Contract Packaging Market is predicted to reach USD 59088.3 million at a CAGR of 6.5% during the forecast period

Pune, India, Oct 2022, MRFR Press Release/Market Research Future has published a Cooked Research Report on the Global Contract Packaging Market.

Global Contract Packaging Market

Contract packaging is a common phenomenon of outsourcing of packaging operations to the contract packaging partner that has expertise in the overall packaging supply chain. Contract packaging manufacturers offer a range of packaging services such as bagging/pouching, lot/batch & date coding, boxing & cartoning, wrapping & bundling, labelling and others. Outsourcing of packaging operations to contract packaging companies saves significant financials of the companies as it negates the purchasing of expensive packaging machinery and materials.

Market Synopsis

According to the MRFR analysis, the global Contract Packaging market size is projected to reach USD 59088.3million by 2030 at a CAGR of 6.5%.

Contract packaging is the process in which any organization gives a contract or hire another company to manage and maintain their packaging needs and supply chain needs. The overall contract packaging process may include various stages such as assembling the packaging of the finished product. Rising manufacturing output from the range of end use industries is one of the vital factors that bolster the demand for the contract packaging among the brand owners. Owing to the market disruption caused by the pandemic, the current projections of global contract packaging market growth till 2030 are expected to be slightly lower than pre-COVID-19 estimates. The pandemic has had a negative impact on the contract packaging industry across the globe. The emergence of the pandemic globally has induced a decline in the demand for contract packaging due to the shutdown or functioning of manufacturing facilities at partial capacities and a slowdown in the supply of components and raw materials due to the lockdown restrictions. Contract packagers have witnessed a decline in the demand for packaging as the market has declined in demand for food & beverage, pharmaceuticals, personal care, consumer goods, spare parts, e-commerce, and other industry.

Competitive Landscape

The global contract packaging market is characterized by the presence of many global, regional, and local vendors. The market is highly competitive, with all the players continually competing to gain a larger market share. High competition and rapid advancements in technology are some of the critical factors that could restrain market growth. The vendors compete based on cost, product quality, and reliability. It is crucial for vendors to provide cost-effective and efficient products to survive and succeed in a competitive market environment.

WestRock, GXO, CEVA Logistics, Sonoco, FedEx, DB Schenker, UPS, Kuehne + Nagel Logistics, DSV, Geodis, Menasha, Solistica, IPS, Hopi, Marvinpack, Truvant are the major players in the market.

Segmentation:

Based on Service:

• Bagging/Pouching: Multi-bagging is a very efficient and affordable way to pack. The multi-bagging or vertical bagging machines build plastic bags out of a flat roll of film based on weight, fill the bag with the above products, and seal it all simultaneously. Labelings are travel and sample size packaging solutions for consumers on the go jones high-speed tablet pouching machines are perfect for high-volume production projects since they can handle run sizes of more than two million pouches.


• Lot/Batch & Date Coding: The handheld printer can print on non-porous surfaces like glass, metal, or plastic, including irregular and curved surfaces, thanks to the combination of quick drying ink and small spray inkjets. Printing lot and batch numbers on items like jars, cans, metal components, plastic bags, coated cardboard, aluminum foil, and more are excellent using this method. Nowadays, shipping, packing, security, loss prevention, manufacturing, administration, and logistics all employ handheld printers.


• Boxing & Cartoning: Vertical bagging and boxing system integrate bag forming, product weighing and loading, bag sealing, case forming and loading, and case sealing into one fully automated system, significantly lowering labor costs and increasing throughput. Increase packing rates in boxing, lower material prices, and lower labor costs with a specially created high-speed packaging line. Custom bagging, boxes, and crate solutions, palletizing, heat sealing, foam wrapping, and shrink wrapping, are available options in addition to military packaging.


• Wrapping & Bundling: It is anticipated that packaging will protect the object throughout transit and storage. Every specific item includes packaging as a vital component. However, item bundling necessitates a tremendous amount of resources and initial investments. Manufacturers use outside bundling companies, also called contract bundling companies, to package their products to overcome this problem. Additionally, contract bundling provides bundling expertise and resources.


• Labeling: The bottles offer more transparency than other packaging options. They continue to be consumers' favorite choices. This suggests that companies in the contract packaging sector should concentrate more on providing bottling services. However, end users demand specific labeling on their products since labeling becomes an essential marketing tool to provide consumers with accurate brand information. Additionally, organizations are becoming more conscious of the intense global competition, cost concerns, and shifting OEM demand.


• Others: The other segment comprises of one of the vital packaging solutions such as trays, crates, pallets and others which are predominantly used in both industrial and non-industrial applications. Rising demand for these robust yet reusable secondary packaging solutions led manufacturers to maximize the production of these packaging solutions to cater the ongoing demand generation from various end use industries such as food and beverages, pharmaceuticals, automotive and others.

Based on End-Use Industry:

• Food and beverages: The food industry is evolving into a profitable to target for labeling and other contract packaging services as people start reading the labels on food products and beverages. However, the current increase in cosmetics sales online is anticipated to provide the labeling industry with chances for long-term growth. The food & beverage sector is the largest end-use industry for contract packaging worldwide.


• Consumer goods: In contrast to intermediate goods, which are used to create other things, a consumer good is a finished product that is ready for sale and is used by the customer to satisfy current wants or requirements. From one-ounce bottles to 275-gallon totes, a wide range of packaging options are available for consumer goods. Additionally, the consumer will have complete control over the cap size, color, style, and labeling. Contract packaging is a service offered by companies with expertise in product packaging. Manufacturers of consumer goods frequently contract out the packaging of their products to co-packers or contract packagers.


• Personal care: The materials used to package personal care products to shield them from contamination and other harm are known as personal care packaging. Plastic, flexible packaging, paperboard, glass, and metals are a few of these materials. As the demand for organic components rises, consumers across the sector are shifting toward organic skin care products, which is expected to fuel market expansion over the forecast period. The market is growing due to heightened public awareness of the negative effects of synthetic materials and chemicals.


• Pharmaceutical: The use of medical tools, sachets, stick packs, boxes, cartons, blisters, clamshells, vials, and ampoules, increased worldwide. The contract packaging market is seeing growth due to the rising use of medical equipment in the healthcare industry. Contract packaging firms must comply with government norms and regulations regarding pharmaceutical products. The contract packaging businesses must be equipped with the necessary infrastructure and expertise to carry out these tasks.


• E-commerce: Due to economic and social distance rules, which have caused a surge in the e-commerce market, most consumers have favored online buying channels. To keep up with the rising demand, businesses have outsourced their packaging end to end or as separate services. Since the delivery cost is already included, package inserts are a low-cost strategy to target repeat consumers and can produce significant returns.


• Spare Parts: To guarantee that the spare parts are delivered undamaged and able to be properly unloaded and stored, the spare parts and documentation must be carefully packaged, tagged, protected, and dispatched by this document. To make re-assembly on site easier, large spare parts that must be disassembled before shipping must be properly match-marked before disassembly. All spare parts that could become loose during transport, especially large ones like current and voltage transformers, circuit breakers, and block resistors, must be taken out and packaged separately to avoid vibration that could cause damage to the part in a question and/or other components.


• Others: Others are tobacco, stationery, household goods, consumer electronics, apparel, and toiletries. Technical requirements for combined health warnings on tobacco products are one of them. It gives a rundown of the tasks completed by the contract, including the approaches used, any issues or restrictions found, and suggested fixes. The goal of this work package was to give a typical sample of the various types and sizes of smoked tobacco products permitted in Europe under the TPD regulations while also considering the minimum warning sizes and packaging appearance requirements.

Based on region:

• North America: Due to the high-quality service offerings provided by CPOs and CDMOs based in the US, North America accounted for the significant revenue share in 2021. Additionally, most pharmaceutical businesses contract out their wrapping tasks to North American packages to make entering the US markets easier. Nearly 50 well-known, often prescribed medications are anticipated to lose their patent protection in North America by the end of 2020, which presents the potential for contract packagers. A higher hospital stay rate and a worsening illness can result from poor patient compliance or drug adherence.


• EMEA: The contract packaging market in South America is moderately fragmented. The market is crowded with powerful competitors. Some of these significant entities presently control the market regarding market share. These powerful firms focus on growing their clientele internationally. These companies use strategic, coordinated measures to increase their market share and profitability. In South America, Brazil receives the majority of foreign direct investments and is quickly becoming a major hub for pharmaceutical contract manufacturing. Brazil had the second-largest market share for pharmaceutical contract manufacturing in this region. European enterprises are increasingly outsourcing their packaging requirements to contract packaging companies to focus on their core operations and cut operating expenses while growing market penetration. Due to rising demand and a shift in manufacturing companies' preferences toward contract packagers, the European contract packaging market has experienced significant growth in recent years. The Middle East & Africa has grown in contract packaging services, particularly bottling and filling services. Due to the increasing demand for food, beverage, and pharmaceuticals during the COVID epidemic, many businesses outsourced their packaging for greater safety due to the demand for contract packaging.


• Asia-Pacific: Numerous regional contract packaging service providers are expected to fuel the growth of the Asia-Pacific market during the projection period. These players are concentrating on expanding their facilities to meet the increased demands of pharmaceutical businesses. The industry in the region is also expanding due to the growing outsourcing of pharmaceutical manufacturing to developing nations like India. In 2021, Asia-Pacific accounted for the substantial share of the market for contract packaging, and it is projected that this trend will continue during the forecast period. The increased demand in this region's consumer goods and food & beverage sector is the reason for this.


• South America: The contract packaging market in South America is moderately fragmented. The market is crowded with powerful competitors. Some of these significant entities presently control the market regarding market share. These powerful firms focus on growing their clientele internationally. These companies use strategic, coordinated measures to increase their market share and profitability. In South America, Brazil receives the majority of foreign direct investments and is quickly becoming a major hub for pharmaceutical contract manufacturing. Brazil had the second-largest market share for pharmaceutical contract manufacturing in this region.