The global hand sanitizer market size to be valued at USD 15 billion by 2021 and grow at a CAGR of 17.35% during the period 2019-2025 to reach $4.27 billion by 2025. The market has been witnessing a surge in demand for hand sanitizers owing to the COVID-19 pandemic. This peak is likely to continue for the next two years and would start to normalize after 2022.
The introduction of fragrance-based hand sanitizers is one of the major factors responsible for the growth of the global hand sanitizer market. Vendors have started investing in developing fragrant variants of hand cleansers. This innovation has offered positive dividends and has boosted the market growth. The market is also witnessing an influx of bio-based or organic ingredients in hygiene products in several countries. People are getting aware of the ill-effects of chemical-based hand rubs. Therefore, they are displaying a keen interest in purchasing organic or chemical-free hand gels.
The rise in hospital-acquired infections (HAIs) and pandemics outbreak such as COVID-19 have influenced the growth. The market landscape of hand hygiene products has drastically changed since the outbreak of COVID-19. The average market demand worldwide is likely to witness a phenomenal rise of over 600% during 2020. The increasing demand for sanitizing solutions and preventive recommendations by WHO is expected to fuel market growth. However, the YOY analysis suggests that the spike is not likely to exist for more than two years provided the outbreak is controlled in the upcoming months.
- Gel-based hand sanitizers are the largest selling category in the market. However, liquid and foam-based cleansers are growing in demand among consumers.
- In 2019, the residential sector was the second-largest consumer of hand hygiene products. The growing demand can be associated with the growth in personal income and improvements in living standards.
- The distribution of personal care and hygiene products primarily takes place through retail channels. The hygiene products are mainly sold in bulk to medical shops, hospitals, and other healthcare facilities.
- In the APAC region, India and China have put constant efforts to increase awareness of sanitation and hygiene among people. Therefore, major countries have observed a high demand and consumption for disinfectants in the last few years.
INDUSTRY ANALYSIS BY FUNCTIONAL INGREDIENTS
Alcohol-based sanitizers are the major contributors to the global hand sanitizer market. In 2019, this segment constituted almost 86% of the hand sanitizer market share in terms of revenue. The market demand for such sanitizers is driven by their ability to prevent infections and kill bacteria, fungi, and viruses. The segment is segmented into subsegments – ethyl and isopropyl. The ethyl-based sanitizer segment has witnessed tremendous growth since the impact of the COVID-19 pandemic. The growth opportunities can be attributed to the fact that these sanitizers are 40% more effective against viruses than normal sanitizers. The global ethyl alcohol-based hand sanitizer market is likely to reach 91 million gallons by 2025. The segment is growing at a CAGR of over 16% during the period 2019−2025.
Isopropyl alcohol (2-propanol), also known as isopropanol or IPA, is the most widely applied sanitizing agent in pharma, hospitals, cleanrooms, and devices or surgical equipment. The market analysis indicates that IPA's need has slowly risen due to its use in hand sanitizers. Since the coronavirus infections have rapidly increased in the US and Europe, the sanitization products have become mandatory for healthcare practitioners. Moreover, the European IPA market is increasingly heating up, with producers such as INEOS and SEQENS prioritizing the supply of IPA-containing hand gels to hospitals and health centers. Thus, vendors can currently consider relocating their resources to boost the supply chain and distribution to capitalize on the demand.
INDUSTRY ANALYSIS BY SEGMENTS
The healthcare sector has always been one of the key contributors to the global hand sanitizer market. In 2019, the healthcare sector dominated with its 62% shares, followed by the residential sector. The sale of sanitizing products in the healthcare sector has observed tremendous growth. The rising awareness of contagious infections and the importance of maintaining hand hygiene among individuals is boosting segment growth.
The residential segment is another crucial end-user to be looked upon by vendors. Over the last few years, end-users have become more aware of the hazards of germs and infections prevailing in the environment. They are more careful and cautious in selecting products related to health and hand hygiene. Foam-based sanitizers are in demand in the segment, although gel-based sanitizers are also marking their presence.
SUPPLY CHAIN ANALYSIS
The supply chain constitutes an essential component of product availability and reachability. Supply chain strategies ensure the effective market reach and the allocation of products to several geographical locations. The supply chain of hand sanitizers consists of suppliers of ethyl alcohol, isopropyl alcohol, hydrogen peroxide, and glycerin. It also includes external stakeholders such as packers and labelers, and sub-contract manufacturers. The global supply chain of personal care and hygiene products is currently facing disruptions due to the surge in market demand. With the eruption of COVID-19 in China, the global supply chain for hand sanitizers has been confronted with several disruptions. Since the manufacturers depend largely on a complex distribution mechanism centered around China. Due to the COVID-19 outbreak, manufacturing facilities have jumped into overdrive. Companies are adding overtime and shifts, along with looking for alternative facilities to produce more necessary items.
ANALYSIS BY MANUFACTURERS
Global vendors dominate the global hand sanitizer market. The key market players are 3M, GOJO Industries, P&G, Reckitt Benckiser Group, Unilever, and Vi-Jon. GOJO Industries’ Purell and Reckitt Benckiser’s Dettol were the most preferred personal hygiene brands in 2018. Several international players are expected to expand their presence worldwide, especially in the developing countries in APAC and Latin America. The rising awareness of sanitizer benefits across the globe is likely to intensify during the forecast period. The adoption rate of hand purifiers among end-users worldwide has been impressive. The market is witnessing the entry of several new vendors due to the increased demand. Key players compete on several factors, including price, innovation, quality, product type, and brand. Therefore, attaining sustainability, expanding into other geographies, and reviving domestic demand are essential factors for the vendors. Vendors can boost profits by practicing efficient production techniques that minimize product costs and mitigate associated risks.
- The hand sanitizer market is witnessing unprecedented growth worldwide. Local brands and private labels filling up the demand and supply gaps.
- New entrants from the parallel industries are introducing sanitizers to meet the demand-supply gaps. This, in turn, is declining market prospects of leading vendors.
- India has witnessed about 60% of the new market demand being captured by newly launched brands. These include several FMCG companies such as Dabur, Patanjali, Emami, and Marico.