Contract Packaging Market Analysis & Forecast: 2025-2032

Contract Packaging Market is estimated to be valued at USD 79.87 Bn in 2025 and is expected to reach USD 152.7 Bn in 2032, exhibiting a compound annual growth rate (CAGR) of 9.7% from 2025 to 2032.

Contract packaging is the service that the companies provide to the manufacturing companies. The packaging of a product is necessary to store it.The packaging of products requires labor, machinery, and which are more expensive and time-consuming. Therefore, manufacturers hire packaging companies to avoid these problems and concentrate on their core operations. Co-packers, also known as contract packers, provide structural design and testing, print and graphic services, and production labor. In some cases, the contract packers may even provide full service fulfilment. The contract packers can specialize in the packaging of specific consumer products such as electronic, automotive, food and beverages, pharmaceutical, and personal care products.

Global Contract Packaging Market - Impact of Coronavirus (COVID-19) Pandemic

With the outbreak of the COVID-19 pandemic, the contract packaging market has witnessed tremendous growth, as the e-commerce market has taken a boom, due to lockdown and social distancing norms where the majority of the consumers has been preferring online channel for shopping, and companies have been outsourcing their packaging end to end or standalone services to meet the growing demand

Global Contract Packaging Market: Growth Drivers

• Growing demand from the e-commerce industry: The growth of the e-commerce sector has also increased the need for tertiary packaging globally; thus, the contract packaging market is expected to grow. Other packaging intensive industries, such as pharmaceuticals, consumer goods and food & beverages, and electronics, are also experiencing a surge in demand due to various factors, such as increasing disposable income, a growing population, and favorable government policies, towards business in many countries. The growth of the above industries is expected to positively impact the contract packaging market growth. The government of India has launched Production Linked Incentive (PLI) scheme in 2021 for different industries, which is expected to drive the contract packaging market during the forecast period.
• Growing popularity of innovative packaging solutions: The packaging industry is growing at a fast pace. New products and technologies are being introduced all the time. Packaging companies need to keep up with the ever-evolving needs of their customers. New trends in the packaging market are driven by urbanization, rising disposable income, and the need for convenient and easily open packages. In the last few years, there have been many innovations in packaging technology including smart packaging, antimicrobial packaging, water-soluble packaging, and corn starch based packaging. These innovations in packaging media are low-carbon, eco-friendly, and sustainable and are expected to offer lucrative growth opportunities to contract packaging firms in the coming years. For instance, companies can avoid the cost of setting up a production facility, packaging equipment, staff training, and purchasing materials, by outsourcing to a contract packager. The European Co-packers Association stated that adopting the strategy to choose for contract packaging solution can save the company up to 7% to 9% of the cost incurred in its complete production cycle.

Global Contract Packaging Market: Market Restraints

• Competition from in-house packaging: Competition from in-house packaging can have a number of effects on the global contract packaging market. First, companies that decide to handle packaging internally may decrease their reliance on in-house contract packaging services. This could result in a decrease in the demand for in-house providers. Second, companies that handle packaging internally have more control over the overall packaging process. This can lead to increased efficiency and lower costs. Third, companies may see in house packaging as a means to protect their valuable information and retain control over the design and branding of their packaging. Contract packaging providers can offset this competition by providing specialized expertise and flexibility that in-house providers may not be able to provide. Fourth, they can develop strategic partnerships that allow them to provide custom packaging solutions that in-house cannot replicate. All in all, competition from in-house packaging presents challenges, but contract packaging can continue to grow by providing unique value propositions for companies looking for specialized packaging solutions.
• Strict regulations regarding packaging materials: Strict regulations regarding packaging materials can have a negative impact on the global contract packaging market. These strict regulations can increase the compliance cost of packaging companies. For example, strict regulations may mandate that packaging materials meet specific environmental or safety standards. This can lead to additional compliance testing costs and material sourcing expenses for packaging companies. Strict regulations may also restrict the market by limiting the range of options available for packaging solutions. For instance, strict regulations may limit the range of approved packaging materials. On the other hand, strict regulations can have a positive effect on the global contract packaging market. Regulations on packaging material can encourage innovation in the industry. Companies can develop new, eco-friendly, and sustainable packaging solutions to meet the requirements of the regulations. It also creates a level playing field by ensuring that all packaging companies meet the same standards. This can increase consumer confidence and trust in the market.

Market Trends

Consumers are increasingly concerned about the impact of packaging materials on the environment

Consumers are increasingly concerned about the impact of packaging materials on the environment. As a result, companies are looking for contract packaging services that offer eco-friendly options. Governments and regulatory bodies are encouraging sustainable packaging practices through different initiatives and regulations. Market players are investing in eco-friendly packaging technologies and materials to meet the increasing demand.

Global Contract Packaging Market: Market Segmentation

By type, the market is categorized into primary, secondary, and tertiary. On the basis of packaging, in 2025, primary held the largest revenue share of 503% in the global contract packaging market. One of the reasons for this is the growing need for specialized packaging & labeling that meets strict regulatory requirements. Another reason is that outsourcing non-core activities enables pharmaceutical companies to concentrate on R&D, which, in turn, increases the need for efficient & safe packaging solutions for pharma products.

Figure 1: Global Contract Packaging Market Value Share (%), By Packaging, 2025

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Global Contract Packaging Market: Regional Analysis

Among regions, North America held the dominant position in the global contract packaging market in 2025, accounting for 35% shares in terms of volume, followed by Europe and Asia Pacific, respectively.

• North America: North America accounts for the largest share of the global contract packaging market. This is due to the increased industrialization and the large number of players involved in the market.
• Europe: Europe is a major contributor to the overall contract packaging market. It is mainly due to the high demand for packaged food and beverages, and pharmaceuticals.
• Asia Pacific: Asia Pacific is the fastest growing region in the world due to the rising per capita income and the growing population.

Regional governments are supporting marginal, small, and medium-sized industries, which is leading to rapid industrialization and urbanization.

Figure 2: Global Contract Packaging Market Value Share (%), By Packaging, 2025

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Global Contract Packaging Market: Key Developments

• In April 2022, Tjoapack, an international contract packaging organization, its production capacity by increasing the size of its facility located in the Netherlands to 11,500 square meters from 8,400 square meters
• In May 2021, Sharp Services LLC, a U.S.-based global leader engaged in contract packaging and clinical supply services, purchased new land for its capacity expansion at the Conshohocken campus. The move is part of a US$ 17 million investment at the Conshohocken. It will help the company to significantly increase its capacity to meet the increasing demand for its services.

Global Contract Packaging Market: Key Companies

Aaron Thomas Company, Multipack Solutions, Pharma Tech Industries, Reed-Lane Inc., Sharp Packaging Services, UNICEP Packaging, Green Packaging Asia, Jones Packaging Inc., Stamar Packaging, Budelpack Poortvliet BV, and Complete Co-Packing Services Ltd

*Definition: The contract packaging market is a market where packaging activities are outsourced to third-party packaging companies. These companies are called contract packagers and offer packaging services like labeling, assembly, packaging design, and others. The contract packaging market  is fueled by the need for packaging companies to simplify their packaging processes, lower costs, and increase overall productivity. Contract packaging enables companies to focus on core competencies while providing quality packaging solutions.