What lies ahead for print & packaging in 2023?
Every New Year brings with it a sense of both the familiar and the new. Change is constant and inevitable, and the print & packaging sector is always evolving with new technologies, trends and compliance requirements. But old themes often persist too, and, as we step into 2023, we are leaving behind another challenging year, which has seen the cause of cost management issues shift from the supply chain difficulties we experienced during the pandemic, to the rocketing price of energy due to the war in Ukraine.
The good news is that supply chain issues seem to be improving, with much better availability enabling greater choice and allowing more accurate scheduling. This has taken the huge risk factor of potential delays out of the packaging print delivery cycle, and has meant that prices for materials have stabilised. While the cost of materials has not returned to pre-pandemic levels, reduced price volatility makes it easier to plan and manage costs, both for Herbert Walkers and for our customers. The additional operational costs of energy and transport remain significant factors in the cost management challenge, but the Energy Bill Relief Scheme for businesses is helping in the short term. In addition, here at Herbert Walkers, we have invested in an energy management programme that is helping us identify opportunities to save energy – reducing both our bills and our carbon footprint.
2023 trends in packaging demand and design
Looking ahead to 2023, it will be interesting to see how retail has faired over the peak Christmas sales period. The fortunes of brands and retailers over this critical sales period not only affect their planning for the following festive season, but also influence buying patterns throughout the year too. There is an expectation that sales will rise year-on-year, but we are in a period of multiple anomalies: our last two Christmas seasons have been affected by COVID and the increased spending that came about with more leisure time and a greater need for celebration, so comparison with these periods is not like for like. Meanwhile, the cost of living crisis is likely to have an impact on consumer spending this Christmas and set the tone for the year ahead.
What does that mean for packaging and print? It seems likely that we will see demand fall a little as brands, retailers, and their customers tighten their respective belts. But the impact of the cost of living crisis on packaging design and print requirements is a difficult trend to call.
On the one hand, brands and retailers are likely to look for ways to reduce their packaging costs by implementing design and print strategies that are more efficient and involve lower material use. At Herbert Walkers, with our turnkey approach to all production and finishes, we are well-placed to advise customers on those strategies and help them implement them.
On the other hand, however, packaging matters more than ever in a competitive market because the product needs to stand out on shelf. Consequently, it will be designs and finishes that deliver the highest impact for the greatest value that will be central to delivering packaging strategies that balance the need to rein in costs with creating consumer appeal.
Where next for sustainability?
We can also expect to see the sustainability trend continue to play out in 2023. In many respects, the need to reduce energy consumption and material use for cost management reasons chimes well with the sustainability agenda, because these goals also have a positive effect on carbon reduction. As we continue to see a move away from plastic – as seen in the transition from plastic detergent capsule boxes to board during 2022, for example – there is a huge opportunity for board-based packaging innovation.
At Herbert Walkers, throughout our 75-year history we have remained successful by spotting opportunities to leverage our strengths in order to evolve what we do, aligned with market trends. As a family business with no re-financing commitments, Herbert Walkers is well placed to remain agile and optimise the potential of new trends and opportunities. We have benefitted from high demand for packaging print during the pandemic and we re-invested those gains in the business, installing new equipment and hiring additional members of staff to enhance our capabilities and our capacity. That means we are well-placed to remain ahead of the market, innovate and respond to customers’ needs.
Away from our packaging print business, Herbert Walkers has also geared up to handle additional demand for greetings card printing. The greetings card industry is under pressure to re-shore production from China for a number of reasons, including supply chain resilience, sustainability and socio-political lobbies. Herbert Walkers has capacity to handle some of this additional demand in an ISO 9001 and ISO 14001 certified UK production facility for greetings card publishers that want to re-shore.
What will recession mean for print?
It seems fairly certain that the UK economy will fall into recession in 2023, with recession also expected to hit the Euro zone this year. As an independent business that has invested wisely during years of growth and spread our customer base across packaging and greetings cards, Herbert Walkers is well placed to continue to thrive during a recession. The packaging and greetings cards markets may contract a little, but they are both areas where consumer purchasing remains necessary, so the supply chain will remain busy. The challenge will be to deliver value while keeping both quality and cost management to the fore as the printing sector supports brands and retailers in their quest to help consumers navigate the cost of living crisis.