Label Market Remains Strong

Through 2013, U.S. label shipments are expected to advance to $19.2 billion.

The label market is in good shape. Although the recent recession has affected every segment of package printing, the label industry is still well positioned for the medium to the long term, according to Corey Reardon, president and CEO of AWA. "Unfortunately in the short term, the impact has been negative with plenty of casualties in job losses and business performance, even company and plant closures," he says. "In the medium to longer term, the recent recession has certainly caused companies across the value chain to focus on customers and creating more efficient, profitable, and sustainable business models.

"The tag/label industry is generally in a very strong position strategically and financially," says Frank Gerace, president and CEO of Sharonville, Ohio's Multi-Color Corporation and chairman of the TLMI board of directors. "Strategically, tags/labels remain important and relevant as a dominant component in consumer packaging, as a means of both product identification and consumer marketing. Financially, although growth and profitability have declined, [the segment] remains healthy and sustainable."

The outlook

Still immensely popular, pressure-sensitive labels are not the only game in town. Other label types include heat-shrink, stretch sleeve, in-mold, and thermal transfer.

This is illustrated in "Labels to 2013" by the Freedonia Group. According to the study, U.S. label shipments are projected to advance at a 4.5 percent annual rate to $19.2 billion in 2013. More than three quarters of the total gains will be in the pressure-sensitive segment. However, more rapid growth will be achieved by heat-shrink, glue-applied, stretch sleeve, and in-mold labels, the study states, because these application methods provide intense competition for pressure sensitives. "Heat-shrink labels are forecast to outperform all other major label types, benefitting from their attractive 360 degree aesthetics, broad promotional area, and capability to provide tamper evidence, as well as their increasing cost effectiveness and ability to form-fit contoured containers," states the report.

Plastic is going to be very important to labels, according to the study, even though paper will continue to be the most widely used stock material in the label industry. Plastic will account for more than one quarter of label shipments by 2013. "Increased use of plastic stock materials will be supported by the shift toward plastic packaging, as well as the material's aesthetic and performance advantages over paper," cites the study.

According to the report, labels that are printed in some manner before sale to the final user most commonly employ flexography for printing labels, owing to its widespread use in the pressure-sensitive segment. Be that as it may, additional printing technologies are still used, often in combination to achieve superior label graphics.

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