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Packaging regulations in the United States are entering a new phase. For years, sustainability initiatives often competed with cost, speed, and operational complexity. Packaging teams were asked to reduce waste while keeping fulfillment lines moving and shipping costs under control.
Now expectations are becoming clearer—and more urgent.
When the Plastic Pollution Prevention and Packaging Producer Responsibility Act (SB 54) was signed into law in 2022, California introduced one of the most ambitious packaging frameworks in the United States. The legislation requires companies to significantly reduce plastic packaging, ensure packaging materials are recyclable or compostable, and dramatically increase recycling rates over the next decade.
But the real shift goes beyond regulation.
In conversations with manufacturers, retailers, and distribution leaders across California, the organizations responding most effectively are not treating SB 54 as a compliance exercise. They’re using it as a catalyst to rethink how packaging works within their operations.
Because when you step back, the problem SB 54 is trying to solve isn’t just plastic waste. It’s inefficiency.
Many companies are already addressing these inefficiencies using automated right-sized packaging systems that create custom boxes on demand, reducing both packaging waste and shipping costs.
Oversized boxes. Excess packaging material. Plastic void fill added to compensate for packaging that was never designed for the order in the first place. These inefficiencies add cost, slow fulfillment, and increase environmental impact with every shipment.
Companies that begin addressing these operational bottlenecks often discover something important: improving packaging efficiency can reduce plastic, improve recyclability, and lower shipping costs at the same time.
The conversation around SB 54 shouldn’t start with compliance deadlines. It should start with a more practical question:
What should packaging look like in a modern fulfillment operation?
SB 54 is designed to reduce plastic waste and improve the recyclability of packaging materials sold in California. The law places responsibility on producers, requiring them to design packaging that can move through real recycling systems—not just carry a recyclable label.
By 2032, businesses must meet three primary targets:
Oversight and implementation fall to the California Department of Resources Recycling and Recovery, known as CalRecycle.
For companies selling products in California, these requirements will influence decisions throughout the packaging lifecycle—from material selection to box design to fulfillment processes.
The law also expands the concept of Extended Producer Responsibility (EPR), shifting more accountability to producers for the environmental impact of their packaging.
That means businesses must look beyond packaging procurement and consider whether their packaging can realistically be recycled at scale.
Although the final requirements take effect in 2032, the regulatory framework is rolling out gradually.
The law was signed in 2022, followed by advisory appointments and program development through 2023. In 2024, the state began defining which packaging materials qualify as recyclable or compostable. By 2025, the regulatory framework itself was finalized, and statewide recycling rate reporting began in 2026.
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The performance targets then begin increasing:
While that may seem far away, packaging transformations take time. Changing materials, packaging formats, and fulfillment processes can require significant operational adjustments.
Organizations that start early will have far more flexibility to adapt.
In many fulfillment environments, packaging sits at the center of a tightly integrated operational system.
Stock box sizes are standardized. Packing stations are designed around those dimensions. Warehouse layouts, inventory management systems, and transportation processes all evolve around those assumptions.
Change one part of that system and multiple areas are affected.
For example:
Because of this complexity, packaging decisions often have ripple effects across fulfillment operations.
Companies that start evaluating packaging strategies now have time to adjust processes, test improvements, and implement changes before regulatory deadlines arrive.
One of the most immediate ways companies can reduce plastic packaging is by transitioning to materials that already perform well within existing recycling systems.
Corrugated fiberboard is one of the most widely recycled packaging materials in the United States. Recycling rates exceed 75%, making it one of the most successful material recovery streams in the country.
Plastic packaging tells a very different story. U.S. recycling rates remain below 10%.
That gap highlights a key challenge addressed by SB 54. A material may technically be labeled recyclable, but if infrastructure cannot support large-scale recovery, the environmental benefits remain limited.
Corrugated packaging aligns more closely with the goals of SB 54 because it already moves efficiently through established recycling channels.
For many companies, replacing plastic mailers or plastic packaging components with corrugated materials is an important first step.
But material choice alone doesn’t solve the problem.
Even when recyclable materials are used, inefficiencies in packaging design can still generate unnecessary waste.
Many fulfillment operations rely on a limited set of stock box sizes. When products don’t fit those dimensions, packers fill the extra space with void fill materials.
Often, those fillers are plastic—air pillows, bubble wrap, or foam inserts.
While they help protect products, they also introduce additional plastic into the packaging system and increase the total amount of packaging used for each shipment.
Oversized boxes create two problems at once:
Addressing these inefficiencies requires a different approach to packaging.
Right-sized packaging automation shifts the packaging process from approximation to precision.
Instead of choosing from a limited set of box sizes, automated systems create boxes that match the exact dimensions of each order.
The result is significantly less empty space inside shipments.
When packages are right-sized, the need for void fill drops dramatically—and in many cases disappears entirely. Fewer plastic materials are required to stabilize the product during transit.
Right-sizing also improves product protection. Packages that closely match product dimensions reduce movement during transport, which can lower damage rates.
Operational benefits extend beyond packaging materials.
Smaller packages reduce shipment volume, allowing more orders to fit on each truck. That improved cubic efficiency reduces transportation requirements and lowers overall carbon emissions.
From a regulatory perspective, right-sized packaging supports several SB 54 objectives simultaneously:
What begins as a compliance effort often becomes an operational improvement.
Learn more about how right-sized packaging automation works and how it reduces material waste, shipping costs, and void fill.
For decades, packaging was treated as a procurement decision. Companies sourced boxes and materials in bulk, focusing primarily on cost.
Today’s fulfillment environments reveal a different reality.
Packaging influences shipping rates, warehouse productivity, labor requirements, and sustainability performance. Once organizations start evaluating packaging as an operational system rather than a commodity purchase, new opportunities emerge.
Automated packaging, for example, can deliver improvements across multiple areas.
Lower Material Use
Smaller boxes require less corrugated material and eliminate many void fill materials.
Lower Shipping Costs
Reducing package size lowers dimensional weight charges, which are often the largest cost driver in parcel shipping.
Improved Labor Efficiency
Automation streamlines packing workflows and reduces manual handling steps.
Reduced Environmental Impact
Less packaging material and fewer shipments translate into lower overall emissions across transportation networks.
These benefits extend far beyond regulatory compliance.
California has long played a leading role in environmental policy, and its regulations frequently influence national trends.
Packaging regulations are already expanding beyond California. States including Colorado, Maine, Oregon, and Washington are exploring or implementing their own extended producer responsibility programs. Similar policies are also expanding globally, particularly across Europe and Canada.
Companies operating nationally or internationally may soon face multiple sets of packaging requirements.
Organizations that modernize their packaging systems now will be better positioned to adapt as regulations continue evolving.
SB 54 represents an important step in the evolution of packaging policy in the United States. The law establishes ambitious targets for reducing plastic packaging and improving recyclability, but it also highlights a broader opportunity.
Packaging systems themselves can become more efficient.
Many businesses will combine smarter material choices with more precise packaging processes. Right-sized packaging automation offers a practical path forward by producing boxes that match each order while relying on widely recycled corrugated materials.
The result is less plastic, less wasted space, and more efficient shipping operations.
For companies willing to rethink packaging now, SB 54 becomes more than a regulatory challenge. It becomes an opportunity to build stronger fulfillment operations for the future.
Ready to talk about how your business can take a proactive approach to sustainable and efficient packaging automation? Talk to one of our experts.
