Contract Packaging - the new frontier for brand innovations

There is a “perfect storm” of market forces turning food and CPG manufacturers to CP/CM partners for product, process and external innovations. Consumer trends, sustainability, and new technologies are also drivers of this “new frontier.”

Impact Zone
Impact Zone

Speaking at the ProFood Tech Impact Zone on Wednesday, Carl Melville, founder and CMO of the Melville Group, says that contract packagers used to be the “Rodney Dangerfield” of manufacturing – getting no respect. But all that has changed as the decision to enter a relationship with a contract packager/contract manufacturer (CP/CM) usually originates at the C-suite or even the board level, and the service suites provided by CP/CMs continue to grow and create ever-evolving relationships.

Melville says the current CP/CM industry is valued at $59.8 billion, with an estimated value of $95.5 billion by 2022 and a CAGR of 12.24 percent over the next five years. Mergers and acquisitions are also a big part of this industry, at $5 billion dollars in 2018. Melville says one in four contract manufacturers are looking at acquiring, or being acquired, in the next year, and that more than half have two or more locations.

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