Flexible Packaging is seeing a rapid growth in all market segments. The major flexible packaging markets accounted for around $31 billion in annual sales in 2017 that include industrial materials, retail and institutional food and non-food (medical and pharmaceutical), trash bags, shrink and stretch films, and consumer storage bags and wraps. This is reported by the CEO of the Flexible Packaging Association (FPA), Alison Keane, at its annual meeting last month in Phoenix, USA.
Flexible packaging contributes about 19% of the $167 billion U.S. packaging industry. It is the second largest packaging segment following the corrugated paper and ahead of bottles and miscellaneous rigid plastic packaging. The flexible packaging has experienced a growth from 17% in 2000 to the current level of 19% in 2017, due to its usage in replacing other packaging styles and its solid long-term strength.
Despite of the fact that industry is experiencing a wave of consolidation, FPA has left with 411 member companies as compared to its previous count of 668, due to the mergers and acquisitions. Keane reported that ‘as companies are “making more with less”, there is an increase in sales. “Twenty years ago, we saw big companies buying small and mid-sized firms, but in 2017 we saw the big guys buying the big guys. The top 10 converters today account for 54% of the market,” he adds.
Growth rates are stable and revenues are above the GDP benchmark. The revenues are expected to rise continuously. Although, materials contribute about 53% of the cost-to-manufacture.
A report published by FPA highlights the industry that adds value to flexible materials, mainly by performing multiple processes like laminating, extrusion, printing, coating and bag/pounch manufacturing.
The flexible packaging is valued at around 24.1 billion for 2017, and it does not include consumer storage bags, retail shopping bags, or trash bags, noted by Keane.
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