Table of Contents
•Private labels have existed in the personal protective equipment (PPE) market for quite sometime and are perceived as low-cost alternatives to national brands produced by established PPE manufacturers. Most distributors source their private label brands directly from low-cost Asian manufacturers.
•Although most distributors continue to procure finished goods, contract-based manufacturing of PPE designed as per distributors’ specifications has increased. This trend is more prevalent in developed economies such as North America and Western Europe.
•Threats of commoditization remain a serious concern as developed markets mature and growth slows. Products that require limited technical expertise are easier to manufacture and, thus, are more susceptible to commoditization, which works in favor of private labels.
•Distributors have steadily improved technical support and are focusing on building brand awareness among their existing customers by emphasizing the performance-price ratio of their private labels. In most instances distributors position and market these products to target end-user industries with high price sensitivity and a relatively low emphasis on product quality.
•As PPE distribution is expected to continue attaining higher sophistication and specialization, private labels are expected to accommodate vital customer trends, with a focus on safety consulting, training, and product customization.
•Most private labels have not yet been able to compete with national brands in PPE segments that require a mid-to-high degree of technical expertise. Although some safety specialist distributors are increasingly taking up the challenge, they will continue to be hampered by limited financial strength and will find it challenging to compete in the aspects of new product and technology innovation, maintaining broad product lines, and providing value-added services.
•Some manufacturers of national brands actively offer private label services in specific commoditized PPE markets.
•Because it creates competition between the manufacturer-owned national brand product and the manufacturer-produced but distributor-owned private label brand product, this approach may appear as a conflict of interest for such manufacturers. This strategy, however, is important for national brand manufacturers that seek to compete in the low-price PPE product segments.
•To compete with private labels, manufacturers of national brands need to continue investing in research and development (R&D) of technologically sophisticated products. Additionally, these manufacturers must concentrate on gaining consumer insights that ultimately help improve product offerings for specific customer needs across various end-user industries and price points.
PPE refers to specialized equipment worn by the industrial workforce to protect themselves from serious injuries and illnesses as a consequence of exposure to workplace-related hazards. Physical, chemical, biological, radiological, thermal, and other hazards vary across facilities and pose serious risks to employees’ health and wellbeing. In sensitive facilities, the role of PPE is to protect employees and to prevent cross contamination. Examples of PPE include hard hats, bump caps, safety glasses and goggles, earmuffs and earplugs, respirators, coveralls, and safety gloves. Private label refers to PPE products produced by a third-party manufacturer for offer in the market under a PPE distributor’s brand name. Private labels have traditionally been positioned as low-cost alternatives to national brands and do not always provide a liability assurance to the customer. There is an increasing trend of private labels being positioned as premium or value enhancer brands to compete with national brands on product quality. Some prominent examples of private label brands in the PPE market include Radnor by Airgas, Condor by Grainger, and Arco by Arco Ltd. National brand refers to PPE products produced and marketed under the brand name of an established PPE manufacturer. The manufacturer may either produce these products at its own facility or subcontract the manufacturing to a vendor. For example, 3M and Honeywell are considered national brands in the PPE market. National brands are generally placed at a higher price point with respect to a comparative private label product, in addition to being offered with quality and liability assurance.
PPE Market Overview
•PPE can be classified into x major product segments, depending on the type of protection offered.
•The global PPE market is mature and is forecast to grow at a CAGR of x to x % from 2014 to 2019.
•Several factors drive the PPE market and have prompted manufacturers to upgrade and enhance product lines, ensuring market dynamism. These factors include the following:
oChanging workplace environments and types of hazards
oUpdates in standards and regulations
oGlobalization and changing workforce demographics
oImpact of fashion and changing customer preferences
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