Industrial Labels Market – Growth, Trends, COVID-19 Impact, and Forecasts (2021 – 2026)

The industrial labels market was valued at USD 49.25 billion in 2020 and is expected to reach USD 69.8 billion by 2026, at a CAGR of 6% over the forecast period 2021 – 2026. According to a report by PayPal by May 2018, 27% of the citizen in the United States had accessed domestic and cross-border e-commerce in the past 12 months. As e-commerce and m-commerce continue to grow globally, both locally and across borders, there would be a need for high-quality labels to put on the items that have to be shipped around can make it easier to read and track. This would help to prevent items from getting lost or delayed during the transport, thereby contributing the market growth.

– With the growth in industries such as the construction, food and beverages and automotive industry, warning/security labels are also expected to increase owing to the supportive regulations by the government.
– However, increasing cost of raw material is one of the major factor which is hindering the market growth.
– With the rising investments in the market, it will boost the pace of innovation in the market. For instance, in July 2020, Private equity firm Tenex Capital Management announced an investment in US-based Consolidated Label and Online Labels. Based in Sanford of Florida, Consolidated Label and Online Labels offers a full suite of custom printed pressure sensitive, shrink sleeve, flexible packaging, and blank labels on sheets and rolls to small businesses, consumers, and middle-market brands.
– Asia-Pacific is expected to witness the fastest growth because of the presence of two highly populated countries i.e. China and India. These countries are expected to witness the steady growth of consumer goods packaging with the rising e-commerce industry, and growing industrialization in the region is expected to drive the demand for the Flexographic labels in the region, thereby supporting the industrial labels.
– Vendors are also entering into merger-acquisition strategies to enhance their footprint in several geographies. In January 2020, Toronto-based specialty label, security, and packaging solutions provider CCL Industries Inc. has acquired two Spanish companies that make labels for clothing and other products. CCL has bought Ibertex Etiquetaje Industrial SLU and Eti-Textil Maroc Sarl AU, collectively known as Eti-Textil. Eti-Textil offers a full range of labelling products and services, including RFID, while adding to our ALS operational footprint in the important geographies of Liberia and North Africa.
– The COVID-19 outbreak and recent lockdown across the globe have affected the industrial activities across the world. Some of the effects of lockdown include supply chain disruptions, lack of availability of raw materials used in the manufacturing process, labor shortages, fluctuating prices that could cause the production of the final product to inflate and go beyond budget, shipping problems, etc.

Key Market Trends

Food and Beverages is Expected to Register a Significant Growth

– According to a survey by the International Food Information Council, in 2018, 59% of respondents said that they always read labels on packaged food before buying it for the first time and among those, the nutrition facts panel (69%) and the ingredient list (67%) are the two places where the most consumers look for information about food healthfulness. Thus, a healthy symbol on a food package would have a strong influence on a consumer’s purchase decision thereby contributing to the market growth.
– Moreover, with the strict regulations from the governing bodies such as the Food and Drug Administration (FDA), the UK’s Department of Health and Health Canada are imposing the manufacturers to put a label of nutritional statement along with a voluntary statement regarding ‘supplementary’ nutrients. Such initiatives possess a great potential for the industrial label market
– Additionally, Accenture predicted that by 2050, 66% of the world’s population will be staying in the urban area and thus in return it will help in the growing packaged food industry.
– Therefore, the above factors are expected to help in the flourishing of the industrial labels market in the packaged food industry.
– According to the India Brand Equity Foundation, the FMCG sector in India is expected to grow at a CAGR of 27.86 % to reach USD 103.7 billion by 2020 from USD 52.75 billion in 2018. Growing awareness, easier access, and changing lifestyles are the key growth drivers for the consumer market which is leading to a rise in the demand for products, such as branding labels, reseal labels etc in the region.

Spain to Witness Significant Growth

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– The substantial growth in several industries, such as Food, FMCG, Groceries, Cosmetics, and many more, is expected to exhibit a significant increase in the adoption of different industrial label solutions in the country. Hence, the solution providers are innovating to provide enhanced offerings in the market, which will expand their market presence in the country.
– In 2019, Hi-Cone launched its 50% PCR ring carrier, RingCycles, and the new labels are designed to help educate consumers on the product’s sustainability credentials and illustrate how to recycle the rings properly in each region. For example, in Spain, the label points consumers to the yellow recycling bins while in the UK, the label points consumers to the RingRecycleMeprogram in partnership with TerraCycle. The labels, which are coloured green and white, were designed in the UK before entering the market last October in Spain and the UK.
– In August 2020, Fresenius Kabi, which has a firm presence in Barcelona, announced that it is introducing smart labels for a range of essential medications used in pharmaceutical space. The new labels, which feature embedded RFID technology, is expected to be introduced this year for medications commonly used in the operating room, with the first product launching in the next month.
– Fresenius Kabi+RFID medicines will feature a high-performance RFID tag embedded in the label that contains the relevant data that hospitals rely on every day to immediately identify, locate and manage their inventory.
– Moreover, the government of the country is aiming to be climate neutral by 2050. As a step toward this goal, it has announced plans to introduce a tax on single-use plastic (SUP) packaging for food products and an air traffic tax. In September 2019, Mespack (part of Duravant) collaborated with Dow to develop next-generation packaging for recyclability and sustainability. The partnership is expected to drive the development and commercialization of mono-material films, permitting converters and brand owners to meet their sustainability commitments of increasing recyclability of packaging products, which is further creating opportunities for the country market ecosystem.

Competitive Landscape

The industrial labels market is fragmented in nature because of the presence of the major players globally. Factors such as the increasing demand for food and beverages, electronics goods and penetration of e-commerce will provide considerable growth opportunities to the industrial label market and therefore many companies are seeing this market as an emerging market. Some of the major players are Avery Dennison Corporation, 3M Company, Brady Corporation, and Ccl Industries Inc. amongst others. Some of the recent developments are:

– August 2019 – 3M Company launched a Versatile Print Label Materials, which is a proprietary topcoat technology that performs across multiple print platforms such as UV digital inkjet, water-based and UV flexographic, screen, toner-based or thermal transfer. It utilizes water-based technology, but it can be used with many water-based ink systems which help converters to eliminate solvent-based manufacturing process steps like priming. This helped in increasing the company’s efficiency and rationalizing their inventory.
– Feb 2020- Avery Dennison had planned for the future growth of RFID. A few months after signing a deal to acquire Smartrac’s transponder division, the company has announced it will open an RFID manufacturing facility in Brazil in 2021. The move marks Avery Dennison’s first manufacturing facility in Brazil and fifth in the world.

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