Over the past decade, Financial Technology (FinTech) companies have revolutionised the banking landscape, compelling large, multi-branched retail banks to reassess their business models. Leveraging innovative digital technologies, FinTech startups have introduced solutions that enhance user experiences, streamline operations, and provide cost-effective alternatives to traditional banking services. This disruption has forced traditional banks to cut their branch networks, reduce costs, and invest heavily in updating outdated technology and legacy systems. As the printing and packaging industry stands on the brink of similar transformations, the question arises: will large printing and packaging companies withstand or succumb to disruptive competitors like their banking counterparts?
FinTech companies leveraged technology to create user-friendly platforms for banking services. Mobile apps, online banking, peer-to-peer payment systems, and automated investment platforms offered consumers a streamlined experience unmatched by traditional banks. The rise of blockchain and cryptocurrency solutions also forced banks to innovate their offerings to include digital currencies and secure transaction technologies. This was driven by the digital-disruptor; they were like speed boats pitched against supertankers in a sprint for supremacy. FinTech companies adeptly navigated financial regulations, allowing them to innovate faster than legacy banks. As regulatory bodies began to streamline rules surrounding digital services, FinTechs seized the opportunity to fill service gaps left by traditional banks.
The print and packaging industry is undergoing a transformative shift, heavily influenced by evolving regulations focusing on sustainability, waste reduction, and environmental accountability. As large print and packaging companies adapt to these regulations through a sustained programme of lobbying, they are leveraging their scale to exert pressure on medium and small-sized competitors, driving a wave of mergers and consolidations. Much like the disruption witnessed in the financial services sector with the rise of FinTech companies, the printing and packaging realm is poised for its own disruption by innovative PrintTech start-ups. These emerging players are leveraging advanced technologies, such as AI, cloud storage, and cutting-edge printing methods; all to enhance efficiency, compliance, and sustainability, and competitiveness, thereby reshaping the industry's landscape. They are focused on providing customised solutions, improving efficiency, and enhancing sustainability, appealing to environmentally-conscious consumers and businesses.
In recent years, a host of regulations worldwide have stressed sustainability, particularly concerning packaging waste and material recycling. Initiatives such as the European Union's Circular Economy Action Plan, California's Assembly Bill 1080, and various local and national regulations around plastic use are forcing print and packaging companies to rethink their strategies. Large corporations, equipped with the resources to adapt swiftly to these changes, can align their practices with these regulations more easily than their smaller counterparts. As large print and packaging companies embrace sustainable practices and regulatory compliance, they can create competitive pressures that smaller firms struggle to meet. These pressures manifest in several ways:
Price Competition: Large companies can absorb the costs of investments in technology and sustainable materials better than smaller businesses. As they compete aggressively on price, smaller companies may find it challenging to match these rates without compromising their margins.
Resource Allocation: The ability to invest heavily in research and development allows larger firms to explore innovative packaging solutions that comply with regulations and appeal to environmentally conscious consumers, leaving smaller companies with limited options.
Integration of Technology: Larger firms can deploy advanced technologies such as automation and AI to streamline operations and reduce waste. Smaller companies often lack the capital to implement such technologies, putting them at a disadvantage and leading some to consider merging with or acquiring competitors to stay afloat.
In response to these pressures, the print and packaging industry is witnessing a trend toward consolidation. Mergers and acquisitions can offer several strategic advantages, such as combined resources, shared technologies, diversified portfolios, and enhanced market positioning. As competitive dynamics shift, smaller companies might find themselves navigating the difficult decision of merging with larger counterparts or aligning with other mid-sized companies to ensure survival.
Large printing and packaging companies often operate with legacy printing technologies that may not support the agile, sustainable practices demanded by today’s market. As consumer preferences shift, those companies may find it challenging to adapt without significant investment. As new regulations around sustainability and waste management are enacted, companies failing to modernise their practices may face challenges in compliance, leading to further competitive disadvantages. If the regulatory environment is anything like financial regulation, it will change, and change, and change.
Amid these changes, the rise of PrintTech disruptor companies represents a seismic shift similar to the advent of FinTech in banking. These innovators are redefining traditional models by embracing a high-tech approach that focuses on efficiency, sustainability, and compliance, effectively mitigating the risk of greenwashing, where companies falsely present their policies as environmentally friendly.
PrintTech companies utilise advanced printing technologies like digital printing and 3D printing. These methods not only reduce waste but also allow for greater customisation and shorter production runs, ideal for responding to specific market demands while adhering to regulatory requirements. Disruptive PrintTech companies can operate on leaner business models, often avoiding the entrenched overheads of traditional firms. Their agility enables them to pivot rapidly to changing consumer and regulatory demands, a lesson learned from the agility observed in the FinTech sector. By utilising advanced technologies, these firms can produce high-quality materials on-demand, reducing waste and aligning with sustainability goals.
By employing AI in operations and supply chain management, PrintTech companies can optimise processes, predict trends, and enhance customer experience. AI enables them to analyse regulatory changes in real-time and quickly adjust practices, setting them apart from traditional businesses.
Cloud computing enables PrintTech firms to store and manage vast amounts of data efficiently, including supply chain information about material sourcing, recycling, and compliance with regulations. This transparency fosters trust among consumers and partners, further separating these companies from those accused of greenwashing.
PrintTech companies are increasingly forming partnerships with brands that prioritise sustainability. By integrating sustainable practices within their offering, PrintTech firms can develop products that meet the rigorous demands of eco-conscious consumers while adhering to regulatory standards.
The print and packaging industry stands at a crossroads marked by regulatory pressures, competitive dynamics, and technological innovations. Large firms can leverage new regulations to consolidate their market positions, leading to a wave of mergers and acquisitions that may threaten the survival of mid-sized and smaller players. However, the emergence of PrintTech companies represents an exciting avenue for disruption within the industry, bringing high-tech solutions that focus on sustainability and compliance to the forefront.
These PrintTech innovators have the potential to redefine how printing and packaging are conducted, ensuring efficiency, transparency, and environmental responsibility. As the sector transitions into this new era, the very fabric of the print and packaging landscape is likely to be dramatically reshaped, with a clear nod toward achieving shared sustainability goals, while fostering a more integrated and technologically advanced industry. As regulation drives change, the response from the entire supply chain will be vital in navigating what is sure to be a crucial period of evolution.
Unlike traditional banks, which faced the urgent need to transform their service models, large printing and packaging firms can proactively evolve by investing in new technologies rather than reacting to existential threats. Established companies can strategically acquire or partner with innovative PrintTech startups to enhance their technological capabilities and avoid the fate of becoming obsolete.
While the disruptive potential of PrintTech companies is significant, large firms that embrace innovation and leverage their resources can effectively fend off these competitors. By focusing on R&D and investing in energy-efficient, sustainable practices, they can retain market leadership. The printing and packaging industry may also see collaborative ventures that focus on shared technological advancements rather than adversarial competition.
The demand for sustainable packaging solutions, reduced waste, and customisable products will drive both large and small players to innovate continuously. Companies that can align with consumer values related to sustainability will have a competitive edge. Failure to recognise and adapt to these evolving expectations may lead to a slow decline similar to that experienced by traditional banks.
The disruptions seen in banking due to FinTech have set a precedent that the print and packaging industry may face in coming years. While large printing and packaging companies possess the resources to adapt and innovate, their success in navigating this evolving landscape will depend on their willingness to embrace change, invest in new technologies, and engage with emerging PrintTech competitors. By prioritising modernisation, efficiency, and sustainability, traditional firms can position themselves not only to survive but thrive amid disruption, safeguarding their market relevance in an increasingly competitive environment.
About the Author - John Gilchrist
John's particular interests lie in future trends and scenario development and his use of AI to ‘modernise’ the values and beliefs of yesteryears and today’s great ‘influencers’ offers a different perspective on the net zero, sustainability, and the circular economy debate.
