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Retail Channel Fragmentation Boosts Need for Retail-Ready Packaging

The retail environment is rapidly shifting and becoming more and more fragmented. Instead of shopping at traditional grocery stores, people are finding new avenues to shop deals, buy in bulk, and shop more efficiently.

As retail transforms, one particular packaging format continues to offer efficiencies for retailers: retail-ready packaging. In the packaging industry, the retail-ready packaging, or shelf ready, has been around for years, but the evolution of channels provides extended growth opportunities for this format.

Retail-ready packaging (RRP) not only supports the growth of retail channels like value stores, club stores and traditional grocers, it is the perfect home for convenient standup pouch packages – a market that’s predicted to be worth $51.59 billion by 2020.

Value stores to grow 8 to 10 percent a year through 2020

grocery store isleImage via Flickr Creative Commons

Popularity of value or discount grocery stores such as Aldi and now Lidl are on the rise. With the German discount brand Lidl opening over 20 stores in the U.S. in 2017, it’s no wonder predictions are optimistic. Handelsblatt Global reported the channel is expected to grow by 8 to 10 percent each year until at least 2020 – five times the predicted growth rate of traditional grocery stores.

If you’ve ever walked into an Aldi, you’ll understand how important retail-ready packaging is to its business model. Aisles and refrigerated coolers brim with colorful corrugated boxes with cutouts to grab products of choice. Packaging is designed to fit each corrugated box and stand out amongst each other. Standup pouches provide wide, front-facing brand billboards that do not rotate or shift like circular-shaped containers do.

Club store growth remains strong

home goods store isleImage via Flickr Creative Commons

Retail-ready packaging is at the heart of the club store business model. Walking through a club store such as Costco, BJ’s, or Sam’s Club, you’ll notice that all the products are perfectly cubed-out and stacked nicely on skids. Thanks to retail-ready packaging, standup pouches can excel in this retail channel. And, with the continued growth of the standup pouch market, developing a packaging strategy that pairs the two together is a no brainer with club store development remaining strong.

“Club and dollar, for instance, outperformed grocery in average annual growth when measured over a three-year period. From 2013 to 2016, club channel dollar sales rose 2.6% annually, while dollar channel sales climbed an average 2.5% per year,” noted a statistic from C-Store Decisions.

Traditional retailers still need to find efficiencies

cheese packaging on shelf at storeWhile traditional grocery growth remains flat compared to value and club stores, consumers are still turning to these channels for weekly trips. Retail-ready packaging provides efficiencies for retailers for stocking and by reducing store staff hours. The ideal retail-ready package is a shipping package that also acts as a shelf-ready solution, requiring store staff to simply tear a top perforation to display the product on-shelf.

Instead of having to slide individual products on pegs or put packages neatly on shelves, products display tidier and easier with retail-ready packaging. The shredded cheese industry, for instance, is one industry that was completely improved with the combination of consumer-convenient standup pouches with retail-ready boxes, finding efficiencies in shipping and stocking, and reducing damaged goods and waste at retail.

How to win with retail-ready

Packaging World’s most recent Packaging Development Playbook outlined ways to capitalize on retail-ready packaging.

  • “Maximize the experience for consumers.” It’s not only important to capture the shoppers’ attention in store, but provide them with a positive total brand experience from the time they select the product, to how they store it in their homes, and how they reclose the packages.
  • “Maximize the experience for retail staff.” Make it easy for staff to open the package and do research on how your packaging performs. The inner packages should remain in place so adjustments do not need to be constantly made by store staff.
  • “Engage suppliers early.” Always work closely with packaging suppliers involved to ensure your retail-ready box and pouch are optimized correctly. Know your customer’s requirements as well as the consumers’ needs. Shelf dimensions need to be accounted for, as well as room for pouch reclose features, and more.

Find new opportunities with SUP + RRP

The dynamite combination of standup pouches (SUP) and retail-ready packaging (RRP) opens doors to growing channels for your business. By contacting slider and zipper suppliers like Fresh-Lock by Presto early on in your packaging journey, you’ll reduce headaches by involving all the appropriate stakeholders that are vital components to the final product. From flexible packaging for pool chemicals to protein-packed snacks and shredded cheese, there’s a slider solution for your business that will boost brand loyalty and provide ultimate consumer convenience. Contact Fresh-Lock by Presto to discuss your next project.

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