
There is an upside, though, they noted.
Larger boxes “also drive more opportunities to ‘cube-out’ units and trucks for transportation,” they said.
Costs are not necessarily going up across the board, said Karen Reed, marketing and communications director with Union Gap, Wash.-based closure manufacturer Kwik Lok Corp.
“In some cases, not at all; in others, where there is very new technology being introduced and there is added value, there may be some increase,” she said.
Market prices for produce also play a role in the caprices of costs, cautioned Brianna Shales, senior marketing manager with Wenatchee, Wash.-based fruit grower-shipper Stemilt Growers LLC.
“We are in a rising apple market with shorter supplies compared to last year, and so that is going to be the biggest differential compared to last year,” she said, citing one example.
“Efficiency has increased on the packing side when it comes to bags.”
Consumers inevitably will see the effects of higher packaging costs, said Dave DeMots, CEO of Canby, Ore.-based Package Containers Inc.
“We see a rise in raw material costs coming almost across the board,” he said. “This will find its way to the final cost of packaging soon.”
Costs have trended slightly higher, due to issues with raw materials for packaging, said Jeff Watkin, graphic and marketing manager with Collinsville, Ill.-based package maker Sev-Rend Corp.
“Sev-Rend’s purchasing team has done an excellent job managing and anticipating this,” he said. “Our goal is to support our clients so there are no gaps in the market with fresh produce due to packaging lead time delays.”
Cost control and maintaining a steady supply of packaging are a major emphases, Watkin said.
“This has been the number one focus for Sev-Rend, as the COVID crisis started and we put a lot of time and energy into maintaining so there are no delays,” he said.
Produce shippers and packaging suppliers can collaborate along those lines, said Liz Walsh, director of customer and consumer insights with Atlanta-based Georgia-Pacific.
“Companies facing cost pressures can work with their supplier on options to reduce cost including new designs, SKU consolidation or shelf/display-ready packaging,” she said.
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