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There were reasons to be cheerful at this year’s Packaging Innovations and Empack show. The halls were buzzing with visitors and exhibitors were plentiful; a sure sign that this edition of the event at Birmingham’s NEC is growing.
But scratch under the surface and you’ll discover that this is a nervous industry: worried about the impact of Extended Producer Responsibility (EPR); concerned that the rise in National Insurance will slow growth; anxious (like us all) about the ever-uncertain global outlook. Packaging is a resilient sector and one that crackles with energy and innovation – yet it’s not immune from outside noise.
That Defra was out in force at the show indicates it was keen to soothe nerves about EPR. The government department had good reason to be there. EPR is fast becoming a reality and, at the start of the year, Defra unveiled its new scheme administrator – Pack UK. The admin department will be busy applying the new rules to ensure that businesses placing packaging onto the market pay for it (the ‘polluter pays’ principle’) and hope that the scheme steers firms to recyclable materials thanks to modulated fees. In addition, the plan is that the money raised is invested into waste management infrastructure.
Defra’s minister for nature, Mary Creagh, addressed visitors and urged industry to “pitch in with your ideas, intelligence and experience”. Creagh added that the government wants to make sure “Britain is open for business”. It’s a line that might raise a few eyebrows.
There’s still tension around EPR, with a nagging feeling that it adds cost to businesses at a time when economic growth is a struggle. It’s not something that will radically change as, despite the scheme’s difficult birth, it’s too late for a U-turn. Data collection is underway and there’s a sense that for all the niggling issues, EPR is an upgrade on the current PRN system.
Fees related to individual materials were fiercely debated at Packaging Innovations. The glass sector fears it will incur higher fees due to its weight. Meanwhile, the plastic sector is concerned that it will be hit hard by becoming the most expensive material under the scheme’s base fees. Unease at how the charges will be applied is to be expected as each material fights its corner. Defra, and Pack UK, will hope that the industry will adapt to the new normal.
EPR aside, there are other anxieties. Speaking to businesses at the show, there are real fears that labour costs are a growing challenge. The rise in the minimum wage wasn’t a surprise but the employer hike in national insurance caught a few off guard. In a sector reliant on casual workers, anything viewed as an obstacle to hiring will impact business. It’s why some businesses are viewing options such as outsourcing and automation with increased interest. While it might represent changes to process or a big initial investment, new routes to market and technology could future proof businesses from the impacts of changes in employment law.
So it’s all doom and gloom, right? That’s not an entirely fair summary; 450 exhibitors and nearly 7,500 unique visitors talking face-to face, points to a confident market. And innovation is alive to the challenges (and opportunities) ahead. Take the Packaging Startup Awards for example. The entries tackled a wide variety of areas such as new materials, reuse, waste reduction, online retail and connected packaging. Fresh thinking is shaping the future.
And what of AI technology? It’s not all about taking jobs out of the industry (although it’s worth conceding that there will be some casualties) but about giving designers and technologists the insight required to create packs that hit the spot first time. It’s a form of automation that could free up time to focus on creativity and deliver something that resonates with consumers.
It was also good to hear more about inclusive design and how connected packaging can make a positive impact on blind and partially sighted people. The debate around sustainability is in danger of drowning out developments in how packaging can make a genuine difference to people’s lives. Again, technology holds the key; in this case the smart phone.
Taking the temperature of the packaging industry is difficult. Yes, there are those unhappy at the trajectory of the sector and the direction government is heading. But there’s also opportunity and innovation out there; creatives striving to find marginal gains in a competitive field.
A packaging technologist once told me that he loved new rules and hated the idea of creating something from a blank sheet of paper; legislation gave a designer the framework and the fun was finding the loopholes. While it might be a stretch to label the game-changing set of packaging reforms ‘fun’, there will be plenty to occupy the minds of the industry’s innovators.