Shaping the future of PPE industry

The PPE industry does present a number of opportunities for both existing and new businesses. But meeting the growing demand without sacrificing quality must be the main goal.

When you think of personal protection equipment (PPE), steel-toed boots or a disposable face mask may come to mind. However, modern PPE goes beyond the fundamentals to include cutting-edge equipment, like garments with sensors that track body temperature and thermoplastic-coated protective gloves that are robust but flexible.

While the PPE business has been active on a global scale, the Covid-19 disaster brought it into the spotlight. The global healthcare problem is becoming worse, and there are not enough PPE kits to go around. As a result, the PPE manufacturing market grew like never before.

In India, the PPE manufacturing capabilities have dramatically expanded production following the Covid-19 crisis. The country produced almost four lakh PPEs each day, making it the second-largest exporter of PPEs in the world. The sector has grown to a value of over Rs. 7000 crore due to the rising demand from both domestic and international markets, and is expected to continue expanding steadily.

Due to low production costs, easy access to raw materials, and border limitations in other trading nations, India’s PPE business has developed into a successful industry. This has created favorable opportunities for the export of work-related protective equipment. Majority players in need of PPE include both domestic and international industries, including automotive, chemicals, oil and gas, and others.

In addition to these elements, India’s regulatory frameworks are improving for the PPE sector. Demand and supply has increased as a result of regulations requiring manufacturers to provide their workers with the essential PPE in specific situations. While ensuring that it is still regulated, the government has actively assisted in the industry’s growth. The sector was able to unify its procedures and produce goods that met international standards, thanks to the new regulations.

The government has been awarding new infrastructure development projects, leading to increase of construction and development, thereby having a positive impact on demand for safety products. Stringent policies and the introduction of new licenses, like the CDSCO license for face masks, have had a positive impact on product demand from the end-use industries, both in the country and overseas. In terms of the end-use industry, PPE has a plethora of applications due to its industry-agnostic nature, and is scheduled to witness growth in the future as well, making it one of the leading sectors in India.

In the road ahead, to achieve better growth and competitiveness, the Government of India seeks to leverage India’s vibrant research and development ecosystem. To develop and improve the quality and efficacy of PPE, India is actively seeking collaboration with foreign firms from countries that are leading innovators in the PPE segment.

Knowledge transfer at the international level through active partnership has, therefore, become the new order in the sector. This is creating a huge scope for leading foreign PPE producers to invest in the Indian market and achieve a profitable return on their investments.

Global market
The global healthcare PPE market size was valued at USD 22.66 billion in 2022. The market is projected to reach USD 30.28 billion by 2029, exhibiting a CAGR of 4.2 percent. The global Covid-19 pandemic has been unprecedented and staggering, with healthcare PPE experiencing higher-than-anticipated demand across all regions, compared to pre-pandemic levels. The global healthcare PPE market exhibited a growth of 223.9 percent in 2020 as compared to 2019.

Disruption in supply chain and high product pricing due to Covid-19 pandemic hampered growth. The Covid-19 pandemic has exposed supply chain vulnerabilities within many industries. Offshoring of PPE kits to low-cost suppliers has been promoted or forced in healthcare systems in many countries. Factory closures and travel bans have placed considerable pressure on the supply chain of these kits. Simultaneously, the evolving Covid-19 pandemic contributes to technological strains in the supply chain sector.

The Society for Healthcare Organization Procurement Professionals (SHOPP) conducted a research and pricing analysis for a 100-bed facility that handles Covid-19 patients. They observed a 1064-percent surge in the cost of the required healthcare PPE due to the pandemic. For customers, who use nitrile gloves due to the lack of vinyl gloves or other allergies, the price surge is much higher (1084%). Patients are highly charged due to the costly healthcare PPE, used by medical workers as a part of the extra sanitization measure. Although the supply chain has changed in recent months, a small number of healthcare facilities and companies continue to have trouble obtaining items, such as gloves and respirators.

Rising demand for PPE products from healthcare industry to aid market growth. Since the disease is extremely contagious and can spread asymptomatically, medical professionals and patients in critical care are becoming more concerned about their protection. The global impact of Covid-19 pandemic created a high demand for healthcare PPE products in the industry, including gloves, face masks, gowns, coveralls, face shields, and goggles. The growing awareness regarding the use of PPE to reduce the exposure to hazards that can cause serious health issues shall boost market growth. Companies are focusing on increasing the production capacities of the product to support the overall market growth. For instance, since the outbreak of the pandemic, N95 respirator output at 3M’s global manufacturing sites, including those in the United States, Asia, and Europe has increased to 1.1 billion per year. In the initial stages, the Covid-19 outbreak in China created a huge demand for these products for doctors and healthcare workers that resulted in the disruption of the supply chain in other countries.

The increasing demand for respiratory protection, hand protection, and protective clothing in the healthcare industry to ensure the safety of people and healthcare workers during the ongoing pandemic is expected to boost the demand for healthcare PPE in the market. Healthcare workers are at a high risk as they are working in a high viral-load environment. In April 2020, to safeguard the medical personnel deployed at Covid-19 treatment clinics, the National Aerospace Laboratories (NAL) collaborated with MAF Clothing Private Limited to develop quality-certified and cost-effective fabric-based personal protective suits.

The growing concern toward worker safety and health, coupled with the increasing number of Covid-19 cases worldwide, is likely to boost the demand for the product. Strict government norms about safety concerns would force employers to comply with industry principles, thus stimulating the need for PPE in the healthcare sector. These factors are expected to boost the healthcare PPE market growth.

A shift to online sales. The pandemic accelerated online PPE sales. Manufacturers have partnered with online retailers, such as Amazon and Alibaba to deliver bulk PPE sales to hospitals and individual consumers. PPE sales through specialists, wholesalers, and maintenance, repair, and operations organizations also are expected to increase through 2024.

In addition, the sales function is evolving from a straightforward proposition of providing products to delivering outcomes along with products. Companies that sell ear protection, for instance, may also train customers’ employees on how to use the products to reduce the potential for hearing loss. More and more selling is about creating brand recognition that enhances customer loyalty and an effective e-commerce strategy. This sales evolution allows PPE vendors to forge stronger partnerships with customers, which they can use to sell a higher level of safety performance along with their products, instead of competing solely on price.

Some of the key market players are 3M, Honeywell International Inc., Ansell Ltd., Alpha ProTech, Avon Protection, DuPont, COFRA S.R.L., Uvex Group, Mallcom Ltd. MSA, Blue Eagle, Udyogi Plastics Pvt. Ltd., Gateway Safety Pvt. Ltd., Radians Inc., Rock fall Ltd., MCR Safety, Kimberly-Clark Corporation, Sioen Industries NV, Protective Industrial Products, Inc., Moldex-Metric AG & Co. Kg., and Cordova Safety Products.

Industry updates
In May 2022, Honeywell announced two new NIOSH-certified respiratory offerings to help meet the needs of healthcare workers. The new products will expand PPE portfolio for healthcare professionals.

In June 2021, Ansell, a global pioneer in protection solutions, signed a contract with the European Union (EU) to help address the ongoing and crucial requirement for PPE to support the pandemic response. Ansell’s capacity to supply up to three million AlphaTec 2000 disposable gowns, if needed, over the following 12 months is guaranteed under the agreement, to protect crucial frontline healthcare professionals participating in the deployment of Covid-19 vaccines. And in May 2021, Ansell joined the Tyvek Together program to meet the growing need of critical protection and supplies for PPE.

In July 2021, Honeywell International Inc. and Premier Inc., a hospital resource company, collaborated to produce 750 million nitrile exam gloves in the US per year. This strategic partnership will address issues in the medical supply chain for healthcare PPE, which gained a lot of attention since the Covid-19 pandemic.

In May 2020, DuPont joined the Gerber PPE task force to help increase the manufacturing and supply of PPE garments made from Tyvek material.

Opportunities in PPE product segments
Current conditions have divided the PPE market into winners and losers. For example, the pandemic has boosted short-term demand for some hand-protection and protective footwear used in healthcare and pharmaceuticals and in food and food processing. Simultaneously, however, slowdowns in oil and gas, construction, and mining have been hard on demand for protective clothing, footwear, and hand protection in those sectors.

Sales of disposable and durable hand coverings, the largest PPE product segment, are expected to grow by an average of 11 percent per year through 2024, buoyed by product innovation, evolving sales channels, and growth in the construction, manufacturing, and healthcare sectors.

Key uses for hand protection include rubber gloves for safety, disposable latex gloves in the healthcare and food industries, and cut-resistant and utility gloves that offer additional grip, which are used in industrial environments. Durable gloves accounted for 59 percent of hand-protection PPE sales in 2022, a number that is forecast to remain stable through 2024.

Increased attention on hygiene and safety practices bolstered demand during the pandemic. But new materials also are giving hand-protection manufacturers cause to innovate, which is adding to sales. New materials include biodegradables that break down 40 times faster than previous compounds used in disposable gloves. Innovations extend to durable gloves, including a liquid additive called polyborodimethylsiloxane that hardens on impact. The substance creates a protective coating over thermoplastic rubber that can make gloves stronger and more flexible without making them thicker.

The protective clothing segment consists of garments primarily used in heavy industrials and healthcare. Heat-resistant and flame-retardant garments and chemical-protective clothing make up 58 percent of the segment, which is expected to grow by an average of 12 percent per year through 2024 to USD 5.4 billion. Key industrial applications for protective clothing include coveralls that protect against splashes or prevent cuts on the shop floor and chemical-resistant jackets used in medical and pharmaceutical manufacturing.

Demand in those industries and new product innovations are expected to bolster sales of protective clothing, while competition should continue to increase PPE margin pressures.

Innovations include smart clothes and wearable technology that improves employee safety. Smart clothing – which can monitor body temperature as well as detect gas, chemicals, heat, or other potentially hazardous conditions and alert the wearer to take preventative steps – is catching on in the process industries, such as oil and gas, chemicals, and metals.

The protective-clothing market is expected to see continued strong growth in healthcare, pharmaceuticals, and semiconductors. That could make up for a near-term slowdown of protective-clothing sales in the oil and gas industry, which traditionally has accounted for up to 40 percent of total sales in the segment. As a result, overall sales in the segment are expected to grow by an average of only 7.5 percent through 2024.

Protective footwear is primarily used in the construction, oil and gas, and mining industries. Leather and rubber foot coverings account for two-thirds of this product segment, with the balance coming from polyurethane footwear.

Product innovation is bolstering protective-footwear demand, as is rising safety awareness and the need for industrial employers to meet OSHA standards for safety shoes and other types of protective footwear. User comfort and safety also are motivating product innovation. For example, advancements in metatarsal protection have led to footwear that is safer and more comfortable.

Respiratory gear is primarily used in healthcare, chemical, food, and metal processing. Key uses of this PPE segment include disposable respiratory masks, respirators with airway tubes for medical procedures, and respirators with active filters used in hazardous environments. Measures that healthcare providers put in place during the pandemic created a short-term surge in sales.

The competitive landscape for the PPE industry will be very different in 2030, driven by innovation, disruptive business models, and advent of smart and wearable PPE products transforming the workplace to a connected domain, enhancing worker safety and productivity.

Challenges and way forward
Even though the Indian PPE market is always introducing new products with lighter protective gear, breathable features, high-grade materials, and technical advancements, the sector still faces some significant obstacles.

Raw material quality management is a significant difficulty in manufacturing due to the lack of a steady supply of materials of the highest caliber. PPE is made by a multi-step procedure. It is crucial that the suppliers of raw materials adhere to the rules and uphold the required level of quality.

Although the pandemic forced people to reevaluate preventive measures, there is still relatively little knowledge regarding product certifications. The face mask is one of the most prominent examples of this. A staple accessory for almost everyone in the country today, face masks for the longest time were bought without giving a second thought to their certification. This lack of awareness from the customer’s end often leads to the market flooding with counterfeit products.

Even though manufacturers now adhere to protocol and suggested PPE regulations, relatively few companies have access to worldwide standard testing facilities. This is valid not only for medical applications but also for protective gear used in physical labor-intensive jobs where accidents and illnesses may prove lethal.

The PPE sector does, in the current environment, present a number of opportunities for both existing and growing brands. But meeting the growing demand without sacrificing quality must be the main goal. Businesses run the risk of lowering quality by frequently operating at capacity.