The Global Food Contract Manufacturing Market size is expected to reach $261.2 billion by 2030, rising at a market growth of 9.5% CAGR during the forecast period.
Contract manufacturers contribute to the innovation of bakery alternatives, including producing gluten-free, vegan, and allergy-friendly baked goods. Consequently, the Bakery Products segment would generate approximately 19.18% share of the market by 2030. Contract manufacturers in the bakery segment offer packaging solutions for various products. This involves designing and producing packaging that preserves bakery items' freshness, texture, and quality, including solutions for on-the-go and single-serve products. Some of the factors affecting the market are innovation in formulations and ingredients, quality assurance practices by manufacturers, and risk of over-reliance on specific clients.
Contract manufacturers collaborate with food companies to develop formulations that cater to prevailing health trends, such as the demand for functional foods, organic products, and those with specific health benefits. With a growing emphasis on diverse dietary preferences, including plant-based, gluten-free, and allergen-free diets, contract manufacturers work on formulating products that meet these specific requirements. Innovation in formulations and ingredients is a driving force behind expanding the food contract manufacturing market. Furthermore, Food contract manufacturers are well-versed in local and international regulations governing food production. Their commitment to meeting these standards ensures that their products comply with various market safety, labeling, and quality requirements. As the regulatory landscape evolves and consumer expectations continue to rise, the role of quality assurance in the food contract manufacturing market is poised to become even more significant.
However, Contract manufacturers that heavily rely on a limited number of clients are vulnerable to fluctuations in those clients' demand. A reduction in orders or the loss of a major client can significantly impact revenue and financial stability. Over-reliance on specific clients limits the diversification of a contract manufacturing business. Diversification across multiple clients and industries is a key strategy for mitigating risks associated with market fluctuations, changes in consumer behavior, or industry-specific challenges. These aspects will hinder market growth in the coming years.
Based on end-use, the market is fragmented into convenience foods, bakery products, dietary supplement, confectionery, dairy products, and others. In 2022, the dietary supplement segment registered the highest revenue share in the market. Contract manufacturers play a crucial role in producing custom formulations for dietary supplements. This involves collaborating with brands, retailers, or companies to develop unique formulations tailored to specific health goals, ingredients, and nutritional requirements. The production of dietary supplements requires strict adherence to quality control standards and regulatory compliance. Contract manufacturers in the food industry specialize in navigating complex regulatory landscapes to ensure that dietary supplements meet safety and quality standards.
On the basis of service, the market is segmented into manufacturing, packaging, and custom formulation & R&D. The packaging segment acquired a substantial revenue share in the market in 2022. The packaging service for these products consists predominantly of primary packaging forms, which serve the primary purpose of preventing product contamination. Jars, stand-up pouches, shrink-wrapped containers, and blister packets are among these. These food manufacturers also prioritize incorporating secondary packaging to function as a one-stop shop. Packaging services consider the logistics and transportation aspects, ensuring that the packaging is robust enough to withstand the rigors of transportation while minimizing the risk of product damage.
| Report Attribute | Details |
|---|---|
| Market size value in 2022 | USD 127 Billion |
| Market size forecast in 2030 | USD 261.2 Billion |
| Base Year | 2022 |
| Historical Period | 2019 to 2021 |
| Forecast Period | 2023 to 2030 |
| Revenue Growth Rate | CAGR of 9.5% from 2023 to 2030 |
| Number of Pages | 220 |
| Number of Table | 290 |
| Report coverage | Market Trends, Revenue Estimation and Forecast, Segmentation Analysis, Regional and Country Breakdown, Porter’s 5 Forces Analysis, Company Profiling, Companies Strategic Developments, SWOT Analysis, Winning Imperatives |
| Segments covered | Service, End-Use, Region |
| Country scope |
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| Companies Included | Hearthside Food Solutions LLC, Nikken Foods Co., Ltd., Haco Holding AG, SK Food Group (Premium Brands Holdings Corporation), Pacmoore Products Inc. (Glanbia PLC), Cremica Food Industries Limited, Kilfera Food Manufacturers Ltd, Nutrascience Labs, Inc (Twinlab Consolidation Corporation (TCC)) (Twinlab Consolidated Holdings Inc.), Thrive Foods, and Orion Corporation |
| Growth Drivers |
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| Restraints |
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Region-wise, the market is analyzed across North America, Europe, Asia Pacific, and LAMEA. The North America region recorded a remarkable revenue share in the market in 2022. North America, especially the US, is under a transition phase. Food companies rely more on contract manufacturers for product formulation, quality control, and production capabilities. Moreover, this industry consolidation is happening rapidly, which is expected to boost industry growth. Notably, North America's demand for food contract packaging is experiencing prompt growth, driven by the increasing packaging needs in various categories, particularly in the food and beverage sectors.
Free Valuable Insights: Global Food Contract Manufacturing Market size to reach USD 261.2 Billion by 2030
The market research report covers the analysis of key stakeholders of the market. Key companies profiled in the report include Hearthside Food Solutions LLC, Nikken Foods Co., Ltd., Haco Holding AG, SK Food Group (Premium Brands Holdings Corporation), Pacmoore Products Inc. (Glanbia PLC), Cremica Food Industries Limited, Kilfera Food Manufacturers Ltd, Nutrascience Labs, Inc (Twinlab Consolidation Corporation (TCC)) (Twinlab Consolidated Holdings Inc.), Thrive Foods, and Orion Corporation.
By Service
By End-Use
By Geography
This Market size is expected to reach $261.2 billion by 2030.
Innovation in formulations and ingredients are driving the Market in coming years, however, Risk of over-reliance on specific clients restraints the growth of the Market.
Hearthside Food Solutions LLC, Nikken Foods Co., Ltd., Haco Holding AG, SK Food Group (Premium Brands Holdings Corporation), Pacmoore Products Inc. (Glanbia PLC), Cremica Food Industries Limited, Kilfera Food Manufacturers Ltd, Nutrascience Labs, Inc (Twinlab Consolidation Corporation (TCC)) (Twinlab Consolidated Holdings Inc.), Thrive Foods, and Orion Corporation.
The expected CAGR of this Market is 9.5% from 2023 to 2030.
The Manufacturing segment is leading the Market by Service in 2022, thereby achieving a market value of $162 billion by 2030.
The Asia Pacific region dominated the Market by Region in 2022, and would continue to be a dominant market till 2030; thereby, achieving a market value of $132.6 billion by 2030.
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