Contract packaging involves outsourcing packaging related operations to third-party service providers. Contract packaging services include primary packaging, secondary packaging, end-of-line packaging and fulfillment. Contract packaging benefits customers in reducing upfront capital investment and freeing internal resources to focus on core competencies.
The global Contract Packaging Market is estimated to be valued at US$ 66.37 Bn in 2023 and is expected to exhibit a CAGR of 8.0% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Market key trends:
Rising demand from end-use industries like food and beverage, pharmaceuticals, personal care and cosmetics is a key factor driving the growth of the contract packaging market. Growing awareness about using specialized and customized packaging solutions to attract customers is prompting companies to outsource packaging related operations to contract packaging service providers. Contract packaging helps companies to access new technologies and packaging innovations without significant investments. This allows them to strengthen their brand positioning and meet dynamic customer needs. The trend is expected to continue during the forecast period, thereby propelling the contract packaging market.
SWOT Analysis
Strength: The Global contract packaging market Size is highly fragmented with the presence of numerous small and medium-sized players. This makes it difficult for any single player to have a dominating presence.
Weakness: Due to intense competition, the profit margins remain under pressure in the contract packaging market. The market also demands high capital investments for setting up modern packaging facilities.
Opportunity: Growth in industries such as food and beverage, pharmaceuticals, and personal care products drives the demand for contract packaging. Rapid urbanization and rising incomes in emerging economies also create new opportunities.
Threats: Stringent regulations regarding materials usage and environmental hazards pose major challenges. Pricing pressures from global brands can also decrease revenues.
Key Takeaways
The global contract packaging market is expected to witness high growth over the forecast period of 2023 to 2030. The market size is projected to increase from US$ 66.37 billion in 2023 to US$ 123.79 billion by 2030, expanding at a CAGR of 8.0%.
Regional analysis indicates that Asia Pacific dominates the global contract packaging market with China, India and other Southeast Asian countries accounting for over 35% of the overall revenues. This is attributed to the vast consumer base, rapid industrialization and emergence of regional FMCG brands. North America holds the second position while Western Europe is the other major regional market.
Key players operating in the contract packaging include Hindalco Industries Ltd., Arconic Corp., Norsk Hydro ASA, Constellium N.V., Kaiser Aluminum, Alupco, Gulf Extrusions Co. LLC, Balexo Bahrain Aluminium Extrusion Company, and QALEX. These companies are focusing on expanding their production capacities and service offerings to gain bigger shares. Strategic acquisitions and collaborations are on the rise to enhance geographic reach and customer base.
*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it