Product Size, Brand Strategy Are Key Factors Driving Change In India's Packaging Industry

In November last year, Amazon, the largest e-commerce platform in India and the world, said that it would roll out recyclable paper packaging in India. The company had already eliminated single-use plastics from its fulfilment centres in the country since 2020 and introduced boxes customised to the size of the product it held. 

Four years later, one can practically see the change. A phone cover, previously shipped in a box, now comes in a silicon envelope, and a book comes in a mailer envelope rather than a big box. 

This shift in packaging isn’t just limited to Amazon or other big players. Smaller companies, including many direct-to-consumer (D2C) brands, that now form a part of India’s booming e-commerce market, are also slowly beginning to put thought into how their products are packed. 

But in India, the size of packaging is tailored to optimise cost rather than sustainability goals. Businesses are also opting for packaging that looks and feels good as a branding strategy. 

Pavan Kumar, director at Storopack India told The Core, “Companies are aiming to reduce the cube sizes and save around 80% of their packaging costs, but this will happen gradually. It is not feasible to handle multiple box sizes. Many firms are introducing trays, paper envelopes, and padded envelopes.” 

Packing To Reduce Logistical Costs

Any product bought online passes through several warehouses and travels on multiple vehicles such as pickup trucks and two-wheelers before landing at the customer’s doorstep. This journey is usually fulfilled by logistics companies that charge brands on the volumetric weight — length, breadth, and height — of each parcel. 

Zaiba Sarang, co-founder of iThink Logistics, said, “Before sending any product, they (brands) ensure that the volumetric weight and actual weight of the product are not significantly different. To guarantee that the product weight and volumetric weight are in sync, our D2C clients have designed several box sizes to ensure that each product has precise packing and no dead weight.” 

Packaging, especially for e-commerce, wasn’t an important aspect for brands till recently. Even when companies began to sell online, they would not pay much heed to the size and volume of the package. However, now they have begun to customise packages for each product. 

Neha Shukhla, logistics manager at Ace Turtle, a tech-native retail company that handles global brands like Lee, Wrangler, Toys“R”Us and Babies“R”Us for India told The Core, "Our products are wrapped in two layers for online sale, one in a plastic bag and the other in a paper bag… we aim to pack our products in the smallest packaging possible to match the product and volumetric weight, so that we do not have to pay an additional fee to logistics firms for dead weight in our shipments." 

A significant aspect of the supply chain is the transportation of packages. Multiple boxes of different sizes and weights are stacked on top of each other during transportation. Businesses are also constantly trying to optimise packaging to ensure that products reach customers in perfect condition. 

A spokesperson of an Indian retail giant told The Core on the condition of anonymity, “Every month, we conduct an activity to determine the dimensions of the available inside package, and we then select five to six distinct outer sizes. All of our fulfilment partners' channels or retail warehouses are directed every month to utilise the most appropriate exterior sizes so that larger boxes are not wasted and the products are not damaged.” 

Keeping Up Appearances 

Brands are now also prioritising the look and feel of their packaging as they look to sell to more customers online. When a customer is buying a product offline, they can walk into a store and touch and feel the product. Premium brands want this experience for their online buyers as well. 

Gaurav Jalan, director of Packman Packaging told The Core, “I have seen that businesses are increasingly focused on packaging as a marketing and branding strategy because if their product is on the shelf, customers will only pick if the packaging is appealing. A better packaging automatically ensures that the product is worth purchasing.” 

Companies are also using a combination of sturdy outer boxes, along with branded inner packaging to maintain brand image and product safety. 

What’s Next? 

According to a Mordor Intelligence report, the Indian Packaging Market is anticipated to be worth US $84.37 billion in 2024 and is expected to reach US $142.56 billion by 2029  with an increase at a CAGR of 11.06% between 2024 and 2029.

This also means an increase in the volume of goods packed and in turn waste created from e-commerce. To reduce their environmental impact, several e-commerce firms now use recyclable, biodegradable, or compostable packing materials. This includes materials such as paper-based packaging, biodegradable plastics, and reusable packaging options.

Jalan said, “Plastic bags were popular, but the industry is gradually transitioning to sustainable packaging… so these paper bags are manufactured from recycled paper, and the bags themselves are again recyclable. Flipkart has now converted 60% of their overall packaging from plastic to paper, and with Amazon as well.” 

However, sustainable packaging also comes with a bigger price tag. According to the spokesperson of the retail giant, the cost is three to four times more than standard packing. After “careful consideration” the company has decided to only keep it restricted to premium products.