Beverage News
Single-serve Beverage Demand Is On The Rise
Source: Small Sake
The competitive edge in the U.S. caps and closures market for non-carbonated beverages is likely to get sharper over time. The leaders already possess a wide number of loyal clients with long-term contracts and are looking to expand. The 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.
The U.S. caps and closures for non-carbonated beverages market was valued at around US$2.64 bn in 2016, registering a CAGR of 4.3% over 2016 to 2024. By the end of 2024, this revenue is expected to reach US$3.82 bn.
The top five players in the U.S. caps and closures market for non-carbonated 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 non-carbonated 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 non-carbonated 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 non-carbonated 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 non-carbonated 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 a Lot of Players
One of the key problems that a lot of manufacturers in the U.S. caps and closures market for non-carbonated beverages are facing currently 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 need 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 non-carbonated 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.
Source: Transparency Market Research
