Marketing Essay on Growth in the Corrugated Packaging Sector in the UAE

Corrugated packaging comes into play after goods have been produced, during transport, and when they are displayed. Since this packaging process was invented, corrugated packaging has improved the sanitary and safety of goods in transit. Producers protect about 70% of the world’s solid and liquid materials through wrapping before reaching the consumer. The corrugated packaging industry in UAE has witnessed some growth in the recent years compared to other countries. This growth has been attributed to the market potential within and outside of Asia. The corrugated packaging industry in the UAE has dominant players such as, the National Packaging Industries (NPI), which serves the united emirates. This company is known for its market-driven approach and aggressive market campaigns, which have steered its growth in the recent years. It has a highly qualified and experienced workforce, supported by a competitive pricing strategy. Demand for packaging food products has been on the increase in the world and only a few markets have reached the saturation point. For this reasons, food-packaging demand is set to grow (Wever, 2011).

Packaging market dynamics

Growth in the country’s per capita income, growth of consumer society, changing lifestyles, and health consciousness are some of the organization’s key drivers. In addition, the raw materials needed in developing packaging materials are readily available in the country. There are well-established industries that manufacture metals, glass, paper, and plastic materials that are necessitate packaging. The WTO has insisted on the need to label quantity, quality and price of goods. Corrugated board consumption in 2011 was 102 million tones worldwide. This figure is may increase at a growth rate of 4.4% annually. Asia has already dominated demand for corrugated packaging materials, especially china accounting for over 30% of the total demand. This is a positive indication for UAE corrugated packaging industry, which stands to benefit as the sole supplier in Asia. These reasons have called for improved technology and innovations in the packaging market. In order to attain this status, UAE packaging industry has to adopt the new trends in the market, and this has partly facilitated its growth (Smithers, 2012).

The UAE packaging industry recorded a moderate growth in the review period, and it is set to post the same level of growth in the forecast period. This growth was attributed to the increased domestic consumption and diversification of the of AE’s exports. The country’s per capita income in 2009 was $ 50,000, and this is set to increase to reach $80,084 by 2016 growth (National Packaging Industries 2012). A high spending on processed food is expected in the forecast period, and this will propel the growth of the packaging industry. For instance, Abu Dhabi registered an extremely high GDP per capita in 2009-2010 and substantially contributed to the UAE’s spending power. The growth in the packaging industry is also supported by improved consumer increased spending and a favorable economic environment (Report linker, 2012).

Paper and board is one of UAE’s packaging categories within the packaging industry. On the other hand, Food and beverages is a fundamental end-user market, which accounts for over 50% of the industry’s packaging products. UAE also relies on exporting some of its products to foreign countries a trend that has shown an improved growth, which is vital for long-term sustainability of the packaging industry. With the increased demand for the packaging products from UAE, the industry’s growth patterns are on a positive end (Zhang, & Mao, 2010). The packaging trend has changed from a primitive form of packaging to a modern corrugated packaging. Manufacturers and suppliers of perishables and fragile products are more confident with this up-to date packaging compared to the primitive packaging. In addition, the packaging materials are environmental friendly and can be recycled. This is the principal reason; the demand for these products is high, thus increasing the industries.

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