The faint smell of disinfectant became a familiar aroma in early 2020. As hygiene hit the headlines, handwashing and social distancing became the new norm and sanitary hand gel a must-have item for anyone on the job, traveling, going to school or even staying at home. In many places, demand for hygiene products soon outstripped supply. The sad but often inspiring events over the last few months have shone a light on the importance of having flexibility in production and our supply chain networks to meet shifting consumer needs.
As the global COVID-19 pandemic spread around the globe in late winter and early spring 2020, consumer shopping habits changed rapidly in anticipation of lockdowns, unemployment and interruptions in supply chains. Indeed, long lines at stores and empty shelves caused by the stockpiling and increased usage of key essentials became commonplace for several months, and still is in some regions. Life in lockdown, followed by a return to greater normalcy around the world has created significant demand for products like masks and hand sanitizers, to the extent that producers from other industries have stepped in to meet demand.
Shifting consumer priorities
The coronavirus is affecting different industries in different ways. In its April 2020 overview of the home care industry, Euromonitor International noted that the COVID-19 pandemic has resulted in greater focus on delivering on two key aspects:
- preserving home hygiene, and therefore health and safety
- product efficacy, without compromise
In the home and personal care (HPC) sector, products like hair dye and cleaning supplies are seeing an upswing in sales as more people adopt a DIY approach to living and spend increased time at home where hygiene has become imminently important. Whereas makeup and scented products have suddenly become less essential given people are socializing less and prioritizing their spending as a result of increased unemployment and economic uncertainty. Already a growing trend, the pandemic has given more consumers cause for pause and their decision-making is increasingly influenced by factors such as clean labeling and the use of ethically sourced ingredients; they are placing greater focus on the health and well-being of not only themselves and their families, but also the environment. That said, when it comes to hygiene, efficacy is paramount, which has led consumers to buy products with stronger chemical formulations.
In a similar study released in April 2020 which focused on the impact of coronavirus on the beauty and personal care sectors, Euromonitor International predicted an increasing shift towards local brands, a boost in demand for mass beauty and personal care products and decreasing growth for premium beauty products. Likewise, the report anticipates the development of a newly redefined channel mix and retail landscape to accommodate people’s changing approach to shopping. The increased emphasis on hygiene is expected to endure both for regions still in the middle of this pandemic but also in those regions where people are returning to a more normal lifestyle, seen in the dramatic demand for shower and bath products, liquid soaps and sanitizers. And while many consumers are looking for value for money, personal products, particularly those focusing on wellness, provide relatively inexpensive opportunities for a bit of indulgence as an antidote to stress and uncertainty.
What sanitary hand gel taught us about the importance of community and flexible production
To safeguard themselves from this quick-spreading virus, consumers around the world are purchasing more liquid soap and sanitizers. Likewise, the B2B sector has massively increased its purchasing of similar products to accommodate more hand washing and comply with stricter guidelines for health and safety. To meet the increased demand for sanitary hand gel, for example, manufacturers have increased their production capacity by repurposing some of their manufacturing facilities, including a redirection of beauty and personal care production. Supply has been further secured by professional cleaning products being re-directed to consumer markets. Likewise, companies operating in allied beauty categories and even other industries are prioritizing the production of these products, increasing demand for raw materials such as ethanol and isopropyl alcohol.
Brewers and distillers alike, including many GEA customers, have stepped up by providing the raw materials or even shifted their own production to make sanitizer and other disinfectants for the B2C and B2B market. In Switzerland, for example, a GEA brewing and distilling customer is taking the alcohol from its rest beer and redirecting some of the alcohol from its spirits production for use as the basis for making hand disinfectant. And there are many more examples – from South Africa to Scotland. While this is not a long-term business strategy for most in the beverage industry, it is an opportunity to contribute to their respective communities and shift away from products whose sales were or may still be suffering as a result of lockdowns and changing consumer behavior.
In New Zealand, our own GEA-Fil team, which focuses on producing hygiene products for the farming industry, fast-tracked the production of its own hand sanitizer for internal use and for its network of customers. GEA is also working with a one of its own suppliers in India to market and distribute much-needed sanitizer to farmers and businesses in that region.
Supporting health and well-being in uncertain times
COVID-19 has proven more transmissible than seasonal flu and people who have it may be asymptomatic for weeks. Given there is no vaccine yet, we must all continue to live with high degree of uncertainty. The HPC sector will therefore continue to play a crucial role in limiting the spread of the virus, while providing a psychological support to households around the world as they battle this invisible threat.