The outlook is bright for contract packaging and manufacturing services providers and their customers, according to "Contract Packaging & Manufacturing: Drivers of Machinery Investments," a report published today by PMMI.
Findings that point to strong growth prospects on the brand side: 67% of brand owners plan to maintain or increase their reliance on outsourced services. In addition, three-quarters of contract packaging/manufacturing (CP/CM) companies anticipate significant business expansion over the next three years.
According to the report, brands rely on CP/CM service providers for the following reasons:
- helping brand owners access machinery/packaging formats not available in-house (59%);
- testing new products or packaging (48%);
- offering a customized product/package, especially for short or limited runs (48%);
- supplementing in-house capacity to meet surges in sales volume (43%); and
- better serving the e-commerce channel (7%).
The 51-pp. report, available for download here, was produced in conjunction with DDR/REACH and also details the capabilities CP/CM providers should possess according to brands and the industry challenges CP/CMs must overcome to succeed in this segment.
