Retailers Struggle with 2025 Packaging Reduction Goals

Major Retailers Fall Short on Ambitious Packaging Targets

As 2025 unfolds, major retailers including Walmart, Target, and Amazon are confronting the harsh reality that their ambitious packaging reduction goals are proving more challenging than anticipated. Despite years of sustainability commitments and public pledges, these retail giants are scaling back expectations and pushing deadlines further into the future.

'We're seeing a perfect storm of supply chain constraints, regulatory complexity, and consumer behavior patterns that make these targets incredibly difficult to achieve,' says packaging sustainability expert Dr. Elena Rodriguez. 'What looked achievable on paper five years ago has collided with real-world limitations.'

The Supply Chain Revolution That Wasn't

Retailers had envisioned sweeping supply chain transformations that would reduce packaging at every stage—from manufacturing to distribution to store shelves. Walmart, for instance, aimed for 100% recyclable, reusable, or compostable private-brand packaging by 2025 but currently only achieves 68%. The company reported using nearly 1.07 million metric tons of virgin plastic in 2023, largely due to growth in food product categories.

Target's 2025 sustainability report reveals similar struggles. The retailer won't meet several key packaging goals, including making all owned brand plastic packaging recyclable, compostable or reusable (currently at 34% vs. 100% goal), reducing virgin plastic use by 20% (still 10% above baseline), and incorporating at least 20% post-consumer recycled content (currently at 13%).

'The supply chain isn't just about moving products—it's about redesigning entire material flows,' explains supply chain analyst Michael Chen. 'Companies are discovering that sustainable packaging requires rethinking everything from material sourcing to consumer education.'

Recycling Partnerships Face Infrastructure Gaps

Retailers' partnerships with recycling organizations have revealed significant infrastructure limitations. The Sustainable Packaging Coalition (SPC) recently launched a Retailer Forum with major companies including Amazon, Walmart, CVS Health, and Target to address sustainable packaging challenges. Their inaugural project focuses on developing sustainable flexible packaging films with low-barrier requirements—materials commonly used for products like polybags and refill packs.

However, current recycling systems can only process polyethylene-based flexible packaging, creating a bottleneck for innovation. 'We're caught between technological possibilities and infrastructure realities,' notes recycling industry veteran Sarah Johnson. 'New materials need new processing capabilities, and that investment takes time.'

Specialized recyclers like Ridwell and Girls With Glass are emerging to fill gaps in municipal recycling systems for hard-to-recycle formats, but these remain niche solutions rather than systemic changes.

Consumer Impact: Willingness vs. Action

McKinsey's 2025 global consumer survey on packaging sustainability reveals a complex picture. While environmental concerns remain important, price and quality continue to be the dominant factors influencing purchasing decisions. Food safety and shelf life are the most critical packaging characteristics for consumers globally.

Recyclability is viewed as the most important sustainability trait, with glass and paper ranking high across all geographies as sustainable materials. Despite ranking environmental factors lower than in previous surveys, a majority of consumers claim willingness to pay more for sustainable packaging, particularly younger generations (Gen Z and millennials) and higher-income consumers.

'There's a significant gap between what consumers say they want and what they actually purchase,' observes consumer behavior researcher Dr. Lisa Park. 'When faced with a choice between sustainable packaging and lower prices, most still choose the latter.'

The Path Forward: From Voluntary to Mandatory

The industry is transitioning from voluntary initiatives to mandatory compliance, driven by Extended Producer Responsibility (EPR) laws in states like California and Maine. The Sustainable Packaging Coalition's 2025 Trends Report identifies four key trends shaping sustainable packaging as the industry transitions from 2025 to 2030 commitments.

First, refillable packaging is making a comeback in spirits and beauty sectors, with companies like ecoSPIRITS and Estée Lauder leading initiatives. Second, packaging design is moving away from material-agnostic approaches, with brands like Google and Takeda setting clear material boundaries. Third, material health is becoming central to packaging policy. Fourth, specialized recyclers are filling gaps in municipal recycling systems.

'The era of easy sustainability wins is over,' concludes packaging consultant David Miller. 'What we're seeing now is the hard work of systemic change—retooling supply chains, rebuilding infrastructure, and reshaping consumer expectations. The 2025 goals may be slipping, but the direction is clear: less packaging, better materials, and circular systems.'

As retailers regroup and recalibrate their sustainability strategies, the packaging reduction journey continues—just not on the timeline originally envisioned. The lessons learned from these 2025 challenges will likely shape more realistic and achievable goals for 2030 and beyond.