Does green packaging matter in production cost reduction?

Abstract

Purpose. This study empirically investigates the relationship between green packaging and the reduction of companies' costs, and maximizing financial returns to improve manufacturing processes. and helps MSMEs reduce their costs through green packaging.

Design/methodology/approach. The study sample consisted of 450 MSMEs manufactured in Gaza using random sampling technique. Hypotheses were examined by A t-test and regression model.

Findings. The study found a positive impact of the use of green packaging on the cost of products in manufacturing MSME in Gaza. However, manufacturing MSMEs in Gaza, Palestine, is not concerned with the use of green packaging in their products to attract customers, where it does not affect the increase in sales volume, and doesn't give them a competitive advantage despite its advantages in protection the Products.

Research limitations/implications. This study is focused on manufacturing MSMEs in Gaza. And highlights the cost-related challenges and benefits of green packaging for manufacturing MSMEs.

Recommendation. The study recommended the necessity of using green costing techniques that attempt to factor environmental costs into the financial results of operations instead of traditional costing system. The study also underscored the need to provide incentives for businesses to adopt green packaging, such as tax breaks or reduced tariffs on eco-friendly materials.

Originality/value. the study highlights the importance of green packaging in reducing manufacturing costs through material efficiency, waste reduction, and power savings, as well as supplying environmental benefits.