Bag-in-Box Containers: Making Packaging Synonymous to Sustainability

The packaging industry has had a pivotal role to play in environmental remediation activities, especially since the rise of the e-Commerce industry. With governing bodies as well as consumers voicing the need for environmentally safer and sustainable packaging, a mounting number of packaging companies are probing into innovating materials and types of environmentally-friendly packaging.

Bag-in-box containers are gaining immense popularity as an apt alternative for rigid packaging solutions, which were the workhorse of the packaging industry until a few years back. Bag-in-box containers have emerged as an efficient type of packaging that enables companies reduce the carbon footprint of their businesses. Leading players in the bag-in-box containers market are leveraging this trend in product promotions and creating a new brand identity.

Sensing the palpable shift from rigid packaging to flexible packaging solutions, which is driven by increasing environmental concerns, Transparency Market Research (TMR) investigates more into the changing strategic viewpoint of market players. In its latest offering, TMR offers a deep dive into the macro and microeconomic factors striking a significant impact on the growth of the bag-in-box container market, and provides actionable insights for market players to make value-based decisions in the coming years.

Bag In Box Container Market Strategies

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Food & Beverage Industry Fostering the Market with One-third Revenue Share

The packaging industry is set to touch the US$ 1 trillion mark with the widening range of its end-use industries. The increasing demand for innovative packaging solutions in the food & beverage industry has been bolstering innovation in packaging since the past decade. As the food & beverage industry remains the largest consumer of packaging solutions, increasing awareness about hygiene and demand for convenience has stroked a shift from rigid to flexible packaging.

With the food & beverage industry gravitating towards flexible packaging solutions such as bag-in-box packaging, the global market for bag-in-box containers gained momentum. In 2018, the market recorded sales of ~870 thousand tons, reaching a valuation of ~ US$ 2.9 billion. Though the demand for bag-in-box containers has spread across various end-use industries such as chemicals and cosmetics & personal care, the food & beverage industry remains the largest end user of bag-in-box containers.

An upsurge in the demand and growing availability of innovative materials have been the primary driving engines for the bag-in-box containers market. However, the emergence of cubinators—cube-shaped liquid handling packaging solutions—as an alternative to bag-in-box containers can hamper market growth. Cubinator manufacturers are entering the food & beverage space to capitalize on its increasing growth, intensifying the competition for bag-in-box container manufacturers in the landscape.

Will the Shift from Paper to Plastic in Bag-in-Box Containers End the ‘Paperboard Economy’?

Plastic is considered harmful to the environment; however, the bag-in-box containers landscape is spurning paper and paperboard materials to adopt plastic. Manufacturers’ focus on reducing the carbon footprint of their businesses, along with manufacturing costs, is mainly attributed to the shift from paper to plastic in the bag-in-box containers space.

In 2018, various types of plastics manufactured with different polymers, such as Low-density polyethylene (LDPE) and Ethylene vinyl alcohol (EVOH), accounted for one-fourth revenue share of the bag-in-box containers market. With ongoing developments in the engineered plastics industry, the adoption of plastics is expected to increase at a rapid pace in this landscape, accounting for one-third revenue share of the market, in the coming decade.

Though plastic is becoming the workhorse material for most end-use industrial verticals, paper and paperboards will remain impervious to the spread of plastic across the bag-in-box containers market in the foreseeable future. Much more paper and paperboards are recycled than plastics, consuming relatively much lesser energy. Thereby, the idea of plastics completely replacing paper and paperboards in bag-in-box containers is still unworkable, and manufacturers will continue to build their strategies based on employing a combination of both the materials in this landscape.

Bag In Box Container Market North America

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Deep Dive into the Competitive Landscape of the Bag-in-Box Containers Market

The bag-in-box containers market is moderately fragmented, and lucrative opportunities in the packaging industry are expected to boost the number of new players entering this market. Top companies in the bag-in-box containers landscape, including Smurfit Kappa Group, DS Smith, Liqui-Box, Scholle IPN, Amcor Limited, CDF Corporation, TPS Rental Systems Ltd., and Optopack Ltd., cumulatively account for ~ 45% of the total revenue share in the market.

Leading players in this landscape are competing on innovation and expansion in plastic packaging facilities as well as upgrading their manufacturing technologies to maintain their stronghold in the market. For example, in January 2019, Smurfit Kappa launched a new high-speed, triple head, and automatic filling machine that can fill up to 45 3-liter packs of bag-in-box containers per minute. In March 2019, Liqui-Box announced that it would acquire DS Smith’s plastic division to upscale its position in the flexible and rigid packaging industry.

Other competitors in the bag-in-box containers market are adopting strategies to capitalize on the increasing growth of the wine industry by introducing more efficient and safer packaging solutions. The wine industry has been voicing the need for hygienic and high-standard packaging solutions for improving the shelf life of bag-in-box wine, and this will continue to have a significant impact on the upcoming strategies of emerging players in the market. In addition, profitable sales opportunities in the dairy industry and juice industry are expected to create new avenues of growth for new entrants in the bag-in-box containers landscape.

bag in box container market segmentation

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Analysts’ Viewpoint

Authors of TMR’s study on the bag-in-box containers market remain optimistic about the growth prospects of this landscape, and estimate that the market is set to grow ~1.5X between 2019 and 2027. Consumer goods companies are adopting marketing strategies to create a new, environment-friendly brand identity, with consumers becoming more aware and conscious about the ecological impacts of industrial operations. This is expected to augur well for manufacturers in the bag-in-box containers landscape.

Though paper & paperboards are witnessing high demand in the market, innovations in plastics are expected to direct the emerging trends and influence the upcoming strategies of leading market players. In addition, manufacturers will have to ready themselves to face the increasing competition from cubinators, which are gaining popularity as an efficient alternative to bag-in-box containers.

Manufacturers who will introduce bag-in-box containers as a more hygienic solution for the wine industry to improve shelf life and maintain high food safety standards will survive the increasing competition in the market.

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  • The global market for bag-in-box containers market was valued at ~ US$ 2.9 Bn in 2018, and is projected to register a CAGR of ~ 5.0% during the next eight years.
  • Bag-in-box containers are specialized containers used for the storage and transportation of liquid products. They are made of corrugated box and plastic material such as LDPE, ethylene vinyl acetate, and others.

Research Scope: Bag-in-Box Containers Market

  • The global bag-in-box containers market has been segmented on the basis of capacity, material type, and end use.
  • By end use, the global bag-in-box containers market has been sub-segmented into food & beverages, industrial, and cosmetics & personal care.
  • Furthermore, the food sub-segment is sub-divided into alcoholic beverages, non-alcoholic beverages, dairy products, water, sauces, vinegar & flavouring, and liquid egg products, among others.
  • The alcoholic beverages sub-segment, especially wine packaging, is expected to drive the global demand for bag-in-box containers.
  • The rising demand for aesthetic and luxury packaging for alcoholic beverages is expected to lead to the higher consumption of bag-in-box containers during the next decade. However, demand from the non-alcoholic beverage segment is expected to fuel the changing packaging trends in fruit juices, energy drinks, ice tea, & coffee manufacturing industries.
  • Also, bag-in-box containers are witnessing demand from industrial goods such as chemicals, inks, oils, lubricants, and floor cleansers, among others, which is expected to propel the bag-in-box containers market during the next decade.
  • By capacity, the global bag-in-box containers market has been segmented on the basis of less than 5 liters, 5 - 10 liters, 10 - 15 liters, 15 - 20 liters, and more than 20 liters. Among the capacity segments, less than 5 liters capacity bag-in-box containers are expected to create high revenue growth during the forecast period.

Initiatives by Wine Producers to Reduce Carbon Footprint Expected to Boost Demand for Bag-in-box Containers

  • Based on Environment Impact Assessment (EIA) studies, CO2 emission in bag-in-box containers manufacturing is eight times less than during the manufacturing of alternative packaging options such as glass bottles.
  • In 2001, 2.6 million liters of wine was produced globally, and over 5 million tons of greenhouse gases resulted from the production and distribution of wine, which accounted for 0.08% of overall global carbon emissions.
  • Increasing consumer awareness about ‘carbon footprint’ is, in turn, leading to the preference for environmentally-friendly products. Various industries, including the wine industry, in line with this changing consumer sentiment, are introducing green products in the market.
  • Bag-in-Box containers are one such packaging option that wine producers are exploring. Certain wine producers such as Sutter Homes, Three Wine Company, and Virginia Wineworks are replacing existing brands of wine bottles with bag-in-box containers. This trend is expected to be adopted by other wine producers too in the near future.

Cost-effectiveness of Bag-in-Box Containers

  • Bag-in-box containers are 30–45% more cost-effective as compared to their counterparts such as metal and glass.
  • Bag-in-box containers are also lightweight, and this aspect reduces overall transportation and handling costs.
  • Also, high barrier films used as bladders in bag-in-box containers help food & beverage product manufacturers extend the shelf life of products. Extended shelf life of products allows retailers to increase shelf display time, thus minimizing product wastage.

Bag-in-Box Containers Market: Restraints

  • Though bag-in-box containers are cost-effective packaging solutions when compared to conventional packaging options, additional equipment costs associated with bag-in-box containers packaging are anticipated to restrict the adoption of bag-in-box containers across the industrial end-use segment.
  • Newly developed liquid packaging solutions such as cubitainers do not require dedicated machinery, and hence, reduce overall capital expenditure. This can inhibit the adoption of bag-in-box containers for a few applications, mainly in the industrial segment.

Bag-in-Box Containers Market: Region-wise Summary

  • Europe is estimated to represent the highest incremental $ opportunity for the bag-in-box containers market during the next eight years. This is due to the high penetration of bag-in-box container packaging for wines and other alcoholic beverages.
  • Europe is home to some of the largest vineries in the world. All wine manufacturers are looking for packaging solutions that offer aesthetic appeal to their products. Bag-in-box containers are widely adopted by wine manufacturers across Europe, which is expected to catapult the demand in the near future.
  • Europe is closely followed by North America, where the demand for luxury packaging is consistently expected to grow during the forecast period.

Bag-in-Box Containers Market: Competition Analysis

Key players profiled in the research report on bag-in-box containers include

  • Smurfit Kappa Group,
  • DS Smith 
  • Amcor Limited 
  • Liqui-Box,
  • Scholle IPN
  • CDF Corporation
  • Vine Valley Ventures LLC
  • Parish Manufacturing Inc.
  • TPS Rental Systems Ltd. 
  • Optopack Ltd. among others.

Transparency Market Research (TMR) recently published a study on the bag-in-box containers market, which offers an overview of the market. TMR’s study provides readers with a detailed explanation on the market dynamics, including trends and avenues of growth for stakeholders in the market through 2019-2027. In this study, detailed analysis on various factors influencing the developments in the bag-in-box containers market is included, along with qualitative as well as quantitative insights on the future growth of the bag-in-box containers market.

The study includes information about factors that are influencing the expansion of the bag-in-box containers industry, including world GDP indicators and other macro and microeconomic factors that are driving or impeding market growth. A detailed analysis on the pricing and adoption of bag-in-box containers has also been presented in a comprehensive manner in the TMR study.

The information featured in the TMR’s study on the bag-in-box containers market can help market players, including manufacturers, retailers, suppliers, and distributors adopt appropriate strategies. Readers can also find an assessment on how demand for bag-in-box containers is changing trends across various end-use industries, in this TMR’s study. The study also offers important information about the global as well as regional markets for bag-in-box containers, which can help decision-makers in the market build important strategies in the coming years.

Key Questions Answered in TMR’s Bag-in-Box Containers Market Report

  • What are the risks of investing in the bag-in-box containers markets in developing countries?
  • Which strategies proved successful for leading players in the bag-in-box container landscape to gain a competitive edge?
  • Which regions will prove to be the most lucrative for bag-in-box container providers in the coming years?
  • How are the recent trends in the cosmetics & personal care industry impacting the growth of the bag-in-box containers landscape?
  • What are the critical challenges faced by bag-in-box container companies in this market?

Research Methodology

A robust approach and unique research methodology is utilized by TMR to conduct the trend analysis for the bag-in-box containers market, and reach conclusions about market size-related information. With the help of statistics and data verified by several resources - both, secondary and primary resources - analysts could come up with exclusive insights on how the bag-in-box containers market will expand through the course of the forecast period.

Secondary resources that have contributed to the production of this report include various government documents, white papers, regulations, and research papers that highlight the sales potential for bag-in-box containers. Secondary resources have been referred to by analysts to confirm the accuracy of the forecast on the growth prospects and future trends the bag-in-box containers market.

Analysts have interviewed c-level executives and brand managers of companies in the supply chain of the bag-in-box containers market, as well as investors and industry experts, all of whom contributed to the development of this report as a primary resource. Exclusive information provided by primary resources and secondary resources acts as the validation from industry players, and makes TMR’s estimates on the future prospects of the bag-in-box containers market more accurate and reliable.

Segmentation of the Bag-in-Box Containers Market

TMR’s study on the bag-in-box containers market has been segmented into four categories - material type, end use, capacity, and region. The information featured in the study helps readers understand the growth prospects of the bag-in-box containers market according to the aforementioned segments.

Material Type

  • Paper & Paperboard
    • Corrugated Cardboard
    • Solid Board
  • Plastic
    • LDPE
    • EVA
    • Metallized PET
    • EVOH
    • Nylon
    • Others

End Use

Food & Beverages

  • Alcoholic Beverages
    • Wine & Spirits
    • Beer
    • Others
  • Non-alcoholic Beverages
    • Fruit Juice & Pulp
    • Sports & Energy Drinks
    • Ice Tea & Coffee
    • Others
  • Dairy Products
  • Water
  • Sauces, Vinegar & Flavorings
  • Liquid Egg Products
  • Others
  • Industrial
    • Chemicals
    • Detergents
    • Floor Cleansers
    • Lubricants
    • Oils
    • Adhesives
    • Inks
  • Cosmetics & Personal Care
    • Creams & Lotions
    • Shampoos & Conditioners
    • Others

Capacity

Less than 5 Liters

  • 5 to 10 Liters
  • 10 to 15 Liters
  • 15 to 20 Liters
  • More than 20 Liters

Region

  • North America
  • Latin America
  • Europe 
  • APAC
  • Middle East & Africa