Direct Thermal Ticket Paper – Beating the Counterfeiters and Safeguarding Bottom Lines

The packaging industry continues to tread steadily, however, it is the growing investment in, and adoption of, new materials and technologies that has created a buzz in this landscape.

Direct thermal ticket paper is one such development, partly brought about growing pressures to conform to regulatory norms and emphasis on enhanced functional properties. The features of direct thermal ticket paper, such as paper exhibiting durability, pre-printing sustainability, and utmost security have meant that demand has surged steadily in the recent past.

With the alarming rate of forgeries of tickets coming to light, the transportation industry has become an early adopter of direct thermal ticket paper. Gains have also been driven by broader developments in the e-commerce landscape, especially, in countries, where brick-and-mortar stores are being quickly replaced by the online shopping onslaught. Realizing the enormous growth potential of the direct thermal ticket paper market, Transparency Market Research (TMR), in its latest study, analyzes all aspects in detail, bringing to light critical insights that can be the differentiator in this fledgling marketplace.

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What’s on the Horizon for the Direct Thermal Ticket Paper Market?

Direct thermal ticket paper has been on the billing counter of retailers for quite a long time now, and the shifting paradigms from cash registers to automated POS terminals are likely to sustain its application during the forecast period. According to TMR’s report, the sales of direct thermal ticket paper crossed a value of US$ 420 Mn in 2018, this market is likely to register a CAGR exceeding 6% during 2019-2027.

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As regulations regarding the use of BPA-containing paper become stringent in several countries, consumer perception takes a dramatic shift towards BPA-free direct thermal ticket paper. This has urged vendors to replace BPA-based epoxy coatings, and instead make use of urea urethane, Pergafast, and ascorbic acid to develop compliant direct thermal ticket paper.

Manufacturers who stay abreast with the policies and function towards fostering innovation in their products as per the demand ascending from end-use industries, will be able to safeguard their brand value and net sales. Since disruption awaits just below the surface for numerous manufacturers, the direct thermal ticket paper market is anticipated to gather vigor in the forthcoming years.

Stepping Stones for the Direct Thermal Ticket Paper Market

A major chunk of direct thermal ticket paper sales will remain driven by the transportation industry, where controlling ticket duplication and cost-bearing frauds become crucial. Since the success of the transportation business immensely relies on the reduction of overhead costs, barcode tag-based direct thermal ticket paper is emerging as a viable and valuable choice for ensuring security. Besides transportation, direct thermal ticket paper also finds wider application in the entertainment industry.

In recent times, the developed countries of North America, Europe, and GCC countries have witnessed a tremendous surge in the number of casinos. With the rise in lottery and betting activities, the demand for entrance tickets, cash coupons, and betting slips is showing greater ascendency. The sales of direct thermal ticket paper are outperforming their previous records, as ticketing applications broaden in parallel to transport and admission activities.

Direct thermal ticket paper with a thickness of 90 GSM remains preferable for transport, billing, barcode, and admission/event ticketing applications, and is set to drive the most sales, while thermal paper with a thickness of over 120 GSM is expected to remain a high-growth segment. While a cohort of drivers strive to push the growth bars of the direct thermal ticket paper market, unavoidable overhead costs could significantly impact the bottom lines of manufacturers.

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Since the manufacturing of direct thermal ticket paper is a systematic process, multiple stages ranging from designing to waste recovery use equipment for effective cooking, emission control, and pulp storage applications. This sums up the hefty installation, maintenance, and operation costs, which directly pass on to the price of direct thermal ticket paper. The volatile prices of raw materials, such as pulp, have yet another unprecedented impact on the cost of the finished product, which leads to frequent revisions. For example, Jujo Thermal Ltd. increased the price of its direct thermal ticket paper by 10-15% in March 2018.

With only ‘change in the price’ being constant in the landscape, end-user industries are embracing the novel trend of digitization, which is likely to deter the sales of direct thermal ticket paper.

Sustainability Implications for Direct Thermal Ticket Paper

In the direct thermal ticket paper market, where the intensity of competition levels up a notch every now and then, strategies related to product launches no longer satisfy the appetite of profit-seeking manufacturers.

A significant batch of manufacturers conceal the impact of forgeries to protect their brand impression; however, this can offer a lucrative opportunity to manufacturers to move a step beyond and develop direct thermal ticket paper with a combination of advanced security features. For instance, TELE-PAPER announced the launch of direct thermal ticket paper with advanced security features, such as an invisible photocopy mark, a UV invisible mark, micro coding, a 2D/3D barcode, and a security watermark.

Expansion of manufacturing facilities is becoming synonymous to the success mantra for direct thermal ticket paper manufacturers. For instance, in 2018, UPM-Kymmene Oyj announced the inauguration of a novel slitting and distribution facility in Santiago, Chile. As stringent laws govern the switch of end-user industries to BPA-free direct thermal ticket paper, leading players such as Appvion Operations, Inc. and Koehler Paper Group have already made a shift towards the development of environmental-friendly paper, while regional players are following suit to sustain their position in the market.

Competition Intensity: Highly Fragmented Market

The direct thermal ticket paper market remains fragmented, with numerous players employing organic and inorganic growth strategies to survive in this highly competitive landscape. Acquisitions and expansion are the core strategies of market goliaths, namely, Nippon Paper Industries Co., Ltd, UPM-Kymmene Oyj, Oji Holdings Corporation, Ricoh Company, Ltd, and Koehler Paper. In contrast to this, regional players in the direct thermal ticket paper market expend in research and development activities to cater to the exact requirements of end-users, and foster product innovation.

All-in-all, the competition landscape of the direct thermal ticket paper market will continue to intensify, wherein, innovation, customization, and security will govern the revenue size of companies.

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  • According to Transparency Market Research’s latest market report on the direct thermal ticket paper market for the historical period of 2014-2018 and forecast of 2019-2027, the growing demand for direct thermal ticket paper from casinos and the gambling industry is expected to bolster the growth of the global direct thermal ticket paper market during the forecast period.
  • Globally, revenue generated by the direct thermal ticket paper market is estimated to go over US$ 450 Mn in 2019, and is expected to expand at a CAGR of over 6% in terms of value throughout the forecast period.

Robust Growth in Casinos & Gambling Industry: A Key Driver

  • North America, Europe, and GCC Countries have seen tremendous increase in the number casinos in recent years, which has led to tremendous growth in the demand for entrance tickets, betting slips, lottery tickets, cash coupons, etc., in the direct thermal ticket paper market.
  • Direct thermal ticket paper offers features such as high durability and reliability. Also, it is suitable for pre-printing, which makes it ideal for ticketing purposes.
  • The continuous growth in gambling has led to the increased demand for direct thermal ticket paper.
  • Governments in various countries promote casino tourism in order to generate revenue, which, in turn, is escalating the growth of the direct thermal ticket paper market. For instance, North America has more than 2,300 casinos, around 500 bingo halls, and nearly 45 greyhound tracks.
  • According to the American Gaming Association, in the United States of America, consumers spent a record-setting amount of US$ 38.54 billion on gambling in 2015. This surpasses the industry’s record annual spending of 2013. All these factors are increasing the demand for direct thermal ticket paper.

BPA-free Direct Thermal Ticket Paper is the Latest Trend Being Adopted by Key Market Players

  • BPA is used as a coating, since it provides heat-resistance and stability, while providing a thermal image. Using BPA ensures that the thermal paper safely changes color when exposed to heat, without getting burnt.
  • The printing quality of direct thermal ticket paper is comparatively higher than other alternatives. Growing intolerance of BPA-coated thermal paper has created a lucrative opportunity for the use of non-phenol alternatives, and consumer industries are gradually shifting towards BPA-free direct thermal ticket paper solutions.
  • Urea-based BPA-free direct thermal ticket paper is an on-going trend in the market. Urea-based compound is both, BPA- and BPS-free. It does not trigger any hormone-altering effects. However, the cost of a urea-based compound is slightly on the higher side as compared to BPA- and BPS-coated thermal paper.

Digital Boom to Pose a Major Challenge to the Growth of the Direct Thermal Ticket Paper Market

  • In spite of the optimistic viewpoint, electronic data transmission and online ticketing systems in industries such as transport, gaming, retail, etc., have reduced paper usage for entrance tickets, boarding passes, and others, thus, restraining the growth of the direct thermal ticket paper market.
  • Key manufacturers of direct thermal ticket paper readily say that, “quality with additional security features incur higher printing costs”, which has emerged as a key challenge for the ticketing paper market over the last decade.
  • Consumers, especially in developed economies, largely prefer digital/mobile tickets due to a more secure authentication process and transparency. All these factors contribute in suppressing the market value of direct thermal ticket paper.

Direct Thermal Ticket Paper Market: Competition Landscape

  • Detailed profiles of the manufacturers of direct thermal ticket paper have been provided in the report to evaluate their financials, key product offerings, recent developments, and strategies.

Key players operating in the global direct thermal ticket paper market include Nippon Paper Industries Co., Ltd., Domtar Corporation, UPM-Kymmene Oyj, AhlstromMunksjö Oyj, Oji Holdings Corporation, Ricoh Company, Ltd., Hansol Paper Co. Ltd., Koehler paper, Henan Province JiangHe Paper Co., Ltd., Sihl GmbH, Appvion Operations, Inc., Jujo Thermal Ltd., TELE-PAPER (M) SDN. BHD., Rotolificio Bergamasco Srl, and Nath Paper & Pulp Mills Ltd.

Direct Thermal Ticket Paper Market: Key Developments

Key manufacturers in the direct thermal ticket paper market, such as Oji Holdings Corporation, are strengthening their overseas sales structure by increasing their production capacity. Some other key developments in the direct thermal ticket paper market are as follows:

  • In September 2017, UPM Raflatac expanded its presence in the Americas by acquiring the assets of Seattle-based Converters Express.
  • In Nov 2018, Ahlstrom-Munksjö, a key manufacturer of direct thermal ticket paper, increased its parchment paper production capacity by inaugurating a new production line in Saint-Séverin, France.
  • Hansol Paper acquired Telrol, a manufacturer of self-adhesive labels, in 2014.

In the global direct thermal ticket paper market report, we have discussed individual strategies, followed by company profiles of the manufacturers of direct thermal ticket paper. The ‘Competitive Landscape’ section is included in the direct thermal ticket paper market report to provide readers with a dashboard view and a company market share analysis of the key players operating in the global direct thermal ticket paper market.

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