Jan/san Special Report Part 1



Green and tidy


Fast-acting and working harder than ever, new improved jan/san is a shining example of a market getting ready to embrace the environment


It doesn’t feel like a year since OPI’s last special report on jan/san, but this dynamic sector has surprised everyone by mopping up sales across the industry ever since.


The saying “where there’s muck there’s brass” has never been so true and can clearly be seen in the books of all the major manufacturers, wholesalers and dealers – it’s sweeping the board! Okay, enough with the puns already, but jan/san has provided buoyancy where traditionally stable markets like technology have been lacklustre of late. The latest data from ISSA, the jan/san industry experts, shows non-traditional jan/san resellers in the US growing at an annual rate in excess of 15 percent, with distributor sales worth more than $23 billion (according to 2004 data – a new report is due in September 2007, see the October issue of OPI for details).


One of the most interesting aspects of the sector is its constant movement to encompass new products. Jan/san now incorporates everything from cleaning chemicals to mops, although some firms include the contents of the janitor’s cupboard under the term ‘facilities’. Every dealer should include a comprehensive range of jan/san equipment in their product range, if not for the margin then simply to complete their offering as a one-stop shop for end users.


However, such has been jan/san’s expansion into the office products channel that there is a need for education on the dealer’s side so the end user can be kept up-to-date and properly informed. Some companies are offering consultancy services, while in other areas the manufacturers are taking responsibility to guide the dealer through this world of touchless bathroom paper systems and antibacterial foaming handwash (minus the VOCs of course – see Jan/san Part 2).


Mammoth US wholesaler United Stationers has experienced jan/san growth exceeding 20 percent for the last two years. The company has, like most big players in the sector, seen its own private-label offering routinely contribute to the overall category business growth. United regularly reviews its private-label jan/san, continually adding new products. Education is a large part of its approach and, for the past two years, United’s jan/san category team has conducted more than 75 “jan/san university” sessions across the US and plans more of the same in the future.


Consumer awareness


Mike Miller, the firm’s VP and general merchandising manager for janitorial and breakroom products, says dealers need to make a song and dance about their new
jan/san ranges.


“Three things – consumer awareness, consumer awareness, consumer awareness,” says Miller. “If a dealer makes their consumer customers aware that they sell jan/san items, they will grow in this category. The best place to start an ‘awareness campaign’ is through the constant marketing of these products to their consumer customers via catalogues, quarterly flyers, point-in-time personalised promotions, etc.”


The sector is currently buzzing with success stories. Restroom towel and tissue items have proved extremely popular, with environmentally friendly ‘green’ products, as well as restroom paper with higher recycled/post-consumer content, expected to achieve double-digit growth.


In fact, the green issue is about to take jan/san by storm, with many in the industry predicting the sector to appreciate most from the new green agenda.


The past two years has seen impressive growth for the market in Europe too. Dealer group Quantore has witnessed the sector take off, with its 450 or so dealers watching their ‘facilities’ (including breakroom) annual sales rise from €464,000 ($621,000) in 2005, to €955,000 in 2006, rising to an expected €1.3 million in 2007. Such is the success of this sector, plans for a separate catalogue have been aired among the group.


UK wholesaler Kingfield Heath has seen growth that echoes that of its European cousin. Between 2005 and 2006, the firm witnessed 38 percent growth in jan/san products. Year to date figures are equally promising, with 33 percent growth on the same period last year. Kingfield too has experienced the expansion of environmentally friendly products.


Marketing manager Donna Entwistle explains: “Our dealers are maximising the opportunity that is currently presented through consumer desire to become socially conscious. We’ve found that our dealers are targeting new customers, particularly public sector workers, using our Green Mailer, which includes a wide variety of janitorial lines alongside regular stationery products.


“Our janitorial range currently encompasses branded products and price-fighting whitebox products. I believe that consumers are incredibly brand conscious when it comes to cleaning products.”


Significant growth


At present, there are none of Kingfield’s own Q Connect products featuring in the sector, but the company constantly reviews the market and will introduce products accordingly if it “spots a gap in the market” or receives demand from its customers.


Surprisingly, the company is seeing significant growth in refuse sacks, currently standing at 35 percent on the same period last year, although why this should be is a mystery (answers on a postcard please).


Much like United Stationers, Kingfield is hot on the educational side of jan/san. The firm continually runs presentation sessions, on a one-to-one basis, in groups and at its annual roadshows.


For 2007, the firm’s FM (facilities management) publication will focus on articles that help dealers maximise the opportunity that is presented in today’s marketplace, including cleanliness in the workplace and the rising need to be conscious of MRSA and other superbugs – highlighting the attention this sector is currently enjoying.


Some manufacturers are becoming experts in providing products to cater for the world’s health scares – a new and welcome high-margin addition to the jan/san arena.


Systemcare Products, an experienced company in the manufacture of private-label cleaning products has seen impressive success in this area, by combining various wipes, masks and gloves with specific antibacterial cleaners into ‘personal protection kits’.


Doug Skeggs, marketing director at the firm, says jan/san health and hygiene specials can offer the dealer an opportunity to make some additional margin because dealers are not competing against branded products and every kit requirement is unique.


“We try to do this with our core equipment cleaning lines as well to enable dealers to add value when comparing with other ranges. Major global companies and institutions have been giving enquiries of this type to their dealers for several months now and we are able to offer a variety of products that comply with the relevant official guidelines to help with protection. With this type of product, quality standards are more important than cost.”


But Systemcare and its peers are in a battle to gain territory. The private-label jan/san market is taking on global and local country brands and is trading against users who prefer to buy the same product they buy for the office as they do for the their own homes.


However, Skeggs is optimistic that in time, private branding in jan/san will become just as accepted as in most other industries.


“We have seen a big move to hygiene products for home and office in our category in the last 12 months. We try to make products more innovative in both packaging and product use to enable the dealer to be able to generate more margin.”


That said, much of the office products industry’s attention is focused on the move towards green products. Businesses are keen to be environmentally aware and to be seen being green.


Clean delivery


Entwistle adds: “Demand for more environmentally friendly products will certainly increase as the focus on reducing carbon footprint reaches a peak and standards are put in place for companies to adhere to.


“We constantly seek out products from both existing and new suppliers that will enable us to develop our offering in this area and offer valuable market knowledge to all our dealers.


“In addition, there are opportunities for dealers to target contract cleaners through their service proposition. Next-day delivery and bulk deals will be enticing to companies operating in this arena. Research conducted on local contract cleaners has showed that many have to drive to a supplier’s premises to collect supplies, which is clearly a drain on valuable resources.”


There is clearly room to manoeuvre in this category and the fight is on among dealers and manufacturers for new margin, new customers and new market share. Just remember – don’t be afraid of getting your hands dirty and go green.