Demand for paper packaging continues to grow as companies seek to replace single use plastic with paper. Major corporations such as Amazon, Chick-Fil-A, and Walmart are transitioning to paper packaging – Amazon alone has replaced 95% of its plastic air pillows with paper filler – and worldwide demand for paper packaging has increased by 65% (Reuters). Globally, the paper packaging industry is projected to grow from $428 billion in 2023 to $535 billion by 2032 (imarc).
Environmental concerns, business advantages, and total impacted cost are driving the move from plastic to paper packaging. Understanding the need for change, from social responsibility to long-term ROI, is crucial to justifying initial investments and ensuring a successful transition.
This series outlines how to convert from plastic to paper packaging, beginning with the benefits of switching.
1. Paper Packaging is Eco-Friendly
While plastic offers benefits in certain industries and applications, many companies are driven to make the switch from plastic to paper where they can due to the harmful impacts of plastic on the environment.
- Plastic represents 80% of all marine pollution (UNESCO)
- 8 to 11 million tons of plastic waste enter the ocean annually (MIT)
- Only 9% of all plastic ever produced has been recycled (MIT)
- Plastic can contain hazardous chemicals (National Library of Medicine), and recent headlines have warned about microplastics being found in the human body (National Library of Medicine)
Paper is naturally more eco-friendly and doesn’t present health issues for humans or wildlife. Paper packaging is made from renewable, sustainably sourced materials, bringing benefits such as:
- Biodegradability
- Compostability
- Recyclability
Paper can come with a high percentage of recycled content, can be re-pulped, and is recycled more frequently than plastic – in part because it is difficult for consumers to know if plastic is recyclable or which container to place it in. Paper is much more recyclable, which is largely why over 80% of paper packaging gets recycled (EPA). It also doesn’t rely on chemical reactions and is less sensitive to contamination (Forbes).
Ultimately, paper packaging is the more sustainable choice, helping companies reduce pollution and achieve their social responsibility goals.
2. Paper Packaging Benefits Businesses
Paper packaging provides business benefits over plastics in four key areas.
Consumer preference and market trends
Consumers want more sustainable packaging, as evidenced by a Blue Yonder Consumer Sustainability Survey featured on Two Sides North America. The survey found that many consumers prioritize sustainability over price and convenience. For example:
- 78% say sustainability is “very” or “somewhat” important when deciding what to buy and where to shop
- 85% of Gen Z and 84% of Millennial respondents say sustainability is important, and Gen Z and Millennial consumers will pay a premium for sustainable products
- Nearly half (47%) of all respondents increased their sustainable shopping in the previous 12 months
- 40% of respondents would pay 5% more for products with sustainable packaging; 25% would pay 10% more
- 61% of respondents say recycled content or packaging is the most important environmental practice for retailers
- 56% of consumers prefer online orders to be delivered in paper packaging
A separate Two Sides North America survey revealed that 55% of consumers would buy more from companies that remove plastic from their packaging, and 47% would avoid retailers that do not use recyclable packaging materials.
Clearly, switching to paper packaging helps companies cater to consumer preference and market trends.
Compliance
Companies also face regulatory pressure to switch to paper. Geographical bans on single use plastics and phthalates can open or close markets depending on which type of packaging you use.
For example:
- The European Union already bans many single use plastic products (European Commission) and recently passed legislation to ban many types of single use plastic packaging by 2030 (World Economic Forum)
- Collectively, the EU’s 27 member states and 450 million people make it the largest single market in the world (Statista)
- Paper packaging passes stringent testing and enables companies to sell in that market, while plastic packaging may prevent companies from selling in the EU
Domestically, California’s Plastic Pollution Prevention and Packaging Producer Responsibility Act mandates that all single-use packaging must be recyclable or compostable by 2032 (California Governor Newsom). In addition, 12 U.S. states ban single use plastic bags (World Economic Forum), and New York’s state legislature recently banned single use plastic toiletry bottles in hotels (Bloomberg Law).
It stands to reason that regulations will continue to tighten for plastic packaging, so switching to paper can help companies maintain compliance – and gain a competitive advantage – worldwide.
Distribution
Big box stores and other major retailers – both online and off – have their own sustainability initiatives. Products with sustainable packaging are more likely to be carried by retailers, while products with non-sustainable packaging face competitive disadvantages.
Companies that can help major retailers meet their eco-friendly agendas are more attractive and therefore more likely to get distribution for their products.
Versatility
Paper offers more versatile and creative design options than plastic packaging, which often requires labels to differentiate products. When you choose paper, you have more opportunities to create custom packages that are more attractive, unique, and stand out online and on the shelf.
3. Paper Packaging Can Be Cost Efficient
Some sources cite plastics as the cheapest packaging option. However, it’s important to evaluate total cost of impact, not just the unit cost, and that includes:
- Recycling infrastructure costs
- The cost of manufacturing processes required to make plastic film versus paperboard
- Customer acquisition, retention, and churn
We’ve demonstrated that customers are prioritizing sustainability when making purchasing decisions. Companies that use plastic packaging are at risk of losing customers to competitors who choose paper packaging. That alone can prove far costlier than a relatively minor difference in unit price.
Of course, there’s a lot to consider when converting from plastic to paper packaging. A strategic approach ensures a smooth and successful transition. Read Part 2 of this series for tips on planning your switch to paper packaging.
