Contract Packaging Market

Market Overview:

The global contract packaging market size reached USD 73.0 Billion in 2024. Looking forward, IMARC Group expects the market to reach USD 140.2 Billion by 2033, exhibiting a growth rate (CAGR) of 6.75% during 2025-2033. The growing number of e-commerce brands, increasing utilization of sustainable packaging, and rising integration of artificial intelligence (AI) and the Internet of Things (IoT) for streamlining processes and making packaging operations more efficient are some of the major factors propelling the market.

Contract packaging refers to the procedure of outsourcing the packaging of products to specialized third-party companies known as contract packagers or co-packers. It encompasses packing, shipping, and distribution aspects, often involving palletizing and shrink-wrapping for bulk transportation. It is essential for businesses that are dealing with seasonal products during peak periods to meet increased demand without investing in permanent infrastructure. It enables companies to save on packaging costs by outsourcing to contract packagers who benefit from economies of scale and expertise. It also allows companies to create attractive promotional packaging for limited time offers or events.

At present, the increasing demand for contract packaging, as it can quickly adapt to changing packaging requirements and is useful for product variations or updates, is impelling the growth of the market. Besides this, the rising utilization of contract packaging, as it leads to quicker turnaround times, enabling faster market entry for new products, is propelling the growth of the market. In addition, the growing popularity of contract packaging as contract packagers have robust quality control processes, ensuring the consistency and reliability of packaging is offering a favorable market outlook. Apart from this, the increasing outsourcing of packaging activities to minimize errors and save time is supporting the growth of the market. Additionally, the rising integration of artificial intelligence (AI) and the Internet of Things (IoT) for streamlining processes, enhancing accuracy, boosting productivity, and making packaging operations more efficient and cost-effective is strengthening the growth of the market.

Contract Packaging Market Trends/Drivers:

Rising number of e-commerce brands

At present, there is an increase in the number of e-commerce brands selling products online and delivering them to the doorstep of buyers. Additionally, the widespread utilization of smartphones and other mobile devices has made online shopping more accessible than ever, allowing consumers to browse and purchase products on the go. This increased connectivity is expanding the potential customer base for e-commerce brands, reaching individuals in both urban and remote areas. Moreover, advancements in secure payment gateways and improved online security are instilling greater confidence in consumers to conduct financial transactions online and boosting the e-commerce industry. Furthermore, the increasing number of e-commerce brands is positively influencing the demand for contract packaging around the world.

Increasing utilization of sustainable packaging

As consumers become more environmentally conscious, there is a rising demand for sustainable and eco-friendly packaging options. Many brands are actively seeking contract packaging companies that offer sustainable packaging solutions to align with their environmental commitments. This increasing demand for sustainable packaging is creating new opportunities for contract packagers to expand their service offerings and cater to a broader client base. Sustainable packaging allows brands to differentiate themselves in a competitive market by showcasing their commitment to environmental stewardship. Companies that partner with contract packagers offering sustainable options that is enhancing their brand reputation and appealing to environmentally conscious consumers, leading to increased brand loyalty and positive word-of-mouth marketing.

Growing demand for customization and personalization

The demand for customization and personalization is leading contract packagers to diversify their service offerings. They are equipped to handle a wide range of product variations, packaging designs, and labeling requirements. This expanded capability allows brands to offer personalized packaging options to their customers without having to invest heavily in in-house packaging facilities. Moreover, customized packaging helps brands stand out in a crowded marketplace. Contract packagers that can provide unique packaging solutions contribute to enhancing brand differentiation for their clients. Customized and personalized packaging is creating a more engaging and memorable experience for consumers. When products are tailored to individual preferences or occasions, customers feel a stronger emotional connection to the brand. This heightened engagement is leading to increased customer satisfaction and repeat purchases.

Contract Packaging Industry Segmentation:

IMARC Group provides an analysis of the key trends in each segment of the global contract packaging market report, along with forecasts at the global, regional and country levels from 2025-2033. Our report has categorized the market based on packaging type, material, service and end use industry.

Breakup by Packaging Type:

• Primary
• Secondary
• Tertiary
   

Primary dominates the market

The report has provided a detailed breakup and analysis of the market based on the packaging type. This includes primary, secondary, and tertiary. According to the report, primary represented the largest segment.

Primary contract packaging refers to the outsourcing of the packaging and assembly of the primary packaging of the components of a product to a third-party contract packaging company. The primary packaging is the layer of packaging that directly contains and protects the product. It is the packaging that comes into direct contact with the product and is usually the first layer of packaging that the end consumer interacts with. Primary contract packaging services are utilized by companies that may not have the necessary facilities, equipment, or expertise to handle the packaging of their products in-house. Outsourcing primary packaging allows companies to focus on their core competencies while relying on specialized contract packagers to handle the packaging and assembly efficiently.

Breakup by Material:

• Plastic
• Metal
• Glass
• Paper and Paperboard
   

Plastic holds the largest share of the market

A detailed breakup and analysis of the market based on the material have also been provided in the report. This includes plastic, metal, glass, and paper and paperboard. According to the report, plastic accounted for the largest market share.

Plastic materials come in various forms, such as polyethylene (PE), polypropylene (PP), polyethylene terephthalate (PET), polyvinyl chloride (PVC), and many others. Each type of plastic offers unique properties that make it suitable for different packaging applications. This versatility allows contract packagers to choose the most appropriate plastic material for a wide range of products. Plastic is also lightweight compared to other packaging materials, such as glass or metal. This characteristic reduces shipping costs and makes handling and transportation more manageable for both contract packagers and end consumers. Plastic packaging provides a high level of durability and protection for products. It can resist impact, moisture, and other environmental factors, safeguarding the product during transit and storage.

Breakup by Service:

• Bottling
• Bagging/Pouching
• Lot/Batch and Date Coding
• Boxing and Cartoning
• Wrapping and Bund
• Labelling
• Clamshell and Blister
• Others
   

Bottling holds the biggest share of the market

A detailed breakup and analysis of the market based on the service have also been provided in the report. This includes bottling, bagging/pouching, lot/batch and date coding, boxing and cartooning, wrapping and bund, labeling, clamshell and blister, and others. According to the report, bottling accounted for the largest market share.

Contract bottling services involve outsourcing the filling, capping, and labeling of liquid products into bottles to specialized packaging companies. Contract packagers that offer bottling services are equipped with specialized knowledge, skills, and equipment for efficiently handling the bottling process. They have experience in handling different types of liquids and bottles, ensuring that the filling process is precise and consistent. Besides this, setting up an in-house bottling facility can be a significant investment for brand owners, requiring capital expenditure for machinery, training, and maintenance. Contract bottling allows brands to avoid these upfront costs and opt for a more cost-effective solution by outsourcing to experienced packagers who already have the necessary infrastructure in place.

Breakup by End Use Industry:

• Food and Beverage
• Pharmaceutical
• Electronics
• Personal Care
• Others
   

Food and beverage hold the maximum share of the market

A detailed breakup and analysis of the market based on the end use industry have also been provided in the report. This includes food and beverage, pharmaceutical, electronics, personal care, and others. According to the report, food and beverage accounted for the largest market share.

Contract packaging allows food and beverage companies to reduce operational costs significantly. Setting up an in-house packaging facility involves substantial investments in machinery, equipment, labor, and maintenance. By outsourcing packaging to contract packagers, companies can avoid these upfront costs and benefit from economies of scale achieved by specialized packaging companies. The food and beverage industry often experiences fluctuations in demand due to seasonality, promotions, or product launches. Contract packaging provides the flexibility to adjust production volumes based on market demands. Companies can spontaneously scale up or down their packaging requirements without having to manage excess capacity during slow periods. Contract packaging companies specialize in packaging and have extensive expertise in handling various food and beverage products. They employ efficient packaging processes and advanced machinery to ensure precise and consistent packaging, reducing the risk of errors and product defects.

Breakup by Region:

• North America
  • United States
  • Canada
• Asia Pacific
  • China
  • Japan
  • India
  • South Korea
  • Australia
  • Indonesia
  • Others
• Europe
  • Germany
  • France
  • United Kingdom
  • Italy
  • Spain
  • Russia
  • Others
• Latin America
  • Brazil
  • Mexico
  • Others
• Middle East and Africa
   

North America exhibits a clear dominance, accounting for the largest contract packaging market share

The report has also provided a comprehensive analysis of all the major regional markets, which include North America (the United States and Canada); Asia Pacific (China, Japan, India, South Korea, Australia, Indonesia, and others); Europe (Germany, France, the United Kingdom, Italy, Spain, Russia, and others); Latin America (Brazil, Mexico, and others); and the Middle East and Africa. According to the report, North America represented the largest market.

North America held the biggest market share due to the rising focus on outsourcing various operations among businesses to reduce labor costs and eliminate the requirement of investing in in-house facilities.

Apart from this, the rising consumption of various convenient and packaged food and beverage items is supporting the growth of the market. In addition, the increasing demand for eco-friendly packaging in various sectors is contributing to the growth of the market.

Asia Pacific is estimated to expand further in this domain due to the rising number of e-commerce brands selling products online. Besides this, the increasing focus on maintaining product quality among the brands is bolstering the growth of the market.

Competitive Landscape:

Key market players are investing in state-of-the-art technology and automation to enhance packaging efficiency, accuracy, and speed. They are also planning to reduce human errors, increase production capacity, and generate quicker turnaround times, enabling them to handle larger volumes and meet client demands effectively. Top companies are diversifying into new packaging formats, such as flexible pouches, sustainable packaging solutions, or specialized packaging for specific industries like pharmaceuticals or cosmetics. They are also adopting sustainable packaging practices to align with the increasing demand for eco-friendly solutions. Leading companies are collaborating closely with clients to create unique and personalized packaging designs that help brands stand out in the market and create a strong brand identity.

The report has provided a comprehensive analysis of the competitive landscape in the market. Detailed profiles of all major companies have also been provided. Some of the key players in the market include:

• Aaron Thomas Company Inc.
• AmeriPac
• Assemblies Unlimited Inc.
• Co-Pak Packaging Corporation
• Hollingsworth
• Kelly Products Incorporated
• Marsden Packaging Ltd.
• Multi-Pack Solutions LLC
• Reed-Lane. Inc.
• Sonic Packaging Industries Inc.
• Sterling Contract Packaging Inc.
• Unicep Packaging LLC (Silgan Holdings Inc.)
   

Recent Developments:

• In October 2021, Silgan Holdings Inc. announced the acquisition of Easytech Closures S.p.A that will allow effective and efficient utilization of existing capacity for metal ends used with metal containers primarily for food applications.
• In 2022, Hollingsworth announced the opening of its third facility in Columbus, Ohio region, which will support its growing fulfillment, packaging, and kitting services and expand their customer base.
   

Contract Packaging Market Report Scope:

Key Benefits for Stakeholders:

• IMARC’s report offers a comprehensive quantitative analysis of various market segments, historical and current market trends, market forecasts, and dynamics of the contract packaging market from 2019-2033.
• The research study provides the latest information on the market drivers, challenges, and opportunities in the global contract packaging market.
• The study maps the leading, as well as the fastest-growing, regional markets. It further enables stakeholders to identify the key country-level markets within each region.
• Porter's five forces analysis assists stakeholders in assessing the impact of new entrants, competitive rivalry, supplier power, buyer power, and the threat of substitution. It helps stakeholders to analyze the level of competition within the contract packaging industry and its attractiveness.
• Competitive landscape allows stakeholders to understand their competitive environment and provides an insight into the current positions of key players in the market.