Packaging and Labeling Services NAICS 561910
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Industry Summary
The 1,600 contract packaging establishments in the US generate revenue by charging fees (or a "toll") for packaging customer products in finished form. Turnkey packaging refers to projects in which the contract packager purchases inventory for the customer and takes responsibility for final packaging services. Firms may also generate revenue through telemarketing services or the resale of merchandise.
Unpredictable Work Flow From Customers
Demand for contract packaging firms can be extremely unpredictable.
Capital-Intensive Operations
Packaging operations require significant investments in plants, equipment and machinery.
Recent Developments
Nov 26, 2025 - Store Brands Grow Faster than National Brands
- Private labels are gaining ground in the retail market, as store brands outpace national brands, according to Packaging Dive. At the Private Label Manufacturers Association trade show, speakers emphasized that packaging companies play a central role in this expansion, with shelf-ready packaging driving efficiency and enhancing consumer appeal. In the first 11 months of 2025, store brand unit sales increased 0.4%, while national brands declined 0.7%, according to market research firm Circana. Over the same period, dollar sales of store brands rose 3.6%, while national brands grew just 1.1%. Packaging manufacturers are seizing opportunities by partnering with private label producers and co-packers, showcasing innovations such as flexible pouches, fiber-based tubs, compostable lids, and child-resistant caps. As shoppers trade down to store brands amid economic uncertainty, packaging services are becoming a critical differentiator, enabling private labels to compete on quality, innovation, and value.
- The global packaging market is valued at $1.2 trillion and is projected to grow at a compound annual rate of 3.5% through 2030, according to market research firm Smithers. Markets in North America, Europe, and Australasia are expected to underperform global growth due to market maturity. Asia, Africa, and the Middle East are expected to outpace the global average growth due to their large and growing populations, as well as favorable demographics.
- A decline in cardboard box consumption may signal reduced demand for packaging and labeling services. Industry insiders suggest box demand has fallen amid economic uncertainty among businesses, the impact of tariffs on trade, and softening consumer spending, according to The Wall Street Journal. A weak housing market has also reduced demand for boxes used in moving and packaging for construction materials and appliances. In August, International Paper said it would permanently close two containerboard mills in Georgia by the end of September, reducing the firm’s containerboard production capacity by 9%.
- A new survey by logistics firm Ryder identified consumer ecommerce packaging preferences, according to Packaging Dive. By a significant margin, consumers prefer boxes over bags for ecommerce packages, with the top reasons including better product protection (36% of survey respondents), potential to re-use or repurpose boxes (29%), and the belief that boxes are friendlier to the environment (14%). Consumers also expressed preferences for premium packaging that offers unique unboxing experiences. Such experiences can improve customer loyalty and increase the likelihood of consumers posting product and packaging photos or videos to social media.
Industry Revenue
Packaging and Labeling Services
Industry Structure
Industry size & Structure
The average packaging contractor operates out of a single location, employs fewer than 40 workers, and generates $8-9 million annually.
- The packaging and labeling services industry consists of about 1,600 firms that employ 64,400 workers and generate $10 billion annually.
- Firms that generate less than $10 million annually account for 88% of industry participants but only 25% of revenue.
- Firms that generate between $10 million and $25 million annually account for 7% of participants and about 19% of revenue.
- Firms that generate more than $25 million annually account for 5% of participants and about 56% of revenue.
- Some large contract manufacturers, such as Aphena Pharma Solutions and Hearthside Food Solutions, have integrated contract packaging operations.
Industry Forecast
Industry Forecast
Packaging and Labeling Services Industry Growth
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