Packaging Segments and the likely winners

Packaging development, starting from brand story to artwork to integrated view of tertiary, secondary and primary packaging can help start-ups create a unique unboxing experience for their customers.

This integrated approach can also help them optimize packages to help them save on logistics costs. Amongst a plethora of options available to consumers, packaging can act as a key differentiator to aid greater consumer recall and help the product stand out.  

While primary packaging is much more organized and integrated today with global best practices, it is the secondary and tertiary (transit) packaging that needs more attention and focus.

We believe that due to undisputed shift towards sustainability; folding cartons, corrugated cartons and rigid packaging (based on sustainable materials) will continue to dominate secondary packaging while corrugated boxes will occupy an even bigger piece of the pie in transit packaging (up from ~60% today). (~95% of Corrugated boxes are recycled in the world).

Nearly 55% of manufacturers in India are focused on corrugation box who account for nearly 30% of packaging Industry output.

In India, to say that corrugated box industry is fragmented is a massive understatement. India has ~12,500+ players compared to ~1,300 players in US and Canada. ~97% of these players are MSME Manufacturers with revenue less than Rs70 Crores who have a regional presence.

Most of these MSME players have manual or semi-automated manufacturing lines. Due to its strength, versatility, and sustainability it will continue to occupy a monopolistic role in tertiary packaging while occupying a much larger share in secondary packaging.

Corrugation and Folding Cartons contribute nearly half of Indian Packaging Industry output. Technology overlap in corrugation and folding cartons is immense. Applications are also complementary due to role of folding cartons in primary/secondary packaging and that of corrugated cartons in tertiary packaging. Hence SME Manufacturers often have product offerings in both the segments. Folding cartons have applications in premium packaging and contribute in a meaningful way to exports. Building upon these capabilities can open up new markets for SME Manufacturers in India.

Regards

Endurance Solutions Team