United Kingdom Packaging Market Size

Packaging in UK Market Analysis

The United Kingdom Packaging Market size is estimated at USD 59.59 billion in 2024, and is expected to reach USD 66.66 billion by 2029, growing at a CAGR of 2.27% during the forecast period (2024-2029).

The packaging industry in the United Kingdom has been witnessing significant growth owing to the increased manufacturing activities in the country that are propelling the demand for packaging and labeling solutions in the region. According to the Packaging Federation of the United Kingdom, the UK packaging manufacturing sector has annual sales of around GBP 11 billion (nearly USD 13.6 billion), employing more than 85,000 people, representing 3% of the country's manufacturing workforce. It significantly contributes to the country's GDP and is a vital link in the broader packaging supply chain.

• Moreover, the growth of e-commerce sales, increased demand from food and beverage manufacturers for eco-friendly and recyclable packaging, increasing demand for personalization of products, and the growing industrial packaging sector are driving the growth of the packaging market in the country.
• The increase in regulations for plastic use is anticipated to have a significant effect on the market. For instance, the United Kingdom's Plastic Packaging Tax (PPT), which took effect on 1 April 2022, applies to plastic packaging in the United Kingdom that contains less than 30% recycled plastic content at a rate of GBP 200 (USD 247.7) per metric tonne. The tax aims to encourage the use of more sustainable plastic packaging, increase the use of recycled plastic, and help reduce plastic waste.
• By disincentivizing the usage of unsustainable materials, the government of the UK is simultaneously incentivizing the market value of recyclable plastic, fostering a sustainable circular economy that will have global repercussions.
• Due to the gas emissions from deliveries and returns, consumers all over the country believe that e-commerce is not environmentally friendly. More than half (52%) of UK consumers surveyed in 2022 by Aquapak, a specialty polymers company that creates materials to support a circular economy, said they would be willing to pay more for environmentally friendly packaging when purchasing clothing and accessories. To receive their goods in sustainable packaging, one-third of those willing to pay more said they would add 1% to 4% to the purchase price, and nearly two-fifths (39%) said they would pay a 5% premium. 15% said they would be willing to pay between 10% and 20% more, while 8% said they would pay between 6% and 9% more.
• Amazon UK announced this year that it no longer ships items in single-use plastic delivery bags. The company started using cardboard envelopes and recyclable paper delivery bags for orders shipped from fulfillment centers. Because recyclable paper delivery bags and envelopes are more readily available in the United Kingdom, the company selected this market. Compared to other cardboard materials, the materials have a higher percentage of recycled content and take up less space.
• However, with the COVID-19 pandemic affecting the market studied, multiple companies in the market shifted toward the usage of single-use plastics. Supply chains strained to meet a surge in demand for single-use plastic packaging and medical supplies. Such a significant spike in plastic demand is likely to lead to a temporary change in the short-term initiatives and goals of transitioning toward a circular economy. Apart from this, it is also expected to put pressure on the plastic packaging manufacturing chain. Further, the Russia-Ukraine war has an impact on the overall packaging ecosystem.