Caps and closures growth stimulated by single-serve beverages

The competitive edge in the U.S. caps and closures market for noncarbonated beverages is likely to get sharper over time as market leaders already possess a wide number of loyal clients with long-term contracts and are looking to expand. However, smaller players do hold the advantage of adapting to newer technologies faster while the larger players are left to wrestle with the high switching costs.

U.S. caps and closures market

The U.S. caps and closures for noncarbonated beverages market was valued at around US$2.64 billion in 2016, registering a projected compound annual growth rate (CAGR) of 4.3% from 2016 to 2024. By the end of 2024, this revenue is expected to reach $3.82 billion.

That’s according to a report from Transparency Market Research (Albany, NY).

The top five players in the U.S. caps and closures market for noncarbonated beverages had accounted for 55% of the market in 2016, in terms of value. Silgan Plastic Closure Solutions, Closure Systems International, Inc., AptarGroup, Inc., and Bericap GmbH, and Co KG have earned their leads in the market through aggressive expansion tactics and high resource expenditure in innovation as well as the installation of greater number of manufacturing facilities across the country. While there is still a decent piece of the U.S. caps and closures market for noncarbonated beverages that belongs to localized entities, larger manufacturers in the beverages industry are more aware of the brand quality of the leaders, thereby putting more faith in their products.

 

Single-serve beverage demand on the upsurge

"One of the leading factors contributing to the current upswing in the U.S. caps and closures market for noncarbonated beverages is the growing demand for single-serve beverages. The need for specialized caps and closures that complement the highly-touted hot fill process that can increase the shelf life of multiple beverage types. Additionally, the overall demand for convenience foods and beverages is increasing at an exorbitant rate across the U.S., with more and more consumers tending towards edibles that are nutritious as well as easy to eat. The U.S. caps and closures market for noncarbonated beverages fits perfectly into this growing niche and will continue to benefit from this increasing demand over the foreseeable future," states a TMR analyst.

Other factors driving the U.S. caps and closures market for noncarbonated beverages include the increasing favor generated by seasonal beverages as well as the seasonally increasing demand for cold or hot beverages, and the increasing acceptance of current beverages by larger demographics and audiences.

Switching costs too high for many

One of the key problems that a lot of manufacturers in the U.S. caps and closures market for noncarbonated beverages are facing is the cost for switching from current technologies to newer ones. This involves changing from the polyethylene-based two-piece closure that uses compressed molding to the newer, HDPE one-piece closures that require injected molding. The switch involves a lot of expenses as well as a higher level of awareness about closure applications for PE as compared to the PP. The entire distribution chain needs to consider the change from two piece closures to one piece closures as the latter is not as considerate about the manufacturing deficiencies in bottles.

"Players from the U.S. caps and closures market for noncarbonated beverages can earn key opportunities in the region by specifically adhering to the manufacturers of bottled water and energy drinks. Both segments are currently in exceptionally high demand in the country and players can look to switch things up in these areas, in order to compensate for the steadily declining sales in carbonated drinks," adds the analyst.

This information is drawn from a Transparency Market Research report, Caps & Closures Market for Noncarbonated Beverages (Cap Type - Screw Caps, Snap On Caps, and Push On Caps; Material - PP, LDPE, HDPE, PS, PVC, and PET; Application - Bottled Water, Fruit Beverages, Ready to Drink Tea and Coffee, Sports Beverages, Energy Drinks, and Non-dairy Milks)- U.S. Industry Analysis, Size, Share, Growth, Trends, and Forecast 2016 - 2024. For more information, see

http://www.transparencymarketresearch.com/pressrelease/us-caps-closures-market.htm

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