Archive for category: FPI Blog

The need for speed. No, we’re not talking about Top Gun.

If 2023 was marked by a noticeable slowdown, 2024 has been about the need for speed. The pressures weighing on the foodservice packaging industry are seen in several ways when examining this year’s trends.

These pressures highlight the need to progress. And faster. This is all evident in FPI’s 2024 Trends Report.

Sustainability and the principles of sustainable packaging aren’t new, and haven’t been a “trend” in over a decade. But, this year there’s a growing sense of urgency around packaging sustainability and the justification or rationalization of choices made in this space has become a trend. No longer a “nice to have” or a “good for the environment”  option, sustainable packaging has become a required, if not regulated, part of doing business.

Companies that set 2025 packaging goals are now feeling the pressure and re-evaluating plans. It’s not a simple process to transition entire systems with numerous stakeholders and considerations. It’s complex and time-consuming, demanding careful planning and realistic timelines — not schedules accelerated by new legislation with increased pressure.

The pressure’s not all bad, particularly in the drive toward innovation. New, innovative materials and products help sustainability goals look new and fresh. Some notable changes include new coatings for fiber items that can be reheated in the container later and shifting away from color additives in favor of “natural” colored resin to help with end-of-life recyclability. Due to customer commitments and regulatory requirements, responses also show that the use of post-consumer recycled content continues to grow. We don’t expect this trend to slow down any time soon.

Legislative and regulatory changes are drawing attention toward packaging materials. As extended producer responsibility laws are implemented in several U.S. states, both foodservice operators and packaging manufacturers are contending with confusing — and often conflicting — approaches and targets. It may not be widespread but we are seeing a greater focus on reusable items for dining at restaurants, event venues and school foodservice programs which may be tied to regulatory pressures and customer demand.

Adding to the pressure is the increased complexity of packaging choices and their potential consequences. Packaging has to perform at an acceptable price point in a down market so what attributes become most important? Do companies switch portfolios from paper to plastics, plastics to paper, look at compostability, recyclability? All of the above?

New this year is the number of mentions related to increased imports. It’s clear this is a topic on the minds of much of the U.S. and Canadian marketplace — from finished goods across multiple substrates to a rise in imported machinery. A rise in imports has increased pressure on the industry to compete with imported products and equipment and the rise in imported machinery has led to anecdotes of lower costs and shorter lead times for domestic equipment.

Responses also show the continued trend of mergers, acquisitions and consolidation leading to tighter competition in the industry. More pressure.

On the flip side, automation in manufacturing has helped increase production and offset labor costs. Foodservice operators have embraced automation to combat labor shortages and work within smaller stores that only serve via drive-thru and delivery. This automation has even expanded into vending machines at airports and train stations.

Showing signs of policy and recovery aligning, respondents reported that sustainable options are still in demand from operators — even when economic factors are increasing prices. Reusable packaging is a focus for some and operator respondents are now “taking a second look” at the end-of-life pathway for packaging products, knowing that recycling and composting each have their own challenges and opportunities.

It’s clear the foodservice packaging industry will continue to face pressure but we view these challenges as opportunities to drive progress — and fast.

Now in its 16th year, our Trends Report is a snapshot into what the industry is seeing. Each year we collect opinions from companies throughout the foodservice packaging supply chain, including raw material and machinery suppliers, packaging manufacturers, distributors and operators. We take those insights and direct comments and compile them into a lengthy report. Our analysis is based on those submissions, as well as our own general industry observations.

Guess who’s back? That’s right, our good friends Fake Freddy and Truthful Teddy! Created by the FPI team in early 2019, they are the faces of an ongoing social media campaign designed to separate fact from fiction.

To refresh your memory, single-use foodservice packaging was getting a lot of media attention and not all of it was completely accurate. FPI developed a “Myths vs Facts” resource to combat all the wrong information floating around. This morphed into Freddy and Teddy, who were created to help set the record straight on all things single-use foodservice packaging.

Fake Freddy is a know-it-all who takes the things he hears at face value and does his best to spread the word — even if his information isn’t accurate.

Freddy’s buddy, Truthful Teddy, is more even-keeled and always on the lookout for the truth. He does his research to make sure he’s not spreading false information!

While these buds have been on a hiatus, they’re ready to come back and talk more about foodservice packaging. Starting in September, you can keep an eye out for their comeback on FPI’s Facebook and Instagram pages where they’ll be sharing, and correcting, some of the most widely known myths about foodservice packaging.

Freddy and Teddy will revisit everything from foodservice packaging’s impact on litter and marine debris, to the materials used in foodservice packaging. They’ll also look at how we dispose of foodservice packaging — what can be recycled or composted and how.

Armed with new and updated resources, along with plenty of “misinformation” to correct, it’s our hope that Freddy and Teddy can share useful information in a fun and engaging way, whether you’re in the foodservice packaging industry or you’re just a general consumer who likes knowing about the products used in everyday life.

We want this to be comprehensive. So if you’ve heard any pieces of misinformation and would like Freddy and Teddy to set the record straight, please send it over. Come follow along as Fake Freddy and Truthful Teddy set the record straight on foodservice packaging and don’t forget to like, share and/or comment!

It’s hard to believe it but 2024 marks the 25th annual State of the Industry Report. Throughout the years of producing this report, we’ve seen a lot of different perspectives, especially with the pandemic and economic uncertainty influencing the past few years. This year we seemed to see the industry come to the consensus of cautious optimism — despite continued inflation, many in the industry see a market that’s rebounding.

We get this snapshot every year during the first quarter by sending out the State of the Industry survey to FPI members as well as non-members within the industry. This gives us the viewpoint of folks we don’t always hear from, and it provides non-member participants a chance to view the report. Most importantly, it tells us what the industry thinks when looking back at 2023 and ahead to 2024.

This year, the report truly highlights the fact that the industry is just as cautiously optimistic as the FPI staff. Only 34% of foodservice packaging manufacturers and suppliers experienced growth in volume, compared to 60% in the previous survey. This is demonstrated in profit growth with more than 60% worsening or staying the same in 2023 compared to 2022. Highlighting the optimism, nearly 60% of the industry expect volume expansion and 77% expect profits to grow or remain the same. Foodservice operator respondents saw increased sales and were optimistic that this trend would continue in 2024.

In yet another sign that the market is stabilizing, nearly 40% of the North American manufacturers respondents reported another year of planned corporate expansion primarily through expansion of current facilities, an increase over 2023. Consistent with previous years, 60% of North American converter respondents plan to purchase machinery in 2024.

While long noted as an area of opportunity, chain quick-service restaurants are now seen by survey respondents as one of the greatest areas for market expansion, followed closely by perennial favorite, the fast casual segment. This is due in part to the convenience of being able to eat foods on-the-go or away from home. Grocery stores and convenience stores are also noted as opportunities for market expansion because of increased foodservice options. As always, convenience was noted as an influence across all market segments.

It’s really encouraging to see a wave of optimism coursing through the foodservice packaging industry, in spite of a challenging few years. Our industry is finding pathways to growth and expansion while showcasing the resilience and adaptability at its core.

We’d like to thank the organizations that participated in this year’s survey. If you haven’t participated before, but are eligible (raw material or machinery supplier, converter, foodservice operator or foodservice distributor), please think about participating next year. We realize it’s a time commitment on your end, but the survey is meaningful because of your responses. If you’d like more information or would like to be on our list for next year, let us know.

The Foodservice Packaging Institute (FPI) recently released its 15th annual Trends Report, offering a comprehensive look at the current state of the industry. Despite facing challenges such as stagnation of orders and slower purchasing throughout the supply chain, the report also highlights positive shifts and emerging trends that shape the foodservice packaging landscape in 2023.

International Shipping and Equipment Timelines:

One notable aspect revealed in the report is the positive impact of decreased international shipping costs. Natha Dempsey, president of FPI, noted that this reduction has facilitated smoother import and export experiences for industry players. Additionally, timelines for equipment procurement have eased, albeit with some delays for in-demand machinery. As market dynamics evolve post-COVID, there is a notable uptick in the purchase of foodservice packaging through e-commerce channels.

Changing Dynamics in Office Environments:

The report underscores the rebound in demand for operators catering to office environments, even though full-time in-office attendance remains significantly below 2019 levels. With a large portion of the workforce embracing flexible or hybrid work arrangements, dayparts have become more fluid, catering to consumers’ preferences for meals and snacks whenever and wherever they want them.

Post-Pandemic Shifts and Inflation:

Operators are adapting to post-pandemic shifts, particularly in response to inflation. Consumers, feeling the financial pinch, are seeking value for money, leading to a surge in nostalgic meal deals that harken back to better days. Despite the challenges posed by inflation, service fees have become a significant burden, prompting a shift away from delivery toward takeout. This shift is so pronounced that operators are increasingly opting for smaller format, smaller footprint locations with an emphasis on drive-thru, to-go, and delivery services.

Extended Producer Responsibility (EPR) Discussions:

Policy considerations remain a top concern for industry respondents, with Extended Producer Responsibility (EPR) discussions taking center stage. Legislation, especially concerning EPR, emerged as the number one topic in the survey. As sustainability and environmental concerns continue to gain prominence, stakeholders are actively engaging in discussions to address the responsible management of packaging waste.

Conclusion:

For 15 years, the Trends Report has been a valuable resource for reflecting on the latest happenings in the foodservice packaging industry. The 2023 report not only highlights the challenges faced by the industry but also showcases the resilience and adaptability of the industry in navigating the evolving landscape. As the industry grapples with changes in consumer behavior, market dynamics, and regulatory considerations, staying informed and agile remains crucial for sustained success.

FPI members can access the complete 2023 Trends Report, while non-members can view an executive summary on FPI’s website. For further information, interested parties can contact Ashley Elzinga at aelzinga@fpi.org.

Foodservice packaging items, like paper and plastic cups, plates and bowls, were invented over 100 years ago to provide a more sanitary alternative to their reusable counterparts and help protect public health. Over the years, FPI has commissioned independent studies with third-party laboratories to compare the sanitary quality of single-use foodservice packaging and reusable options. The last study was conducted in 2012 in Sacramento County, California. Since 2012, reuse models for takeout and delivery have emerged and gained interest as sustainability measures and reporting, along with the impact of disposable items on the environment and potential cost-savings of reducing use of disposable items, became more highly scrutinized.

The objective of the new study was to conduct a survey of reusable takeout and delivery items, single-use items and dine-in reusable foodservice items to determine the sanitary quality of these items in foodservice establishments in North America.

Three types of foodservice items were tested: reusable dine-in, reusable to-go durables and single-use items. Sanitation levels were tested by conducting three microbiological analyses on each item. Along with aerobic plate count microbial levels, the study also compared levels of Coliform and Staphylococcus bacteria. The results show that there were no differences observed in Coliform counts and there were no significant differences between reusable dine-in and disposable items; findings which contrasted with the 2012 study. Staphylococcus was only found in very low levels across all types of foodservice items, which remains consistent with the 2012 study.

Overall, reusable to-go durable foodservice items had higher aerobic plate count microbiological levels than reusable dine-in and single-use items. Previous studies in other parts of the country have shown confirming results where reusable items had higher microbiological counts than single-use items. Variances could be attributed to any number of factors, including handling by foodservice employees or changes in dishwashing technology.

FPI members received complete survey results. A complimentary executive summary of the report is available at FPI.org/resource. For more information, contact FPI’s Ashley Elzinga at aelzinga@fpi.org.