Gartner predicts that 75% of organizations will replace voluntary packaging goals with legislative guidelines by 2028, and encourages companies to achieve a competitive advantage by aligning with current and upcoming sustainability requirements.
Several big brands have already missed their sustainability targets for 2025, citing reasons such as unavailable infrastructure, limited access to recyclate, and consumer behaviour.
Product and packaging design strategies are now being shaped around sustainability, labelling, and reuse requirements within existing recycling infrastructure, Gartner reports – replacing the previous focus on cost and consumer appeal.
This might include implementing reusable packaging systems like collection and redistribution into existing supply chains and logistics; speeding up packaging redesign cycles, which can take two years or more; and considering legislative requirements when developing new products and planning for capital.
Companies are expected to gain a competitive advantage by designing their packaging for circularity – this includes ensuring that packaging dimensions, labels, and colour additives do not impact a pack’s recyclability – as well as matching their chosen materials to recycling infrastructure in target markets, and making sure suppliers can offer the necessary quantities of sustainability-minded packaging materials.
Conversely, failing to account for packaging legislation may drive up costs in the long term, incur non-compliance fees, or compromise a company’s market position, possibly even threatening its market access.
“Organizations that fail to prioritize packaging legislation in their design and sourcing strategies risk losing market access and eroding margins as EPR fees rise,” explained John Blake, senior director analyst in Gartner’s Supply Chain practice. “Proactive compliance protects market position and also creates opportunities for differentiation in an increasingly regulated environment.”
Numerous US states have adopted the ‘global policy trend’ of passing extended producer responsibility (EPR) legislation, placing the financial responsibility for packaging waste and recycling on producers and manufacturers.
This requires organizations to sign up with a Producer Responsibility Organization, which oversees the collection, recycling, and reporting obligations. Companies are expected to submit detailed data on packaging materials, quantities, and recyclability, complying with various rules across jurisdictions.
“Many organizations are currently unprepared for these new requirements, lacking the data management tools and resources needed for compliance. Longer term, legislation can lead to significant costs for PRO fees and fines, alternative materials, and supply chain adjustments,” said Blake.
According to Gartner, chief supply chain officers (CSCOs) must prepare internal profit and loss owners for increased costs stemming from new packaging legislation, expected to reach ‘millions’ of US dollars.
“By the end of this year, Gartner predicts that 90% of public sustainable packaging commitments will remain unmet, as organizations continue to rely on plastics and single-use packaging,” Blake concluded. “With packaging rules rapidly evolving, CSCOs must shift their focus to meeting EPR requirements, which will demand new investments in data management, package design and compliance resources.”
Gartner wraps up by encouraging CSCOs to educate all their functional teams on the implications and risks of packaging EPR legislation; this should include marketing, R&D, manufacturing, risk, compliance, and IT.
Suppliers, procurement, transportation, manufacturing, and all players in the supply chain ecosystem should be consulted to overcome the complexities of sourcing materials and implementing return networks for reusable packaging.
Finally, packaging legislation should be upheld as a core element of corporate packaging strategies, as it is expected to have direct implications for design, material sourcing, and manufacturing decisions in the future.
Gartner clients are invited to read A CSCO’s Guide to the Impacts of Packaging EPR Legislation, while non-clients can consult CPG Supply Chain Solutions.
Other commentary from Gartner includes Blake’s advice on keeping up with packaging trends, linking the worldwide development of sustainable packaging legislation with revised sustainable packaging targets, investments in packaging data management, upgrades to label and artwork management, and more.
Another survey has also suggested that 45% of supply chain leaders are mitigating tariff-related costs by passing costs onto customers. This came as interviewees highlighted rising costs and consumer demand as primary concerns.
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