What: North American packaging industry faces unprecedented transformation as five megatrends reshape material choices and supply chains.

Why it is important: The convergence of geopolitical pressures and sustainability demands is forcing packaging companies to fundamentally rethink their strategies, impacting the entire retail supply chain.

The North American packaging industry's transformation is fundamentally reshaping retail operations and consumer experiences. As retailers grapple with evolving consumer preferences and e-commerce growth, packaging choices have become critical to brand differentiation and customer satisfaction. Five key megatrends are driving this change: geopolitical developments affecting trade, increasing demand for convenience, e-commerce expansion, growing health consciousness, and sustainability requirements. Through extensive analysis of retail categories and packaging types, paper and flexible plastic emerge as leading substrates, offering retailers the optimal balance of cost, functionality, and environmental credentials. For retailers, this shift demands new approaches to inventory management, store operations, and customer experience design. The transformation extends beyond mere packaging choices to impact pricing strategies, supply chain resilience, and sustainability initiatives, requiring retailers to balance immediate cost pressures with long-term strategic positioning in an increasingly competitive market.

IADS Notes: Recent market data reveals the profound impact on retail operations. In March 2025, 62% of consumers expressed concern about rising retail prices due to trade policies , while BCG's January 2025 analysis projects USD 640 billion in additional import costs . Despite these challenges, retailers are maintaining their commitment to sustainability, with February 2025 data showing 47% of companies incorporating environmental features in new product launches . This aligns with shifting consumer expectations, as 80% of Americans now consider sustainability achievable within two decades , forcing retailers to balance cost management with environmental responsibility.

Flexible by design: the new playbook for packaging in North America