Until the mid-80's the Hungarian packaging equipment market was mainly supplied by domestic manufacturers and was very underdeveloped. The real opening and growth of a competitive market began in 1989, when most of the formerly state-owned firms were privatized and broken up into smaller enterprises and started distributing western packaging products. Although average per capita paper consumption has grown to 80 kg per year since then, it is still far from the European Union's 260 kg figure. This leaves a lot of room for overall growth in the packaging sector. Partly as a result of the ongoing economic restructuring process, the segmentation of companies by size has shown unique phenomena.
Small companies are numerous, but still financially weak and, in many cases, fighting for survival.
There are two traceable market trends at the moment. One is that big users, such as Pepsi Cola, General Electric, local wine companies and breweries are currently replacing their large-scale packaging machinery. As the Hungarian food processing sector has successfully reoriented most of its exports to EU markets in recent years, and as more and more retail sales are channeled through shopping malls and chain stores locally, quality packaging has become a must for producers and distributors. This trend is further strengthened by the availability of special economic development grants from the Hungarian Government to local SMEs to support technical upgrades instead of more extensive use of labor, the cost of which has increased significantly in the past few years, but is still relatively low. Hungarian customers are traditionally European-oriented because of historical reasons and are not familiar with US products in general.