The demand for retail bags in the United States is poised for a 2.5% annual growth, reaching $4.5 billion by 2027. This growth is primarily driven by shifting towards higher-priced bags to meet regulatory requirements. Despite a stagnant number of bags being used, the foodservice market's robust expansion is offsetting unit losses in grocery and other retail stores. The implementation of retail bag regulations in various states and municipalities has considerably impacted the industry, creating uncertainty for consumers and manufacturers. While some large markets have already enacted bag bans, potential revisions or enhancements to these regulations may further influence the retail bag market. The preference for paper bags in certain applications and the controversy surrounding the efficacy of bans on thinner plastic bags are notable trends in the evolving retail bag industry.
State regulations, demand, and consumer trends are motivating retailers to modify or develop bag policies for their stores. In order to support these policies, some retail chains are rewarding consumers for using reusable bags and making recycling of single use plastics accessible.
In states that have banned single use plastic bags, Walmart
uses paper bags as their default and gives consumers the option to bring their own bags or containers or to purchase reusable bags in store. In states without these regulations, online ordering conveniently gives consumers the option to use their own bags, baskets, or other containers for pickup or delivery orders, purchase reusable bags, or to use plastic bags the store provides. Most stores also provide bins for used plastic bags, making it convenient for consumers to recycle.
For several years, Whole Foods locations have offered a ten-cent discount
for each reusable bag a consumer brings to the store. While that does not seem like a lot, that discount adds up depending on the number of bags used, and it is a nice reward for sustainable practices. Alternatively, Whole Foods provides paper bags made of “100% post-consumer recycled-content paper bags
At this time, Target is still providing consumers with plastic bags
, which are made with at least 40% recycled materials (excluding states with bag bans). They also provide reusable bags for purchase and offer a five-cent discount per reusable bag used. The unique feature that Target offers is their recycling kiosks
. Shoppers can recycle aluminum cans, glass bottles, plastic food containers and film, in addition to retail bags.
The retail bags market is embracing sustainability, witnessing a decline in plastic bag usage, and a growing adoption of reusable and paper bags, although the pace of new regulations against single-use plastic bags is expected to slow due to previous statewide bans in key states like California and New York. However, demand for reusable bags will continue to rise driven by increasing environmental consciousness, and a few states like Colorado and Rhode Island are still implementing new plastic bag bans.
To find out more about how these policies are affecting the market, as well as other factors, refer to Freedonia Group’s recently published report, US Retail Bags.