The four major macro factors driving packaging trends for manufacturers of frozen food involve e-commerce, shifting global demographics, the growth of disposable income and the educated consumer, according to the 2018 Global Trends Impacting the Market for Packaging Machinery.

The study, produced by PMMI, The Association for Packaging and Processing Technologies, Reston, Va.,  supports previous research from Vision 2025, which revealed that consumers are dictating their wants and needs to consumer packaged goods (CPGs) companies.

Population growth shifts

The growth in population across much of Europe and North America has stalled, and in some cases, is beginning to decrease slowly.

According to PMMI’s report, the middle class is set to grow at 160 million people per year on average through 2030, with rapid growth in China, India, Indonesia, Thailand and Malaysia. All told, the report estimates that the next billion entrants into the global middle class will be in Asia.

The growing middle class means that a declining proportion of the population is willing to work for low wages. Rising salary expectations in individual countries may affect where investment is made in both new and existing facilities, as well as the use of automation and robotics for companies to potentially reduce labor costs. Food is no longer purchased for immediate consumption, as higher incomes allow for more expensive grocery shopping trips.

And, as salaries increase and urbanization continues, buying habits of end users are also changing. This gives a more substantial proportion of the population access to foods that were once unaffordable, including processed food products. As a result, frozen foods are finding new outlets in areas that did not previously offer access to refrigeration or where refrigeration was too costly.

Additionally, Millennials recently surpassed Baby Boomers as the most substantial generation. Preferences between these two generations vary significantly. The younger generations prefer premium, sustainable goods and convenience products, among other differences. This shift will create not only a change in the products produced, but also the packaging methodology and machinery will evolve to reflect these demands.

Becoming more socially, environmentally conscience

Millennials and Generation X are more socially and environmentally conscious than previous generations. As they become the dominant global consumers, reducing the depletion of natural resources, such as water, non-renewable energy sources and rainforests are top line items. Manufacturers are expected to drive environmentally friendly solutions throughout their operations. In addition to heightened corporate social responsibility, tighter regulations and more onerous taxes related to the protection of the environment drive investment in solutions that optimize the use of resources, minimize damage to the environment and reduce waste.

The United Nations estimates that 1.3 billion tons of food is wasted every year, costing around $680 billion in industrialized countries and $310 billion in the developing world. That’s approximately 2.6 trillion pounds of food lost annually. Food waste also wastes the resources it took to produce, process and transport it. In the United States alone, wasted food ends up in landfills, where its decomposition accounts for nearly 25% of methane emissions, a greenhouse gas 20 times more harmful than CO2, according to the Natural Resources Defense Council (NRDC), New York.

Consumers are more educated about food—where it comes from and what is in it. Improved information on nutrition and growing consumer health conscientiousness coupled with increased travel and busy lifestyles continue to drive demand for different products. The desire for healthier food and more convenient dining experiences resulted in innovation and the emergence of many new products requiring specific packaging equipment.

Changes in consumer demands and behavior, coupled with the availability of real-time consumer market information thanks to social media, has made having machinery that can quickly handle changing packaging formats a high priority for producers.

Getting in-line with online

E-commerce connects consumers and manufacturers to influence production of unique products or packaging. Since e-commerce became a valid driver in the past 5-10 years, CPGs in the frozen food space have awaited some indication of how it can get into this space. Areas where frozen food can make in-roads begin, like most things in retail, with Amazon and Walmart.

For instance, Amazon, Seattle, Wash., shook up the retail food sector in June 2017 when it purchased Whole Foods, Austin, Texas, for $13.7 billion. Within months, the online giant started offering groceries from Whole Foods on Prime Now, its 2-hour delivery offering. In less than a year, Amazon is said to be the largest seller of groceries online and is approaching 20% of the online grocery market in the United States, according to an article published in Forbes magazine.

Amazon’s leap into online grocery also knocked Walmart from its front-running perch, quickly doubling the now second place share held by the Bentonville, Ark.-based retailer. However, Walmart is not taking this defeat lying down, launching or testing several new technologies to keep up its web-based race against Amazon.

“Scan & Go” technology is now available in many Walmart stores. And, to keep pace with Prime Now, Walmart also expanded its online delivery service.