A lot has been made recently, including a lot of column inches in this magazine, about the rise of technology in the cleaning equipment supplies and hygiene market. New products have been developed catering for consumers’ increasing awareness of health issues and personal hygiene, and manufacturers would agree that they have benefited from this wave of concern. The revenue to be made is huge, with sales of disinfectants (antibacterials) and sanitisers (mostly alcohol-based products) recording the fastest growth. In the US alone, sales are expected to top $700 million by 2007.
Some in the industry are sceptical of the new jargon that has infiltrated this market, from nanotechnology to antimicrobial, and the claims of nearly all new products which state their progress in breaking new ground in the war on bacteria. But this is the nature of a rapidly expanding market where genuine technological advances have combined with an increase in demand. In this environment it’s not difficult for legitimate breakthroughs to mix with gimmicks and over zealous marketing.
Debate
Equally as interesting as the debate about which cleaning products keep us the freest from germs is the way the cleaning supplies market has changed. There is an almost visible spring in the step of this industry, it’s an exciting, consumer-driven business to be in. And the OP market, smelling new technology and consumer demand, is keen to find out what’s next to appear out of the manufacturers’ labs.
Karen Harrison, brand co-ordinator at specialised cleaning products manufacturer AF International, says the OP reseller community and the manufacturers have a strong bond in such prosperous times.
"We feel our relationship with the office product resellers is very good. We support them as much as possible in both sales and marketing. We assist many of them with internal promotions, we attend exhibitions, and we supply sales and marketing. As a company we understand how important it is for us to demonstrate to them that we are a committed organisation as well as appreciative of the work they put in."
The company receives a steady 55 per cent of its revenue from OP resellers, and Harrison says that "cleanliness, the environment, less absenteeism, and the best product on the market for the job" are what consumers are looking for.
"OP resellers are always on the lookout for new products to generate sales and ultimate profit. As a manufacturer, we seek to provide innovative new products for them to market that will sit alongside their more traditional offerings and appeal to the same customer base."
This innovation is key to the success of the cleaning equipment and hygiene supplies market. Kleinmann can certainly be held up as one company for which innovation is central to its culture. Its nano products have been in the headlines ever since the Sonnenbühl-based firm decided to head down the microscopic route.
"The near future (the next five years at least) will be nano-based technology. It is that simple," says Neil McClelland, UK project manager of nano products for the company.
"There will be a significant overlap between the OP industry and the typical jan/san market. I should add the caveat that there are many organisations which are offering nano products which are not true nano products. The organisations will be exposed as soon as the end-user becomes more knowledgeable."
In contrast, AF says it intends, at least in the near future, to keep away from such technology. "For AF, this is not the route to take," says Harrison. "We already provide products which sanitise and improve the workspace; for example the Clene-Swipe range for large offices and call centres has been shown to reduce absenteeism, a key factor in this growth area."
But Kleinmann’s passion and confidence to head down the nano route is clear. McClelland says the company is quick to respond to consumer feedback and new ideas, fuelling innovation for the nano products of tomorrow. The firm is currently busy developing new products for an eclectic mix of resellers outside OP, including "one of the world’s largest auto manufacturers".
Innovation
Offshoots like this are just an example of how cleaning and hygiene supplies manufacturers are finding new channels for their products, making for an interesting day at the office for those in the industry.
One such enthusiastic businessman is Doug Skeggs, VP of marketing at Systemcare. The company he jointly set up has found itself in huge demand during the last few years, as various health scares have seen a massive drive for the bactericidal products it manufactures. Following the last outbreak of SARS, the company found itself working 24 hours-a-day to satisfy demand for antibacterial hand wipes for telephones.
"The market is developing in lots of different ways. I think the jan/san category is very exciting and it’s going to create some excellent growth throughout our industry," says Skeggs. "I think a key factor is that ten years ago we were talking about how the market was equipment cleaning and maintenance. But now you add the word ‘hygiene’ onto that. That’s certainly where we’ve seen our market develop at Systemcare. Everyone is now aware of the hygiene and sanitising issues in the office and workplace environment."
Skeggs says the company responds to what the end-user is asking for, then develops those products and puts them to its private label customers. Most recently the firm created a range of products to protect against Avian Flu (see box), innovating to satisfy consumer demand.
The private label area of the business is getting stronger by the year, as existing chemical and cleaning products companies wake up to the fact that consumer demand jumps every time there is a scare then returns to a higer level than it was previously. This market, hungry for all types of chemicals, wipes and gels that clean should leave an opening for a company like Systemcare to produce jan/san private label products on a mass scale. But Skeggs says it isn’t that simple.
Competition
"We can successfully market private brands of speciality equipment cleaning products on a global base, but we have found it much more difficult with jan/san cleaning products. Many different retail brands have become established as household names over many years in a huge number of different countries, with users preferring to purchase their local country brands for their own use in the supermarket. This makes it very difficult to develop a private brand when competing against products which end-users see on TV and in magazine advertising continually, and which they already use at home. This also brings pressure on the margins as OP dealers have to make sure they are competitive with their local grocery store.
Skeggs says Systemcare focuses instead on making its offering more specialised to its private brand customers, growing its portfolio by concentrating on unique products which make the dealer higher profit margins.
Kleinmann, a specialist private label manufacturer, supplies over 200 companies a year, while for AF, private label accounts for approximately 30 per cent of its business.
"Companies would prefer to promote their business by strengthening their own brands, therefore more and more companies are approaching us to work with them on this," says Harrison. "The private label area of our business is growing fast; we have the facilities to allow us to be extremely competitive in this area."
The huge confidence these companies have in what they create and the forward-thinking that goes into predicting and satisfying consumer demand is admirable. The OP industry would do well to look at this market and find ways of joining the party.
