A guide to reducing packaging costs in 2025
As we reach the midpoint of 2025, businesses across the UK are continuing to feel the squeeze from a challenging economic landscape.
The ongoing cost-of-living crisis is driving up household expenses, while raw material prices remain unpredictable. Labour costs have increased too, with the latest rise in the National Minimum Wage and the increase in employer National Insurance contributions placing further pressure on payroll budgets.
At the same time, regulatory changes – especially the rollout of Extended Producer Responsibility (EPR) in the UK – are adding new costs for businesses that place household packaging on the market. These EPR fees, based on the amount and recyclability of your packaging, mean packaging decisions are more financially important than ever before.
At Macfarlane Packaging, we work with businesses every day to identify ways to cut packaging costs, improve efficiency and adapt to these shifting demands. In this guide, we’ll explore how you can reduce your packaging spend in 2025 – without compromising protection or performance.
You can also look at our free resource – The Ultimate Guide to Packaging Cost Reduction, packed with practical strategies and real-world examples.
-
1.
Establishing the full cost of packaging
- 1.1.
- 1.2.
- 1.3.
- 1.4.
- 1.5.
- 2.
- 3.
Establishing the full cost of packaging
Packaging costs are often misunderstood. Businesses frequently focus on unit price alone, but packaging has far-reaching effects across your entire supply chain. Inefficient packaging can drive up labour costs, increase transport charges, waste valuable warehouse space and now – thanks to EPR – lead to higher compliance fees.
Cost reduction isn’t just about finding cheaper boxes. It’s about finding smarter, optimised packaging solutions that reduce spend and add value across your operation.
There are several areas where packaging can help to effect cost reduction throughout your operation. Let’s explore each one.
Packaging optimisation to reduce unit cost
Packaging optimisation is the process of reviewing and refining your packaging to use less material while maintaining or improving protection and performance. By rightsizing packs and removing unnecessary components, you can lower your packaging spend without compromising quality.
This could include switching to lighter weight board grades, using integrated packaging solutions or removing unnecessary void fill.
Benefits include:
- Lower material use, which typically results in reduced cost per pack
- Less storage space required in warehouses
- Improved pack consistency, fewer errors and faster packing
Reducing packing time to increase labour efficiency
With labour costs rising, it’s crucial to make every minute count in your operation.
Packaging can be a hidden bottleneck. If your team is spending too long constructing boxes or filling awkward packs, productivity suffers.
Packaging optimisation can dramatically reduce packing time. From crash-lock boxes to automated systems and on-demand packaging, streamlining your process reduces labour hours and helps your team get more done with less effort.
Even a small reduction in packing time per item – say 30 seconds – can translate to substantial savings across thousands of units shipped per month. It can also mitigate the need for temporary labour during busier periods, offering another cost-saving.
How right-sized packaging can cut transport costs
Transport remains one of the biggest areas of packaging-related spend. Oversized packaging means you’re paying to ship air – whether through volumetric courier charges or underutilised vehicle space.
By switching to right-sized, fit-for-purpose packaging, you can:
- Maximise vehicle and pallet space
- Reduce shipping weight and volume
- Lower fuel use and emissions
This doesn’t just save you money, it also improves your environmental performance and helps you hit sustainability targets.
Optimise packaging to avoid damage and returns
Poorly designed packaging leads to damaged goods, which results in lost revenue, customer dissatisfaction and increased reverse logistics costs.
Optimised packaging protects your products in transit, reducing the risk of breakage and the associated cost of refunds, replacements and reputational damage.
A small investment in better packaging design can significantly reduce your return rate, saving both time and money.
Reduce Extended Producer Responsibility (EPR) fees
One of the biggest new cost drivers in 2025 is Extended Producer Responsibility (EPR), a regulation that makes businesses financially responsible for the environmental impact of their household packaging.
Under EPR, companies must report the type, weight and recyclability of their packaging, with fees based on the environmental cost of each material. That means excess packaging, non-recyclable materials and complex mixed-material designs can all increase your EPR bill.
Optimising your packaging is a powerful way to reduce your EPR costs:
- Use less material per pack
- Switch to fully recyclable or mono-material solutions
- Simplify packaging designs to improve recyclability
Businesses need to identify where small changes in material choice and design can lead to big savings in EPR charges. Not only does this help reduce your packaging footprint, but it can also improve your ESG credentials and future-proof your compliance.
If you need more information on EPR, why not download our free specialist guide Understanding Extended Producer Responsibility.
Sustainable packaging for long-term value
Sustainability isn’t just about compliance, it’s also about long-term value creation. Consumers increasingly prefer eco-friendly brands and retailers are demanding sustainable packaging solutions from their suppliers.
Fortunately, sustainable packaging doesn’t have to cost more. In fact, it often reduces costs over time, especially when it helps you:
- Mitigate waste disposal charges
- Reduce EPR fees
- Meet customer sustainability expectations
Our range of eco-friendly packaging options, like recyclable and reusable products, can help you hit your sustainability targets while keeping costs under control.
Take control of your packaging spend in 2025
In today’s economic and regulatory climate, packaging can no longer be viewed as a static cost. It’s a powerful lever you can pull to unlock savings, drive efficiency and enhance compliance.
At Macfarlane Packaging, we support businesses across the UK to transform their packaging operations through data-led audits, expert advice and tailored solutions that reduce cost and improve performance.
Would you like to know how much your business could save? Our team is ready to conduct a free packaging review and help you identify cost-saving opportunities across your operation.
If you’re looking for more insight, don’t forget to download The Ultimate Guide to Packaging Cost Reduction today. It’s full of actionable strategies and practical advice to help you take control of your packaging costs in 2025.