In his recent chairman’s review to members of the Packaging and Films Association (PAFA), in London, David Read said the packaging industry is “well positioned to endure the current recession because of the cost-effectiveness of plastics films, thermo-formed trays and flexible packaging”.
In spite of the unprecedented rise and fall in oil prices together with dramatic increases in the costs of resin, film, ink, energy and “every item needed to conduct business”, the lightweight, compactness of flexible films offers outstanding advantages.
His year as chairman of PAFA started with a “startling rise in the price of oil which triggered run-ups in prices of virtually every commodity yet, during the latter stages of the year, the bubble burst. Oil prices tumbled, as did many other commodities.”
But he went on to say: “I think the belief that packaging is “recession-proof” is too simplistic, although our industry is faring much better than many”.
He said the current recession holds many challenges and opportunities for PAFA members. “Already in the UK we are experiencing retailers holding inventories to a minimum or ‘de-stocking’ to conserve cash. This has trickled down to our members’ order books in the form of more frequent, smaller orders in many cases. We also expect a renewed emphasis on retailers’ ‘own brands’ which generally offer lower cost to the consumer and better margin for the retailers.”
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