The report segments the global laundry care market on the basis of product type (fabric softeners, laundry detergents, others), on the basis of source type (synthetic, organic, others), on the basis of form type (powder, cake/block, liquid, others) and on the basis of distribution channel (wholesaler/distributors, supermarket/hypermarket, convenience stores, ecommerce, grocery stores, others). According to FMI, the maximum sales will be in e-commerce (CAGR of 6.1%).
The Asia Pacific (excluding Japan) market is expected to exhibit a CAGR of 5.7% through 2027 to reach nearly $36 billion in sales. Meanwhile, Western Europe will grow at a CAGR of 5.4% to nearly $26.7 billion by 2027.
There are many triggers for growth in the APEJ region and Future Market Insights has identified the important ones.
Growing health and hygiene awareness in the region is one reason. As per a DuPonts survey in China, on an average, the sampled population washes clothes five days per week and has 1.5 loads per day. Moreover, hand washing is the most preferred method than machine washing. Another growth factor for laundry is the growing FMCG industry in the APEJ region. For instance, in APEJ region, the consumer spending on household goods such as detergents and personal care items will increase by an average of 8.5% over the next five years. According to India Brand Equity Foundation, Indian FMCG industry is the fourth largest sector in the Indian economy with a market value of US$ 13.1 billion.
It is also found that liquid detergent overpowers powdered detergent. The innovation of liquid detergent and its effect on cleaning supported by the quick and effective results have made it popular amongst the consumers.
Another trend is the innovation in packaging to enhance the safety of laundry care products. The laundry products contain high proportion of chemicals which are harmful for consumption. Companies are focussing to offer innovative and safe packaging to their customers.
Region wise analysis
APEJ market is the largest market in global laundry care market, which is estimated to represent US$ 20,599.8 million, or 27.3% share of the total market in 2017 and US$ 35,809.5 million, or 28.2% in 2027. APEJ market is expected to gain 94 BPS owing to shifting of manufacturing industries to China along with growing penetration of washing machines in developing countries. North America market is estimated to account for 20.6% revenue share of the global laundry care market by 2017 end and is expected to gain 25 BPS in its market share by 2027 over 2017. Latin America market is estimated to account for 8.1% revenue share of the global laundry care market by 2017 end and is expected to lose 29 BPS in its market share by 2027 over 2017.
Past 12 Months were good for the laundry industry
“As we look back at 2017, now and in years ahead, I think we’ll see it as a pivotal time for technology,” said William Bittner, vice president of North American sales for Alliance Laundry Systems. “Our industry is moving from a mom-and-pop business owner focus to one made up of professionals looking for greater management of their businesses. The sheer amount of new payment systems, management systems and other technology to meet the needs of the laundromat owners emphasize the point that wash and dry efficiency is important, but technology will drive our business moving forward.”
“We’re seeing a wide range of payment systems,” stated Karl Hinrichs of HK Laundry, based in Armonk, N.Y. “The traditional card systems are being challenged by phone apps, other payment systems and central control payment systems. It’s an interesting and innovative time for all. We will see who has the financial strength and innovative products to become established players in this competitive market.”
The North American region did face challenges like the 2017 hurricane season that affected the store owners and distributors in areas of Texas and Florida. Fortunately, all of the major manufacturers met that challenge by supporting those impacted, with quick access to crucial replacement parts and equipment, as well as financing packages to help get operators up and running as quickly as possible. Labour costs also continue to be challenging for all small-business owners. Uncertainty over the enforcement of immigration policies is impacting some markets.
According to Hinrichs, apartments and condos are getting more demanding with regard to requiring larger machines and more features for their laundry rooms. observed. They are looking to create mini-laundromats in their buildings. As a result, laundry owners need to counter with full-service options and customer conveniences. Having an attendant in the store will add to the financial burden of smaller stores.
Trends in 2017
One of the major trends in 2017 was a shift in customer expectations. Customers are willing to pay more for an ‘experience,’ versus a transaction.
More store owners are challenging industry norms – going with fixed-cycle pricing on tumblers, new equipment layouts, and greater focus on profit-per-square-foot, versus revenueper revenueper- square-foot. Large capacity washers were more in demand. Wash-dry-fold services with state-of-the-art software platforms continue to grow and are now well established as a part of the industry landscape. Another trend was the proliferation of high-speed, high-extract washers throughout the industry. There have been increased interest in providing commercial laundry services and business diversification. The interesting trends included cloud based payment systems, and internet payment systems to start washers and dryers. The systems also let you know when your wash is done and can even monitor the availability of washers in your store. There has been a tremendous effort by new store builders to invest in high-quality materials.
There is a higher demand for mobile payment options of some kind. While self-service laundry will continue to be strong, the largest segment of the industry, which will continue to grow at probably double-digit rates, is going to be wash-dry-fold.
And many of these current trends can be combined to elicit what could perhaps be considered the industry’s rallying cry of 2017 – “Retool!”
Some renovation trends spreading across the US include new signage with unique branding, LED lighting, modern interior design enhancements and restroom overhauls. Technology is firmly rooted in the vended laundry business, and it’s not going away. Not only laundromat owners, but their customers as well, will continue to demand a higher level of technology, ease of use, multiple payment options, and flexibility.
The experts feel that 2018 will see even more focus on manufacturers providing total management solutions – systems that not only give them valuable machine and operations data, but empower them to engineer marketing tactics tailored to their customers.
The year 2018 will see an increase in existing store remodeling and re-equipping with more efficient machines and alternative payment systems. Consumers may want more than just four white walls in which to get their laundry done. They want a comfortable place to spend a couple of hours a week – where they can get a quality wash experience.
Some of the most fascinating innovations currently influencing the home care space in the US are originating from the packaging side of the industry. At Cleaning Products US 2017, Francisco Paz, market development and value chain manager in the packaging and speciality plastics division of the Dow Chemical Company, presented a session titled “Sustainable Innovations in Flexible Packaging” in which he expounded on some of these packaging-related advances. Due to the reduced transportation costs and other benefits that flexible packaging provides, many home care manufacturers are currently wanting to make greater use of it. However, due to the lack of durability relative to more traditional, rigid home care packaging formats, manufacturers have been hesitant to adopt flexible packaging for some product categories. According to Paz, PacXpert material not only features reduced weight and uses less energy to produce than rigid packaging, but it also offers durability that meets and even exceeds the standards of most rigid packaging formats commonly used in the home care industry today. Although the technology is currently only available in select European markets, Dow Chemical plans to bring this technology to the US soon.
In a session titled “Changing how People Think about Garbage and Recycling”, Tom Szaky, CEO of TerraCylce, spoke at length about ways in which home care manufacturers could better design their packaging to be recycled or reused. TerraCycle, has been extremely innovative in finding ways to reuse “nonrecyclable” packaging at a point in the material lifecycle when that packaging would normally either be incinerated or sent to a landfill. Though flexible packaging formats do often use less energy to produce than rigid packaging, they are almost never recyclable.
Speaking at a session titled “The Direction Laundry Care is Heading in Europe: Rise of the Machines – from Automation and Smart Home to Auto- Alchemy”, Ian Bell, Euromonitor International’s global lead for home care research, highlighted some of the innovations that are currently reshaping the home care industry in Europe. One of these advances is the growing popularity of washing machines that are able to utilise smart technology to determine the amount of laundry detergent that needs to be deployed for a wash load without direct user input. Since this technology helps to prevent laundry detergent overdosing, its uptake could lead to consumers purchasing less laundry detergent and in effect negatively impact the bottom line of laundry care manufacturers. There is a move by some home laundry appliance manufactures in Europe to branch into the home care space by developing their own branded laundry care products, which are specifically designed to be used with their machines. This movement is likely to gather speed, providing an opportunity for OEM laundry care manufacturers, but potentially posing a serious challenge to many of the leading home care brands.