Contributing writer Tom Egan is the VP of industry services for PMMI, the association for packaging and processing technologies.
Packaging machinery original equipment manufacturers (OEMs) have lofty goals to meet, satisfying CPG customers, who, in turn, must ultimately satisfy consumers who demand quality, safety and availability on store shelves.
OEMs also are tasked with designing compact, easy-to-operate and maintain equipment, which can fit into existing plant footprints and handle delicate materials without damaging products, according to the 2025 State of the Industry report from PMMI, the association for packaging and processing technologies.
To meet consumer desires, CPG companies also need equipment that supports flexibility, efficiency and user-friendliness while handling high SKU counts and innovative formats with minimal downtime. At the same time, product quality and safety remain priorities. This means integrating quality control systems like metal detectors, checkweighers and seal integrity inspectors while ensuring equipment is built to hygienic standards and is easy to clean.
Additionally, hiring and employee retention remain challenges for both OEMs and end-users.
Plus, OEMs and their customers also must navigate another stumbling block: Tariffs have become the dominant factor affecting machine building this year. Many PMMI survey respondents described the current US trade policy as unpredictable, with shifting announcements making it difficult to plan.
“Factors such as interest rates, inflation and economic uncertainty will always play a critical role in shaping capital investment and, by extension, the demand for packaging machinery,” said Jim Pittas, PMMI president and CEO. “Trade policy became a dominant theme in early 2025, with tariffs being announced, adjusted and reimposed on a range of goods.”
These shifts have introduced hesitation among capital equipment buyers, especially those with global supply chains or import exposure. As a result, while inflation has remained relatively stable during the past year, the broader investment environment has grown more cautious.
Workforce headaches persist; technology comes to the rescue
Labor remains one of the most consequential forces shaping the packaging machinery market. While employee retention has improved and hiring pressures have eased slightly, long-term labor challenges remain.
In addition, machinery buyers continue prioritizing flexibility, ease of changeover, and support for thinner or more sustainable materials. For instance, demand is strong for machinery capable of handling multiple SKUs. Plus, machines with versatile configurations and rapid, automated changeovers are being purchased more often to help manage increasingly complex production environments, enabling CPG companies to efficiently produce everything from small-batch e-commerce orders to large-scale retail packs to satisfy consumers.
Individuals interviewed for PMMI’s 2025 State of the Industry report particularly emphasized the growing necessity for automated changeover capabilities. Buyers serving diverse channels (from online retail platforms like Amazon, with small batch sizes, to wholesale outlets like Costco that require large multipacks) especially value machinery that reduces downtime during format changes.
“Even though these highly automated systems carry a premium price, customers are willing to pay when the equipment can seamlessly cover such a broad product portfolio and eliminate the hidden costs of frequent manual changeovers,” said Jorge Izquierdo, PMMI’s VP of market development. “Though some manual adjustments remain, partial automation still delivers significant operational efficiencies and competitive advantages.”
One technology gaining momentum is servo-driven actuation, particularly among larger brand owners, as it offers a compelling combination of tighter motion control, faster cycle times, and easier integration with modern PLCs and HMIs.
By eliminating many pneumatic functions, servos also sidestep the leaks, compressor upkeep and energy waste that can afflict these systems. At the same time, servo digital drives can feed performance data into predictive maintenance dashboards. However, the trade-off is a higher upfront price, which keeps some smaller, cost-conscious buyers with traditional pneumatics. Consequently, to appeal to both camps, some machine builders quote dual configurations.
Machine builders also face a growing demand to design equipment that accommodates both traditional packaging formats and emerging, innovative designs. Specifically, customers want flexibility to switch between legacy and novel packaging styles without extensive retooling or significant downtime, a trend that results from the increasing pressure on brand owners to differentiate on crowded shelves, respond to retailer-specific packaging requirements and manage growing SKU counts.
RFID provides enhanced inventory management
One technology that continues to gain traction in the packaging industry is radio frequency identification (RFID), particularly as retailers push for better item-level tracking and faster inventory reconciliation. PMMI’s interviewees reported an uptick in retrofit requests, sometimes even at the case packer or palletizer stage, to incorporate RFID tagging.
While the operational benefits are clear, the sustainability profile of conventional RFID is prompting fresh questions. Most legacy inlays include a thin metal antenna bonded to plastic, which complicates curbside recycling and can undermine brand owners’ circular packaging goals. Although this concern has not yet slowed adoption, it is becoming part of the conversation whenever new lines or upgrades are specified.
One possible solution to this issue is a metal-free tag design. If successful, such technology could offer a lower-cost, curbside-recycling-compatible alternative, triggering a new wave of machinery updates aimed at handling the next generation of RFID formats.
Regulatory policies drive paper-based alternatives
Machine builders serving global entities are being asked to support material shifts in response to regulatory pressure outside the US. One trend is the move away from polybags and toward paper-based alternatives. In part, this is a proactive response to policies in Canada and parts of Europe that restrict the use of single-use plastics.
Even US-based end users are feeling the effects of these regulations as they aim to maintain consistency in packaging across markets. This shift also creates new challenges for automated bagging and sealing equipment. Since paper has less stretch and is more prone to wrinkling or jamming, machine builders must ensure that machines are suitable for more delicate handling and accurate forming.
While material changes are increasingly being mandated by regulations both within and outside North America, major retailers are also setting their own internal goals to reduce virgin plastic and transition to recyclable materials.
Several of the largest retailers in North America, including Walmart, Target and CVS, have committed to making 100% of their packaging recyclable, reusable or compostable by 2030.
These goals are already showing up in how products are packaged on shelves. For example, Target has piloted new packaging innovations, such as fiber-based wine bottles, for some of its private label brands. While many of these efforts begin with store-brand SKUs, they often serve as early signals of what could be more broadly adopted across multiple categories.
Emphasis on productivity remains
Despite shifting regulations and continuing workforce woes, productivity is the top priority among CPG firms, according to PMMI’s 2025 Performance Optimization: Insights for Packaging Line Readiness report.
Overall success hinges on fostering a skilled workforce, streamlining operations and embracing digital connectivity, all of which can yield immediate benefits. The importance of bringing together key stakeholders from the start of a project, including machine operators, production managers, maintenance teams and IT departments, cannot be understated.
Continuous, hands-on and accessible training is also essential to successful operations. Whether employed to create checklists for vertical startups, training materials for operators, HMIs or IT communication protocols, technology is playing a growing role in all aspects of industry.
“Used strategically and safely, technology can provide the means to create ever more efficient production,” Pittas said. “Companies that refine and streamline processes, create skilled workers, and unlock the power of their IT-OT systems can create an environment of operational readiness.”
A multitude of solutions for operational readiness can be found at Pack Expo East 2026. The most comprehensive packaging and processing event in the Northeast and mid-Atlantic will bring together 8,000 attendees and 500 exhibitors at the Pennsylvania Convention Center in Philadelphia, Feb. 17–19.
Offering solutions for more than 40 vertical markets, Pack Expo East provides in-person interaction with machines, materials, and other products related to packaging and processing. The event also features free educational sessions on the show floor covering best practices, industry trends, new technology, and key concerns, such as sustainability, artificial intelligence, productivity improvement, automation and workforce development.
Philadelphia is a regional hotspot for manufacturing. With an easy-to-access location convenient to much of the eastern US, Pack Expo East allows teams to attend together for maximum return on investment. In fact, the show offers numerous opportunities for networking with fellow team members, peers, industry experts, and personnel from established suppliers and prospective vendors.
The event is large enough to provide attendees with all the solutions they need, but intimate enough for productive, face-to-face conversations with exhibitors to learn how their innovations can solve some of today’s most challenging manufacturing issues and supply chain challenges.
