160 | Regulars / Label trendsLabel trendsFacing rising material costs and sustainability challenges, the labeling industry is at a crucial point of transformation. In response, the numbers show adoption of digital tools and automation technologies are reshaping the process of label conversion.Automation’s impactAccording to recent surveys:of suppliers cited automation of suppliers surveyed predicted as the most positive infuence automation will make the biggest 62% 73%on their business impact on their business in 2023.Why digital? Margin pressures mounting63% of suppliers and 73% of brands said shrinking margins due to rising costs of materials are their biggest challenge for 2023Rising costs in 2023:(Material, percentage increase in 2023)16% 22% 15% 12% 11%Wood Steel Concrete & Masonry Electrical conduit InsulationProft margins are declining across the S&P 500, which covers a variety of industries, as shown:S&P 500 Net Proft Margin: Q2 18 – Q1 2314.0%13.5%13.0%12.8%13.0%12.7%12.5% 12.4% 12.3%12.2%11.9%11.9%12.0%11.6%11.4% 11.4%11.5% 11.3%11.2%11.1%11.0%10.9%10.8% 10.8%11.0%10.5%10.0%9.5%9.2%9.0%8.5%8.5%8.0%7.5%7.0%6.5%6.0%Q2 18 Q3 18 Q4 18 Q1 19 Q2 19 Q3 19 Q4 19 Q1 20 Q2 20 Q3 20 Q4 20 Q1 21 Q2 21 Q3 21 Q4 21 Q1 22 Q2 22 Q3 22 Q4 22 Q1 23Source: FactSet, Gordian, 2023 Packaging Trends by Eskolabelsandlabeling.com