Supply Chain Stability: The art of an ever-shifting balance between resiliency and efficiency
St. Petersburg, FL (December 23, 2024) – Joe Adamski, Senior Director at ProcureAbility, was featured in a recent article from Supply & Demand Chain Executive. The article focused on how, amid economic and geopolitical volatility, the packaging industry is adapting through innovation to balance cost, sustainability, and supply chain resilience.
Read the full article in Supply & Demand Chain Executive and below:
The US finds itself at another turning point amid escalating geopolitical risks, election cycle uncertainty, and shifts in monetary policy. These factors continue to impact the broader economy. Ongoing tension between resiliency and efficiency in supply chains remains a challenge. Geopolitical and domestic events are further intensifying this pressure, driving higher costs for manufacturers. The packaging industry supports a wide cross section of materials and services providers, with overall packaging demand following macroeconomic trends. As manufacturers rebalance production offshore and onshore, packaging demand, logistics needs, and required services will shift across US regions.
When combined with packaging trends like waste elimination, environmental improvements, and direct-to-consumer optimization, change is constant. What we do today will continue to evolve for tomorrow.
Finding an artful balance during volatile market conditions
Corporations and stakeholders like certainty and stability—and value productivity and efficiency. While inflation has retreated from a 50-year high, it remains a problem as consumers have seen their buying power drastically eroded. Manufacturers have responded by downsizing packages or finding other cost savings means, often by changing or restricting packaging. The removal of Chevron deference will have a major impact on environmental policy, the most significant since the EPA’s creation. This will, in turn, significantly affect packaging manufacturers.
Looming threats of trade wars or price controls are driving expectations of consumer disruption. This remains true regardless of which party wins the election.
Not surprisingly, these conditions have impacted the packaging industry significantly, as this is a sector that is sensitive to rapidly changing demand, increasing costs, and logistics issues. Areas of top concern include:
- The rising cost of raw materials, such as paper, cardboard, and plastics, which has directly increased the cost of packaging production
- The surge in energy prices, which has led to higher energy costs for packaging producers
- Increased transportation costs due to higher fuel prices and supply chain disruptions, which have added to the overall cost of packaging
- Environmental impact concerns of materials that become waste
While these challenges are expected to continue through 2025 and beyond, the packaging industry has a strong history of adapting. It continues to innovate in response to constant change. One example is the rise of fit-for-purpose packaging solutions. Traditional fillers like plastics and Styrofoam are being replaced by biodegradable or organic alternatives. These solutions mimic the same properties without the same environmental impact. Microplastics are another driver of innovation due to growing concerns about environmental and health risks. Packaging materials that contribute to this issue will be flagged and may face future regulation.
Identifying the best means to the end
Manufacturers continue to develop means to lower their overall energy usage and costs. Solar power can leverage the significant roof space available in many plants. Utilizing power purchase agreements from green energy providers has proven an effective alternative to traditional distributed electricity. Reducing energy demand, through more efficient processes, production machinery, and optimization has been effectively leveraged to only use what energy is required. In the future, wearables will enable even greater optimization as automation can better control energy usage based on physical location and needs of the workforce.
At its core, consumer packaging should be viewed as a means of delivering the product rather than an end in itself. We must explore alternative ways to get products into consumers’ hands that minimize packaging costs, material waste, and environmental impact. Traditional approaches, such as lightweighting or optimizing package size, have limits and are not sufficient alone. Solutions that prioritize efficient delivery and waste reduction will prevail. While primary and secondary packaging remain crucial for attracting consumers, these materials must be optimized to reduce environmental impact while maintaining appeal. This must be balanced with consumer protection requirements, and innovation should continue to ensure quality, freshness, and microbe prevention. Additionally, incorporating blockchain tools into packaging—such as RFID for high-value items or QR codes—can enhance traceability and provide real-time supply chain insights.
Being part of the solution
Producers and manufacturers that fail to lean into these changes will be at risk of being left behind. Research shows that consumers are increasingly prioritizing eco-friendly options when they click to purchase. However, this doesn’t mean they will ignore price all together but try to strike a balance between sustainability and affordability. While the consumer will continue to expect environmental considerations, we do see a continued push for governmental mandates, especially as technology continues to advance.
As laws and regulations push and pull the industry, we see brands increasingly relying on their suppliers to deliver solutions to these demands through packaging. While economic constraints may pose challenges, they will need to be effectively managed. Packaging suppliers who recognize this shift and align their strategies accordingly will be best positioned find the right balance of resilience and efficiency for their unique organizations —and succeed in the evolving and sometimes unpredictable global market.
Read the full article on Supply & Demand Chain Executive.
About Joe Adamski
Joe Adamski has more than 12 years of advisory and consulting experience centered on strategic procurement and large-scale transformations. He has deep experience in launching and executing programs focused on strategic sourcing, supply chain, procurement strategy, organizational design, and transformations.
Earlier in his career, Joe was an Air Force pilot before joining A.T. Kearney in their consumer practice. He has consulted with numerous Fortune 500 companies in a variety of industries, including utilities, CPGs, grocery, retail, telecom, apparel, food and beverage, and government.
Joe holds a B.S. degree in Physics from the United States Air Force Academy and an MBA from Emory University’s Goizueta Business School. He enjoys boating, hiking, and spending time in the outdoors.
About ProcureAbility
ProcureAbility, a Jabil company, is the leading provider of procurement services, offering advisory, managed services, digital, staffing, and recruiting solutions. For more than 25 years, we have focused exclusively on helping clients elevate their procurement function.
We combine leading methodologies, analytics, market intelligence, and industry benchmarks with our uniquely flexible and customizable service delivery model. Global organizations of all sizes trust ProcureAbility to transform their procurement operations, drive growth, and reimagine what’s possible.
Let ProcureAbility help you reimagine your procurement capabilities.
Media contact:
Kathleen M. Pomento
Chief Marketing Officer | ProcureAbility
kpomento@procureability.com
