Startups Eye Sustainable Packaging
Globally there is a shift towards sustainable packaging and this has resulted in a slew of startups taking the field
The global packaging market, valued around $1.5 to $1.8 trillion, is fast emerging as a happy hunting ground for innovation. This has resulted in a slew of startups mushrooming across the world that seek to engage this industry with digital products aimed to enhance efficiencies in what has always been a traditional business.
A recent research report published by Research & Markets notes that the biodegradable tableware and packaged products market size in India would touch $3.23 billion by 2030, growing at a CAGR of 6% from here on. The growing interest in the switchover to biodegradable options is what companies are hoping to cash in on now.
Further, the nationwide ban on the production, import, stocking, distribution, sale, and usage of specific single-use plastic items has spurred major demand for biodegradable tableware and packaging products in India.
A global trend is visible now
However, it’s not just India that is witnessing a shift in this direction. A recent report published by TechCrunch noted that Packmatic, a German digital packaging marketplace recently raised 15 million Euros in a Series-A round.
The company plans to use the funds to further push its services into the European markets, being one of the many that’s attacking the packaging industry. The early birds such as Packhelp from Poland have been at it since 2015 and raised $58 million till 2021. The company has a SaaS product for enterprise clients providing eco-friendly packaging.
The pandemic caused the shift
In fact, in the post-pandemic timeframe, several of these companies saw an upswing due to the increased demand for food delivery services and the concomitant increase in packaging requirements. Though the pandemic has since disappeared, the trend set during those tough times appears to be continuing without any change.
Another startup based out of England called Sourceful raised $19 million in Series A funding to grow its platform business that allows enterprises to find products within a marketplace of vetted suppliers across the UK and Asia. The company also offers an ISO-certified carbon footprint estimation process that analyzes product choices of its clients.
Bringing order into traditional business
Most of these startups are attempting to tackle similar challenges related to price transparency and the purchase processes followed by the packaging industry. The challenges of providing solutions on demand and in a customized fashion is still a far cry for this industry steeped in tradition where even suppliers find it tough to navigate the demand-supply challenge.
Which is why companies like Packmatic make sense as they bring packaging suppliers across a geography and match them to large companies as well as big brands. The company claims cost savings of up to 15% through this approach whereby the demand for sustainable packaging is easily met and that too in a timely manner.
From an India perspective, packaged products are set to grow at the fastest CAGR from 2024 to 2030 with biodegradable packaging growing in demand in the food and beverage and food service industries. In addition, paper tableware and packaging products are also growing at a high CAGR, given their role in catering services, outdoor events and such.
