Growing optimism in packaging industry, says survey
The report, What the Global Packaging Industry is Planning in 2010 - 2011: Procurement, Investment and Industry Trends Outlook, found that 62 per cent of packaging converter companies and 66 per cent of packaged goods manufacturers are “generally optimistic” about boosting company revenues in 2010. Such optimism had risen from just 20 per cent in Q2 2009 to 58 per cent in Q4 2009, said ICD Research as part of its annual survey.
Such sentiments were strongest in the emerging markets of India, China and Brazil thanks to “the growth of food processing markets and growth of other related industries such as pharmaceuticals and automobiles”, said the report authors.
There is also optimism that the overall packaging sectors in China, India and Brazil will see expansion by the end of 2011. Dynamic growth, burgeoning food processing sectors and an increased presence of multinational players were all identified. Fastest growth for converters and packaging suppliers in developed regions will take place in the USA, Singapore, Taiwan and Hong Kong, predicts the report.
The greatest growth potential over the next 12 months is likely to be in the recyclable, biodegradable and smart packaging sectors.
“Forward looking expectations show that considerable investment by buyers is anticipated in ‘package design / branding’ and ‘environmental / sustainable packaging’ for 2010,” said the report.
Procurement trends
Procurement spending will be on the increase in the majority of packaging companies. Annual global procurement budgets are forecast to rise by over 6 per cent over the next two years – from 2009/10’s US$62m to US$66m in 2010/11.
Responding to price pressures, keep costs down and increasing competition are the key challenges identified in the survey. The majority of packaging firms are adopting strategies to cut back on waste, budget control and increased automation as ways of meeting these difficulties. Further product development was also highlighted as a major way to drive sales.
The report said buyers are adopting strategies to minimise risk and maintain continuity by cutting down on the number of single source contracts and switching business to more stable suppliers.
Packaged goods manufacturers and converters identified that they are ‘looking for alternative suppliers/capacity’ and ‘seeking “preferred customer” status with existing suppliers’ currently to plan for future product/supply shortages.
What the Global Packaging Industry is Planning in 2010 - 2011: Procurement, Investment and Industry Trends Outlook is available from ICD Research priced US$2,000.
