Global Retail E Commerce Packaging Market Is Expected To Grow At A Cagr Of 5.92% During The Forecast Period.

Published On : January 2018

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Overview:


Packaging is the process of enclosing the product for sale, storage or distribution. Latest development in the e-commerce market is cross-border online shopping. It has revolutionized the shopping experience due to its attractive offers and desired product availability. E-commerce is generally the buying and selling of goods & services online. All the distributions, transactions occurs either as business-to-business, business-to-consumer, consumer-to-consumer or consumer-to-business. The benefits of e-commerce are wide availability of goods & services, speed of access, and global reach.


Many organizations especially in Asia Pacific region have witnessed expanding share. Asia Pacific being one of the fastest growing markets, companies are grabbing opportunity and are keen on expanding their units in this region. Moreover, there are other small and medium scale players that are able to generate revenue from the local markets. International Paper Company, Nippon Paper Industries Co. Ltd., Smurfit Kappa Group, Mondi Group, DS Smith Plc., Packaging Corporation of America, Rengo Co. Ltd, Orora Packaging Australia Pty Ltd., Klabin S.A., and Georgia-Pacific LLC has been recognized as the global leaders with serving the broad range of e-comemrce products.


Increase in online shopping market:


The continuous increase in the online shopping market is fuelling the overall growth of the retail e-commerce packaging market. The ease of online shopping such as faster delivery, easier return policies, and free shipping, have made many customers switch from the traditional method of shopping. The strong consumer demand for the high variety of products and the availability of different kinds of goods, together drive the growth of online shopping market. Companies such as Amazon have ventured into the Asia Pacific markets and have faced immense competition from the local e-commerce players. China on the other hand has become one of the leading players in the industry and has witnessed expanding market. This has offered flourishing market to the packaging industry in the region.

Future Trends in Retail E-commerce Packaging


Protective packaging products are designed to protect the goods from different types of damages such as atmospheric, magnetic, electrostatic, vibration or shock. Protective packaging includes different types of boxes or storage container, liners and spacers. There is an increase in demand for protective packaging because they are widely used in online shopping industry. The growth of protective packaging is also because of the growth in the e-commerce industry. The growing trend of internet shopping, all over the world signifies the need for protective packaging, which prevents damages while transportation or storing the products.


In developing countries such as China, India, Indonesia, Thailand, Vietnam, and Mexico is having largest disposable income, due to which there is a significant growth in the manufacturing and service industry. The higher disposable income in these developing countries results in the increase in purchasing power. As a result retail e-commerce packaging market has been impacted positively.

Expansion – Growth strategy


Extensive research in this market has brought to light that mergers & acquisitions is the key strategy adopted by the major players in the global retail e-commerce packaging market. This strategy is widely adopted to increase the market share and their client base. For example, the Mondi group acquired companies such as Kalenobel to strengthen their market in Russia by improving the customer offerings. These acquisitions will support the ongoing development of corrugated packaging business in Central & Eastern Europe which will lead to the expansion of their business, globally, so as to serve customer in a much better way.


In addition to this, expansion is another strategy adopted extensively by the players to spread their geographical presence and achieve operational efficiencies. For instance, Klabin S.A. (Brazil) had opened a new pulp plant to expand its business and became the first fibre solution company in Brazil.


Based on expansions, Rengo Co. Ltd (Japan) has undergone significant number of expansions during the period 2014-2016. For instance, in April 2016, Rengo Co. Ltd (Japan) announces that its overseas affiliated company, Prepack Thailand Co., Ltd. (Prepack) has opened a new flexible packaging factory in Sinsakhon (Thailand) to leverage its extensive flexible packaging expertise in Southeast Asia region.

During the period 2014-2016, amongst all the key developments, Klabin S.A. (Brazil) accounted for a large in the partnership and collaborations. For instance, Klabin S.A. (Brazil) signed a partnership agreement in May 2015 with the country's main research entity, the National Council for Scientific and Technological Development (CNPq). The objective of this partnership is to develop new techniques for reusing solid waste from industrial activities.


Product development is also seen as a widely adopted strategy by the companies during the period 2014 to 2016. For instance, in August 2016, DS Smith Plc. (U.K.) has developed robust and eye-catching tray packaging in order to increase its sales and to attract the young generation. The materials that go into the tray were developed using extra strong 2 mm and 3 mm corrugated board in order to ensure that the trays and products are not damaged during transportation or in-store handling. This was done primarily to coincide with the launch of its new series of wine gums and liquorice sweets under the Nørregade brand.