Contract Packaging refers to services concerning the packaging of products for consumers, with the help of associates, who provide several packaging solutions.
Rapid growth in the pharmaceutical industry globally is the key growth driver for the Contract Packaging Market.
Increasing demand for high-quality contract packaging solutions to supply different medical products in large quantities is expected to fuel the growth in the global contract packaging market, in the coming years.
Increasing Need to Ensure Safety of Key Medical Products Could Fuel Contract Packaging Demand in Future
The deployment of contract packaging solutions has ensured greater safety to key medical products. These solutions have been found to meet the government regulations, concerning the sale of the product. These factors could help increase the demand for contract packaging solutions, in the years ahead.
In the last few years, a trend witnessed in the contract packaging market is that these solutions have evolved from being a quick fix to becoming strategically important to companies. Leading contract packers have shown a greater involvement in key supply chain decisions such as the selection of vendors and also been in the product development process and quality assurance processes.
Contract packers are also shifting towards new, innovative ways to package different products. This increased involvement of contract packers in the key decision-making process could contribute to the growth of the contract packaging market, in future.
Growth and development in the online distribution channel to supply pharmaceutical and cosmetic products could play a key role in the overall growth in the contract packaging market, in the coming years.
Advancements to existing contract packaging solutions could fuel the demand and propel the global contract packaging market, in future.
Other factors such as rapid industrialization, especially in developing economies such as India and rising disposable income could help bolster the contract packaging market, in the years ahead.
Some of the commonly-deployed contract packaging solutions include labeling, cartooning, and bottling and filling.
COVID-19 Pandemic Positively Impacts Growth in Contract Packaging Market
The future for the contract packaging market seemed optimistic and it was given a further impetus by the outbreak of the COVID-19 pandemic.
With growing number of patients suffering from the virus globally, the demand for different medical equipment storage products such as boxes & cartons, ampoules, sachets and stick packs, and blisters and clamshells witnessed a significant increase. This helped in the growth of the global contract packaging market.
During the post-pandemic phase, it is anticipated that leading fast moving consumer goods market players would continue to work to meet the consumer requirements by deploying contact packaging solutions since many of these players do not have their own exclusive packaging facilities. This could fuel the growth in the overall contact packaging market, too.
While contract packaging solutions have proven beneficial to a number of industries, there are drawbacks to them that could impact demand in future.
High Raw Material Costs, Strict Government Regulations Could Dent the Growth in the Global Contract Packaging Market in Future
Contract packaging solutions have proven to incur high raw material costs, which could be a key restraining factor to the growth of the overall market growth, in future.
Leading contract packaging market players extensively deploy plastics to supply products. With governments in leading economies imposing stringent regulations against the use of plastic, manufacturers could be restricted from deploying plastic contract packaging solutions, which could dent the growth in the overall market.
Also, as market players in different industries continue to grow they could look to establish their own, in-house packaging facilities, which could decrease the demand for services from third-party vendors, in turn limiting the growth in the global contract packaging market.
R&D undertakings to produce improved quality of products could be a key growth strategy for leading market players in future.