In-mold labeling (IML) continues to be a niche process that represents only about 3 percent of the total labeling demand for packaging, according to the latest study from Alexander Watson Associates, released at the IMLCON in Phoenix this past week. North America represents 21 percent of global label demand; Europe has 27 percent of demand and Asia has the largest demand at 37 percent.
Pressure sensitive and glue applied labels are the largest label segments with 38 percent each, followed by shrink sleeve labels at 17 percent. Glue applied labels are in declining in developed markets, and sleeve labels are strong growth in all areas of the globe even taking some demand away from pressure sensitive.
Although IML is considered a niche market, there are plenty of products in IML packaging. Just check out the retail shelves and you’ll find a variety of products from laundry detergent to coffee containers and yogurt packaging – all sporting IML.
One of the major reasons IML remains a small niche in the packaging label market is the large upfront investment in molds, machinery and automation equipment. Many brand owners aren’t willing to make that kind of investment. Another obstacle to any significant growth in IML is the many SKUs that major consumer products’ manufacturers have for their products. For example, there may be one style of bottle for a brand owner’s laundry detergent but seven different types of detergent ranging from different scents, some with bleach and some without, all requiring different labels.
It was noted at the IMLCON that if IML systems could be more flexible, there might be greater demand. For large volumes, to be cost effective labels need to be made by the thousands. That means that if an ingredient changes, or the product isn’t selling well and the brand owner pulls it from the shelves, they may have hundreds of thousands of bottles or containers in the warehouse at the filler’s facility that will have to be scrapped because the label is a part of the bottle or container.
However, injection molded IML is the most popular with some small demand (about one percent in North America) for IML in thermoformed containers. That means there is still room for growth – if we can overcome the cost obstacles to get there.