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Difference Between Packaging and Labelling

Published on September 16, 2025

Last updated on September 15, 2025 • 6 min read

In India’s thriving consumer market, where millions shop daily from bustling bazaars to online platforms, the way products are presented can make or break a brand. The difference between packaging and labelling is key for businesses, whether it’s a spice vendor in Varanasi or a cosmetics startup in Bengaluru. While both are crucial for grabbing attention and meeting regulations, they play distinct roles. 

This blog explores what sets packaging and labelling apart, their benefits and challenges, and how they drive success, with insights tailored for Indian entrepreneurs, students, and retailers.

Table Of Contents
  1. What Is Packaging?
  2. What Is Labelling?
  3. Key Differences Between Packaging and Labelling
  4. Benefits of Packaging and Labelling
  5. Challenges in Packaging and Labelling
  6. Streamline Your Packaging and Labelling with WareIQ
  7. Conclusion
  8. Frequently Asked Questions

What Is Packaging?

Packaging refers to the process of designing and creating a physical container or wrapper for a product. It’s the box, bottle, or bag that holds items like biscuits, shampoo, or spices. 

In India, where products travel from warehouses in Delhi to rural shops in Assam, packaging ensures protection, ease of handling, and storage. Beyond functionality, packaging is a marketing tool. A vibrant package of mango pickles from a Gujarat brand can catch a shopper’s eye in a crowded Kirana store. Materials like plastic, glass, or cardboard are chosen based on the product’s needs, with sustainability gaining traction as 44% of Indian consumers prefer eco-friendly packaging, according to a 2022 Rakuten Insight survey.

What Is Labelling?

Labelling involves displaying information on the packaging or product itself. It includes details like the brand name, ingredients, usage instructions, and safety warnings. 

In India, labelling must comply with regulations like the Food Safety and Standards Act, 2006, or the Legal Metrology Act, 2009, ensuring consumers in Chennai or Patna get accurate information. Labels guide consumer decisions. For example, a nutritional label on a pack of oats helps a health-conscious buyer in Bengaluru choose wisely. Types of labels include brand labels (e.g., Amul’s logo), descriptive labels (usage instructions), and grade labels (indicating quality).

Key Differences Between Packaging and Labelling

Understanding the difference between packaging and labelling is essential for businesses to meet consumer needs and regulatory standards. Here’s a clear comparison:

AspectPackagingLabelling
DefinitionDesigning and creating a physical container or wrapper for a product.Displaying textual and graphical information on the product or its packaging.
PurposeProtects the product, facilitates handling, and attracts customers.Provides product details, ensures compliance, and aids consumer decisions.
MaterialsUses plastic, glass, metal, or cardboard (e.g., bottles, boxes).Involves printed stickers or direct printing on packaging.
FunctionEnsures product safety, storage, and visual appeal.Communicates essential information like ingredients and warnings.
Regulatory FocusFocuses on material safety and environmental impact.Requires adherence to strict content accuracy and legal standards.
Marketing RoleEnhances brand visibility through design and aesthetics.Builds trust through clear, informative content.

Benefits of Packaging and Labelling

Both packaging and labelling offer unique advantages that drive product success in India’s competitive market:

Packaging Benefits

  • Protection: Prevents damage during transport, like safeguarding fragile glass jars of honey from Himachal Pradesh.
  • Contamination Prevention: Keeps products like milk or spices free from microbes, crucial for India’s diverse climates.
  • Storage Efficiency: Enables easy stacking in warehouses, reducing costs for retailers in Hyderabad.
  • Marketing Appeal: Eye-catching designs, like vibrant tea packets, attract shoppers in crowded markets.

Labelling Benefits

  • Consumer Information: Provides details like expiry dates or nutritional info, helping a diabetic customer in Lucknow choose safe products.
  • Regulatory Compliance: Ensures adherence to laws, avoiding penalties for a cosmetics brand in Delhi.
  • Brand Recognition: Logos and slogans on labels, like Dabur’s, build trust across India.
  • Safety: Warns about allergens or hazards, protecting users of medicines in rural Bihar.

These benefits make packaging and labelling indispensable for businesses aiming to stand out.

Challenges in Packaging and Labelling

Despite their importance, packaging and labelling face challenges in India’s dynamic market:

  • Cost Pressures: High-quality, sustainable packaging increases costs for small businesses in Surat.
  • Regulatory Compliance: Navigating complex labelling laws, like FSSAI’s, can be daunting for startups in Pune.
  • Counterfeit Risks: Poor labelling can lead to fake products, impacting brands in crowded markets like Mumbai.
  • Environmental Concerns: Plastic packaging faces scrutiny as India pushes for sustainability, challenging manufacturers in Chennai.

Innovations like biodegradable packaging and digital labels are helping address these issues.

Suggested – Top Packaging Materials for Safe and Effective Shipping

Streamline Your Packaging and Labelling with WareIQ

At WareIQ, we empower Indian businesses to excel in packaging and labelling with efficient logistics solutions. Our Y Combinator-backed platform ensures your products are packaged securely and labelled accurately, reaching customers nationwide.

  • Custom Packaging: Offer tailored packaging solutions to protect products and enhance brand appeal.
  • Compliance Support: Ensure labels meet regulatory standards, from FSSAI to legal metrology.
  • Nationwide Reach: Store products in 12+ fulfilment centres, delivering to 27,000+ pin codes.
  • Sustainability Options: Access eco-friendly packaging to align with consumer preferences.

With WareIQ, your FMCG brand can deliver professionally packaged and labelled products, delighting customers from Kashmir to Kanyakumari.

Conclusion

The difference between packaging and labelling lies in their roles: packaging protects and markets the product, while labelling informs and ensures compliance. In India’s vibrant consumer market, both are critical for success, from safeguarding goods to building trust. By understanding these distinctions, businesses can create appealing, compliant products that resonate with customers. With solutions like WareIQ, brands can streamline these processes, ensuring every package and label reflects quality and care.

Related – Importance of Packaging: Why It Matters for Your Business

Frequently Asked Questions

What is the difference between packaging and labelling?

Packaging involves designing a physical container to protect and market a product, while labelling displays information like ingredients and warnings on the product or packaging.

What is the difference between packing and packaging?

Packing refers to placing items into a container for transport or storage, while packaging is the broader process of designing and creating the container itself for protection and marketing.

What is labelling and packing?

Labelling is providing product information on packaging or the product, while packing is the act of placing goods into containers for shipping or storage.

What is the difference between a label and a package insert?

A label is an information printed or attached to the product/packaging, like ingredients or warnings, while a package insert is a separate document inside the packaging, often with detailed instructions or safety information.

Supercharge your fulfilment with WareIQ now, contact our team.

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What Is a UPC Code, and Why Is It Crucial for Retail?

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Duty Drawback: Meaning, Process, and Eligibility

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Drawback on Re-Export Whether the imported goods are processed slightly or not at all, if they are re-exported, a drawback can be claimed under Section 74. This reimburses the import duty drawback.According to Section 74, a refund of up to 98% of the import duty can be claimed.What Are the Benefits of Duty Drawback?The duty drawback scheme is not simply a refund; it is an important policy designed to streamline operations. The objectives include:Boosting ExportsExporters can significantly reduce their cost base as well as offer more competitive prices in global markets through cost-effective measures.Avoidance of Double TaxationIf duty drawbacks did not exist, the exporter would have to pay both import duties and export duties. 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The export must originate from India.The claim must be related to imported or excisable domestic materials on which customs or excise duty has already been paid.If the exported goods are manufactured, there should be value addition (i.e., the export value must not be less than the cost of imported inputs in most straightforward cases).Sale proceeds of export must be realised (in foreign exchange) and repatriated to India within the prescribed time as per RBI/EXIM guidelines.Drawbacks will not be admissible for goods or categories that are excluded, such as exports to Bhutan or Nepal under special trade agreements, or those categories that are prohibited by notification.The claim must be filed within the prescribed time limit (often within 3 months of the Let Export Order, with extensions possible).How to Claim Duty Drawback? Step-by-Step ExplanationClaiming the duty customs drawback is a time-bound, document-driven process. Here is a step-by-step breakdown of all the steps that are included to claim the duty drawback scheme:Step 1: Filing the Shipping Bill/Export DeclarationWhen goods are being exported, the exporter can file a shipping bill via Electronic Data Interchange (EDI). More often, the shipping bill itself acts like a drawback claim. 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(ICEGATE has a "Drawback Enquiry" mechanism).How to Calculate Duty Drawback on Export?Now that you are aware of the eligibility and the process to apply for duty drawback, here is how to calculate duty drawback on exports. Step 1: Determine which duties will be eligible. Step 2: Determine how much duty was paid on each imported input (raw materials, components) actually used in the exported product.Step 3: Multiply the duty borne by the applicable drawback percentage. However, it is necessary to make sure that the duty drawback does not exceed the cap.Step 4: For re-export cases where goods were used, a time-based reduction is applied.Step 5: If some portion is disallowed (per rules, notifications, or adjustments), subtract it.Simplify the Duty Drawback Procedure with WareIQWareIQ's smart shipping solution helps eCommerce brands minimise cost leakages caused by RTOs, fake delivery attempts in NDR, weight reconciliation issues, and more. Our solution also offers prompt support for handling urgent client escalations, ensuring smooth operations at all times.Our solution offers the following capabilities:Multi-carrier engine enabling fast deliveries across 24,000+ pin codesControl Tower & automated workflows to minimise NDRs & RTOsSame/Next-day delivery courier optionsSeamless Integration with your WMS, ERPs and StorefrontsShipping Badges to display precise Estimated Delivery Dates (EDD)Custom-branded tracking pages, as well as notifications, to enhance customer experienceConclusionIn order to boost export competitiveness in the Indian commerce landscape, the duty drawback scheme plays an essential role by refunding duties that will eventually lead to cost inflation. Exporters must understand duty drawback, its process, and the eligibility to ensure complete compliance. It is also about reclaiming legitimate refunds that can improve margins and cash flow. For exporters, staying informed as well as filing claims correctly can turn what often feels like a complex process into a strategic advantage, especially in the international marketplace.FAQs About Duty Drawback SchemeWhat is a duty drawback in exports?Duty drawback can also be referred to as the refund of customs duties, excise, or service tax which are to be paid on imported inputs used in the manufacture of goods that are later exported. It helps reduce export costs and makes Indian goods more competitive on the global market.What is the main objective of the duty drawback scheme?The scheme's primary objective is to encourage exports by refunding duties paid on inputs, thereby eliminating the double taxation burden on exporters.How is customs duty drawback different from GST refunds?Customs duty drawback specifically covers customs duties on imports, while GST refunds pertain to the reimbursement of input tax credit or IGST paid on exports.What is the difference between the All Industry Rate and the Brand Rate?AIR is a standard rate applicable across industries. At the same time, the Brand Rate is a customised refund calculated for a specific exporter when the actual duties paid differ significantly from the AIR.

November 17, 2025