Published Date : 21 Mar 2024
The global contract packaging market size surpassed USD 80.3 billion in 2023 and is estimated to attain around USD 160.52 billion by 2032, growing at a CAGR of 8% from 2023 to 2032.
The contract packaging market deals with outsourcing the packaging and collecting of products to limited third-party service suppliers. They manufacture the products, store them in a warehouse, and then distribute them. This arrangement permits the industry to focus on its important capabilities while using the resources and expertise of packaging service suppliers. Distributing packaging functions permits industries to decrease capital investments in facilities and machinery and take advantage of economies of scale achieved by the industries.
Contract packaging service suppliers offer the experts to design and implement customized packaging strategies that fulfill evolving customers' needs. Moreover, the globalization of supply chains has created a strong demand for contract packaging solutions that comply with necessary demands and country preferences for packaging or type. Further, is driving the requirement for outsourcing of contract packaging services.
North America dominated the contract packaging market in 2023. The contract packaging industry in North America is rapidly growing because of the enlarged interest in packaging in enterprises such as the excellence of care, drugs, food, beverages, and others. A few contract packaging companies in the United States and Canada have solved how to adjust to problematic business conditions. Companies are likewise becoming more conscious of the enraged worldwide competition, fluctuating OEM requests, and cost difficulties.
The contract packaging industry in the United States is expanding quickly because of this environment. The contract packaging industry in the United States is expected to grow consistently because of market solidity, developing interest, and a change in gathering endeavors tendency for contract package makers. In addition, the United States government has ordered various regulations and guidelines managing medication marking and packaging. Since few drug companies in this region have an in-house packaging plant, this could impact interest in the market.
Europe is estimated to grow fastest in the forecast period. Europe is expected to experience constant growth in the coming years. The region’s dominance is described by a diverse and grown-up contract packaging industry. A strong impact on compliance, innovation, creativity, and sustainability, along with strict environmental regulations, is also driving the European contract packaging market.
| Report Coverage | Details |
| Market Revenue in 2023 | USD 80.3 Billion |
| Projected Forecast Revenue by 2032 | USD 160.52 Billion |
| Growth Rate from 2023 to 2032 | CAGR of 8% |
| Largest Market | North America |
| Base Year | 2023 |
| Forecast Period | 2023 to 2032 |
| Regions Covered | North America, Europe, Asia-Pacific, Latin America, and Middle East & Africa |
Drivers
The rise of e-commerce
E-commerce platforms create significant opportunities for contract packagers. As online shopping increases, there is a high demand for cost-effective packaging solutions. Contract packaging makers can satisfy this demand by offering everything from product containers to shipping boxes. E-commerce platform ensures safe and speedy delivery for the driving online retail market. These major opportunities will drive the contract packaging market growth in the coming years.
Increased outsourcing of packaging services
Across various industries, the constant increase in outsourcing trends among companies is the main driver of the market. Businesses recognize the strategic profit of outsourcing their packaging demands to specialized contract packaging service suppliers. Factors such as the capacity to focus on core capabilities, access to specialized packaging expertise, and the desire for cost optimization are driving the trend.
Outsourcing packaging functions permits industries to take advantage of the specialized knowledge and capabilities of packaging service suppliers. These suppliers are equipped with a deep understanding of industry-leading practices, the latest technologies, and the diverse packaging demands of different regions. Outsourcing packaging processes are becoming an attractive option due to industries seeking to distribute resources and streamline their operations more perfectly. Such exclusive advantages of packaging service will drive the growth of the contract packaging market.
Restraint
Stringent regulatory demands
The market is crucially affected by the strict regulatory demands imposed on various companies, mainly healthcare, pharmaceuticals, and food & beverages. Regulatory obedience and quality assurance are crucial factors in modeling the landscape of packaging services. Packaging service suppliers must illustrate a healthy commitment to regulatory obedience, impacting the cost of operation and overall product margins. These major factors may restrain the contract packaging market in the coming years.
Opportunity
Increasing demand for customization of packaging
The increasing demand for product customization is an important driver of the market. Today, customers are searching for unique and personalized products, like interactive packaging, and this trend has a direct effect on packaging demands. Contract packaging solution suppliers are increasingly delivering specialized packaging solutions that range from separate brand identities to customer preferences and product variations.
Customization expands beyond the traditional branding items to involve materials, sizes, and customized packaging. Contract packaging includes features like unique packaging, attractive package designs, and personalized labeling. The increasing demand for e-commerce has fueled the requirement for customization by raising the adoption of such packaging.
Market Segmentation
By Type
By Material
By Service
By End User
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