Reusable and refillable packaging is one of the most dynamic sectors of the packaging market in 2022, with rapid growth fueled by innovative formats and the need to enact more planet-friendly business models, says a new targeted market study from Smithers – The Future of Refillable and Reusable Packaging to 2027.
By fundamentally rethinking packaging, physical retailers and brands can make a highly visible commitment to cutting single-use plastics, while for e-commerce subscription businesses it provides a major opportunity to differentiate themselves from competitors. This study projects that the market will reach $42 billion in 2022, up from $35.1 billion in 2017. As the industry looks to new concepts to realize true circularity in packaging, Smithers forecasts future growth at 5% year-on-year reaching a value of $53.5 billion in 2027.
Smithers’ analysis identifies four distinct business models:
Reuse and refill is a familiar business model in beverage retailing, especially for glass bottles. For this reason even in 2022, glass packaging for beverages remains the dominant segment, representing over 75% of all reuse refill packs.
Other segments are still at a nascent phase. Brand owners in food, cosmetics & personal care, home care, and other beverage types are investing heavily in reuse/refill concepts featuring more durable packaging design for repeat use and prolonged handling. Strengthened by the experience of Covid-19 and the rise in e-commerce subscription sales, Smithers forecasts each of these new segments will see growth in excess of 30% year-on-year across the next five years.
There are several technologies that will improve the effectiveness of reuse packaging models:
Another UK study recently showed that while recycling, reuse and composting of packaging will all increase significantly, a fifth of all food packaging could still find its way to landfill and incineration even in two decades time. Today, food packaging is predominantly plastic and recycling rates are relatively low. While fiber-based packaging is widely recycled in non-food uses, the industry believes that by 2040 fiber-based packaging will approach circularity as technical development broadens, according to a study commissioned by UPM Specialty Papers, a sustainable packaging products manufacturer.