Packaging and Labeling Services
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
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.
Industry size & Structure
The average packaging contractor operates out of a single location, employs fewer than 20 workers, and generates $8-9 million annually.
- The packaging and labeling services industry consists of about 1,600 firms that employ 65,000 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
Packaging and Labeling Services Industry Growth
Recent Developments
Mar 28, 2025 - Tariffs May Disrupt Packaging Markets
- Some packaging manufacturers and trade groups have expressed concerns that the Trump administration’s tariff-based trade policies could disrupt packaging trade flows and increase costs, according to Packaging Dive. The American Forest & Paper Association suggested trade strife could disrupt North America’s complex paper product supply chains. Several paper companies – including Cascades, Clearwater Paper, and Smurfit Westrock – expressed concerns about escalating US-Canada trade tensions during earnings calls in February. In a recent statement, the Aluminum Association said the US aluminum industry imports about two-thirds of its primary aluminum from Canada because US smelters operating at 100% capacity cannot meet demand. The Plastics Industry Association recently stated deep concerns about tariffs as the US imported and exported more than $70 billion in plastics in 2023.
- Durable goods orders – a demand indicator for packaging and labeling services – may have gotten a boost in February as companies scrambled to make purchases ahead of tariffs. February durable goods orders increased 0.9% over January, beating a forecast of a 1% decline by economists polled by Reuters. Shipments of durable goods increased 1.2% in February over January. While economists suggested the February gains were led by firms front-loading purchases ahead of tariff-related cost increases, the Atlanta Fed expects first-quarter GDP to decline amid mounting economic uncertainty.
- The global market for labels and release liners is valued at $47.2 billion in 2025 and is projected to post average annual growth of 3.6% through 2030, reaching a value of more than $56.3 billion, according to market research firm Smithers. Key demand drivers include packaging volumes and sustainability. Major product areas include paper, film, and ink labels.
- Amid mounting regulatory requirements and consumer demand, more brands are shifting away from plastic packaging in favor of fiber-based alternatives, according to Packaging Dive. The United Nations Environment Program estimates that nearly all single-use plastic products are made with fossil fuel feedstocks, and production, use, and disposal of single-use plastics will account for almost 20% of the global carbon budget by 2040. So far, most of the shifts toward paper packaging have been food and shipping. Several brands are working with packaging firms to develop a paper-based bottle that is durable enough to contain liquids and can be easily recycled.
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