Escalating Raw Material Costs and Supply Chain Volatility in Flexible Packaging: A 2025 Outlook

In 2025, the flexible packaging industry is navigating a complex landscape marked by surging raw material costs and persistent supply chain disruptions. These challenges, intensified by geopolitical tensions, trade policy shifts, and logistical bottlenecks, are impacting profitability and operational stability across the sector.

1. Raw Material Price Volatility: A Persistent Challenge

The flexible packaging sector is experiencing significant fluctuations in raw material prices:

• Polyethylene (PE): In Europe, both high-density (HDPE) and low-density (LDPE) polyethylene prices increased by 3% and 4% respectively in Q1 2025, reaching levels not seen since early 2023.

• Aluminum Foil: The price of 7-micron aluminum foil continued its upward trend with a 3% increase in Q1 2025.

These price surges are attributed to factors such as raw material cost inflation, tighter inventory balances due to lower imports, and supply chain bottlenecks. 

2. Supply Chain Disruptions: Geopolitical and Logistical Factors

Several factors contribute to ongoing supply chain disruptions in the flexible packaging industry:

• Geopolitical Tensions and Trade Policies: Ongoing geopolitical conflicts and shifting trade agreements have introduced tariffs and export restrictions, particularly on raw materials like polypropylene resin.

• Freight and Logistics Bottlenecks: Shipping delays, port congestion, container shortages, and higher fuel costs are pushing lead times longer and increasing landed costs.

• Labor Shortages: Skilled labor shortages in film extrusion, slitting, and converting facilities have led to slower production and tighter capacity. 

3. Strategic Responses for Flexible Packaging Manufacturers

To mitigate these challenges, flexible packaging manufacturers can consider the following strategies:

• Supplier Diversification: Expanding the supplier base to include multiple sources can reduce dependency on single suppliers and mitigate risks associated with geopolitical tensions and trade policy shifts.

• Inventory Management: Adopting just-in-time inventory strategies can reduce holding costs and allow for more agile responses to market changes.

• Investment in Recycling: Enhancing recycling capabilities can reduce reliance on virgin materials and provide more control over raw material costs.

• Automation and Workforce Development: Investing in automation can alleviate labor shortages, while workforce development programs can ensure a pipeline of skilled workers.

4. Building Supply Chain Resilience

Developing a resilient supply chain is crucial for navigating the current landscape:

• Risk Assessment and Management: Implementing comprehensive risk management strategies can help identify potential vulnerabilities and develop contingency plans.

• Technology Integration: Leveraging technologies such as AI and IoT can enhance supply chain visibility and enable predictive analytics for better decision-making.

• Collaborative Partnerships: Building strong relationships with suppliers and logistics partners can improve communication and coordination, leading to more responsive and flexible supply chains.

5. Workforce Considerations: Key Positions, Compensation, and Locations

Addressing labor shortages and attracting talent are critical for maintaining operations. Below are key management-level positions in the flexible packaging industry, along with their average compensation ranges and notable employment locations:

Plant Manager

• Average Salary: $149,440 – $198,703 per year

• Key Locations: York, PA; McKinney, TX; Lakeville, MN

Supply Chain Manager

• Average Salary: $127,815 – $134,908 per year

• Key Locations: Sterling Heights, MI; Chicago, IL; Plano, TX

Packaging Manager

• Average Salary: $87,669 per year

• Key Locations: York, PA; McKinney, TX; Lakeville, MN

Quality Manager

• Average Salary: $89,450 – $90,956 per year

• Key Locations: York, PA; McKinney, TX; Lakeville, MN

Director of Packaging / Chief Packaging Officer

• Average Salary Range: $130,000 – $200,000 per year

• Key Locations: Major metropolitan areas with large packaging operations

These roles are pivotal in navigating the current challenges in the flexible packaging industry. Employers should focus on competitive compensation, career development opportunities, and strategic location planning to attract and retain top talent.

Strengthening Your Workforce with Chase & Associates

As the flexible packaging industry continues to face escalating raw material costs and supply chain volatility, building a resilient and skilled workforce becomes increasingly vital. Chase & Associates stands as a strategic partner in this endeavor. With over 50 years of experience in the packaging industry, they specialize in connecting companies with top-tier talent across various roles, including executive leadership, operations, supply chain management, and sales.

By collaborating with Chase & Associates, you can:

• Access a curated pool of industry-specific talent ready to tackle current and future challenges.

• Streamline your recruitment process, saving time and resources while ensuring quality hires.

• Enhance your team’s capabilities to navigate supply chain complexities and drive sustainable growth.

To fortify your workforce and position your company for success amidst industry uncertainties, consider partnering with Chase & Associates. Visit chaseandassoc.com to learn more about their tailored recruitment solutions and how they can support your organization’s unique needs.