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UL Product Mindset Industry Report Household Chemicals
UL Product Mindset Industry Report Household Chemicals
UL Product Mindset Industry Report Household Chemicals
UL Product Mindset Industry Report Household Chemicals
UL Product Mindset Industry Report Household Chemicals
UL Product Mindset Industry Report Household Chemicals
UL Product Mindset Industry Report Household Chemicals
UL Product Mindset Industry Report Household Chemicals
UL Product Mindset Industry Report Household Chemicals
UL Product Mindset Industry Report Household Chemicals
UL Product Mindset Industry Report Household Chemicals
UL Product Mindset Industry Report Household Chemicals
UL Product Mindset Industry Report Household Chemicals
UL Product Mindset Industry Report Household Chemicals
UL Product Mindset Industry Report Household Chemicals
UL Product Mindset Industry Report Household Chemicals
UL Product Mindset Industry Report Household Chemicals
UL Product Mindset Industry Report Household Chemicals
UL Product Mindset Industry Report Household Chemicals
UL Product Mindset Industry Report Household Chemicals
UL Product Mindset Industry Report Household Chemicals
UL Product Mindset Industry Report Household Chemicals
UL Product Mindset Industry Report Household Chemicals
UL Product Mindset Industry Report Household Chemicals
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UL Product Mindset Industry Report Household Chemicals

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  • 1. NAVIGATINGTHE PRODUCTMINDSETHOUSEHOLD CHEMICALSINDUSTRY REPORT
  • 2. INTRODUCTIONUL has launched a global study, Navigating the Product Mindset, that features PRODUCT STUDY KEYmarketplace trends, statistical data, differing stakeholders, varied geographies, diverseindustries and a technical panel of UL experts. This report presents the key findingsrelated to the household chemicals industry. It is based on 2,430 quantitativeinterviews with manufacturers and consumers across a range of significant export Quantitative data: blue indicatesand import markets — China, Germany, India and the United States. manufacturers.Navigating the Product Mindset and its additional industry reports seek to betterunderstand market forces; drivers of decisions; findings related to safety, performance,sustainability and innovation; and the motivations behind these views. Quantitative data: green indicates consumers.To read the full study, go to ul.com/productmindset. U.S. CHINA INDIA GERMANY Flags indicate specific geographic results.HOUSEHOLD CHEMICALS 2
  • 3. Manufacturer findingsHousehold chemicals 3
  • 4. Findings Snapshot• Household chemical manufacturers express confidence in their job performance related to product safety, product innovation, sustainability and reliability. Only 2% of manufacturers feel that their company is behind the curve regarding product innovation.• Rising costs are the biggest supply chain challenge. Consistent product quality is the supply chain consideration with which manufacturers are most satisfied.• Product reliability has the largest impact on household chemical manufacturers’ ability to successfully compete in the marketplace today. In the future, manufacturers believe product innovation will be their most important consideration.• Manufacturers believe they are responsible for ensuring product safety, not government agencies, consumer agencies or retailers. They also feel that it is their job to communicate key product safety information to consumers.• Household chemical manufacturers agree consumers are becoming more empowered and commanding greater influence across the supply chain.• More than 40% of household chemical manufacturers agree there is a direct relationship between product quality and country of origin.• Today, 68% of manufacturers consider environmentally friendly products profitable or somewhat profitable. Notably, Chinese and Indian household chemical manufacturers are the most optimistic about environmentally sound products being profitable, while U.S. manufacturers demonstrate the largest concern in this area.HOUSEHOLD CHEMICALS 4
  • 5. HOUSEHOLD CHEMICAL manufacturers are confident IN their performance In general, manufacturers consistently rank their company performance higher than that of their industry. Household chemical manufacturers rank themselves highest in terms of being ahead of the curve in product safety, innovation and reliability. They are least confident regarding their performance in product and operational sustainability. Company Industry 60% At or ahead of 45% At or ahead ofINNOVATION PRODUCT the curve the curve 38% At the curve 44% At the curve 2% Behind the 11% Behind the curve curve Company Industry 60% At or ahead of 50% At or ahead ofPRODUCT the curve the curve Safety 38% At the curve 43% At the curve 2% Behind the 7% Behind the curve curve Company Industrysustainability 42% At or ahead of 38% At or ahead of PRODUCT the curve the curve 51% At the curve 54% At the curve 7% Behind the 8% Behind the curve curve Company Industrysustainability OPERATIONAL 38% At or ahead of 36% At or ahead of the curve the curve 53% At the curve 54% At the curve 9% Behind the 10% Behind the curve curve Company Industry 62% At or ahead of 49% At or ahead ofreliability PRODUCT the curve the curve 34% At the curve 47% At the curve 4% Behind the 4% Behind the curve curve HOUSEHOLD CHEMICALS 5
  • 6. Rising Costs ARE the largest supply chain challenge for HOUSEHOLD CHEMICALmanufacturersRising costs are the most significant supply chain challenge for household chemical manufacturers.This issue points to the continuing challenges of profitability.Biggest Supply Chain Challenges Rising costs/Price fluctuation 17% Availability of raw materials 11% Timely delivery 11% Quality 6% Competition 4%Biggest Supply Chain Challenges: GEOGRAPHIC DETAILSInterestingly, rising costs are particularly a concern among Chinese and U.S. manufacturers, while Germanmanufacturers note timely delivery as their more significant supply chain issue.Rising costs/Price fluctuation Availability of raw materials 24% 16% 20% 12% 11% 8% 10% 8%Timely delivery Quality 29% 7% 7% 6% 6% 6% 1% 4%Competition 6% 6% 2% 2%HOUSEHOLD CHEMICALS 6
  • 7. Manufacturers are most satisfied with quality and on-time deliveryHousehold chemicals manufacturers feel most confident in their ability to manage consistent productquality and on-time delivery. They ranked these as the two best-performing aspects of their supply chain.Manufacturer Supply Chain Satisfaction Consistent product quality 84% On-time product delivery 73% Ability to manage risk in an increasingly complex marketplace 53% Managing costs 48% Reducing redundancy in your company’s supply chain 45%Manufacturer Supply Chain Satisfaction: GEOGRAPHIC DetailsChinese household chemicals manufacturers tend to be most satisfied with the performance of theirsupply chain, while U.S. manufacturers consistently express the lowest levels of satisfaction.Consistent product quality On-time product delivery 91% 84% 87% 74% 83% 68% 73% 63%Ability to manage risk in an increasinglycomplex marketplace Managing costs 62% 53% 59% 51% 50% 49% 40% 38%Reducing redundancy in your company’s supply chain 52% 44% 44% 38%HOUSEHOLD CHEMICALS 7
  • 8. Product Reliability and Safety are priority considerations for HOUSEHOLDCHEMICAL manufacturerSProduct reliability and product safety are the top considerations that impact manufacturers’ abilitiesto effectively compete in the marketplace. Notably less significant is outsourcing to developing countriesto contain manufacturing costs, even though rising costs are a key supply chain challenge.Top considerations impacting MANUFACTURERS’ ability TO COMPETE Product reliability 91% Product safety 90% Product innovation 82% Operational sustainability 80% Using environmentally friendly packaging 77% Designing sustainable products 77% Speed to market 75% Outsourcing to developing countries to contain costs 47%Product Reliability is the Key Factor in Manufacturer SuccessWhen asked to select only one key factor, household chemical manufacturers chose reliability as the single mostsignificant consideration related to their business success. This suggests the essential importance of a productworking as expected to this segment.Most important consideration impacting manufacturers’ ability to compete Outsourcing to developing countries 2%Using environmentally friendly packaging 4% Operational sustainability 8% Speed to market 8% 26% Product reliability Designing sustainable products 12% 21% Product innovation 19% Product safetyHOUSEHOLD CHEMICALS 8
  • 9. Manufacturers feel it is their job to communicate product safetyinformation to consumersHousehold chemical manufacturers identify themselves as the primary stakeholder responsiblefor providing and communicating safety information to consumers.Who is responsible for communicating key product safety information to consumers? 84% 28% 20% 19% AGREE AGREE AGREE AGREE Manufacturers Retailers Government Independent safety organizations88 % of HOUSEHOLD CHEMICAL manufacturers agree product safety is becoming more important.HOUSEHOLD CHEMICALS 9
  • 10. For Household chemical Manufacturers, Innovation Leads TomorrowForecasting a few years into the future, product innovation is of key importance and product reliabilityremains significant to household chemical manufacturers.Future Consideration Most Important in Impacting Your Company’s Ability to Compete Outsourcing to developing countries 5% Speed to market 5%Using environmentally friendly packaging 6% 31% Product innovation Operational sustainability 8% Product safety 11% 21% Product reliability Designing sustainable products 13%Future Consideration Most Important in Impacting Your Company’s Ability to Compete:GEOGRAPHIC DETAILSIt is notable that German household chemical manufacturers are more concerned with product safety thanare manufacturers in China, Germany and the U.S. Additionally, product innovation seem to be prioritizedhigher by German and Chinese manufacturers relative to their U.S. and Indian counterparts.Product innovation Product safety 40% 18% 36% 90% 10% 157% 27% MORE 8% MORE 21% 7%HOUSEHOLD CHEMICALS 10
  • 11. Manufacturers Are Responsible for Product SafetyManufacturers see themselves as responsible for ensuring the safety of household chemical products.While other stakeholders are seen as contributing to product safety, the onus clearly lies with themanufacturer. Additionally, manufacturers are more likely to hold those manufacturers that assemblethe final product versus those that create ingredients as primarily accountable for safety.most responsible for product safety Manufacturers that assemble final products 65% Government agencies 10% Companies that manufacture components/ingredients 10% Independent safety testing organizations 4% Consumer agencies 4% Distributors/retailers 4%HOUSEHOLD CHEMICALS 11
  • 12. HOUSEHOLD CHEMICAL manufacturers agree consumers are becomingmore empowereDConsumers are increasingly gaining influence and effectively getting their voices heard across the globalsupply chain. Manufacturers clearly see consumers commanding greater power and becoming more informed.Manufacturers Strongly Agree 82% 81% 79% 77% AGREE AGREE AGREE AGREEConsumers are requesting Consumers are becoming Consumer confidence Consumers are demanding more safety information more aware and better in product safety is more eco-friendly products about products educated about products increasing at the same cost as in general non-eco-friendly productsMANUFACTURERS Believe THEIR OWN Claims are the Most ValuableManufacturers of household chemicals express a strong degree of confidence in their own endorsementsand rank them as the most valuable type of claim. They consider claims made by consumers as the nextmost valuable type of endorsement. Building materials, food and high-tech manufacturers all selectedconsumer claims as the most important.Most valuable party making a claim about your product Self-claims 86% Consumers 84% Independent safety certification companies 79% Independent companies regarding performance verification 78% Government agencies 77% Retailers 74%HOUSEHOLD CHEMICALS 12
  • 13. Manufacturers agree that country of origin has a strong impact onproduct qualityManufacturers believe there is a relationship between raw materials, chemical compounds and formulatedproducts and the importance of the country of origin. Chemical manufacturers in the U.S. do not perceive theseissues to be as impactful, while those in India place greater importance on the source country of chemicalcompounds and raw materials.Impacting Product Quality 46% 44% 40% AGREE AGREE AGREE Country of origin of Country of origin of Country of origin of raw materials chemical compounds formulated productsNearly half of HOUSEHOLD CHEMICAL manufacturers will increase sourcingfrom other countries over the next five yearsAdditionally, for the vast majority of manufacturers, these new countries will be in addition to their currentroster rather than replacing existing sources.Agree over the next five years you will source more frommore countries Agree these countries will be in addition to your current sources 58% 100% 56% 93% 43% 85% 36% 82%HOUSEHOLD CHEMICALS 13
  • 14. An Environmental Orientation Can Be ProfitableToday, 68% of household chemical manufacturers consider environmentally friendly products profitableor somewhat profitable. Additionally, 27% of these manufacturers believe that this area will hold a promiseof profitability in the future. Profitable 28% Somewhat profitable 40% Not profitable today, but may be over time 27% Not profitable and do not expect profits 5% in the next few yearsAN ENVIRONMENTAL ORIENTATION CAN BE PROFITABLE: GEOGRAPHIC DetailsNotably, Chinese and Indian household chemical manufacturers are the most positive about environmentallysound products being profitable, while U.S. manufacturers have the largest concerns in this area.Profitable Somewhat profitable 35% 47% 32% 40% 25% 37% 21% 36%Not profitable today, but may be over time Not profitable and do not expect profit in the next few years 29% 15% 27% 5% 26% 1% 24% 0%HOUSEHOLD CHEMICALS 14
  • 15. CONSUMER findingsHousehold chemicals 15
  • 16. Findings Snapshot• Consumers feel that the safety of household chemical products has improved slightly over the past two years.• The primary safety concerns for household chemicals relate to long-term exposure and skin irritation.• Product safety and product performance are priorities for consumers and considered the most important types of information when evaluating a household chemical product such as household cleaners. Additionally, 64% of consumers find it difficult to locate product safety information about these products.• On average, 48% of consumers across all geographies state they are always or usually aware of the country of origin for household chemical products. Additionally, 33% of consumers believe the country of origin of household chemical products will become more important over the next five years.• On average, 65% of consumers feel that it is more important to know the origin of a household chemical product’s materials versus where the product was assembled.• They also think that the product quality of household chemical products is better in developed markets than in emerging countries.• Consumers believe manufacturers can do a better job. They perceive that manufacturers do not take adequate steps to ensure environmentally friendly manufacturing procedures are followed or conduct thorough testing before releasing products into the marketplace.HOUSEHOLD CHEMICALS 16
  • 17. Consumers view HOUSEHOLD CHEMICALS as slightly improving in termsof safety over the past few yearsConsumers in all geographies see household cleaning products as stable or improving in termsof safety. Those in the U.S. see the most improvement. Household chemicals U.S. INDIA GERMANY CHINA Better WorseSAFETY AND PERFORMANCE ARE PRIORITIES FOR CONSUMERSWhen asked about household cleaners as an example of a household chemical product, consumersconsider product safety and product performance the most critical and valuable types of informationwhen evaluating a product.Most Important Types of Information When Evaluating A Product Product safety 37% Product performance 31% Environmentally friendly 11%HOUSEHOLD CHEMICALS 17
  • 18. Consumer safety concerns: LONG-TERM EXPOSURE AND SKIN IRRITATIONWith regard to household cleaning products, consumers are most concerned about long-term exposureissues and skin irritation. Chinese and U.S. consumers are primarily concerned about the former, whileGerman and Indian consumers are more worried about the latter.BIGGEST CONSUMER SAFETY CONCERNS ABOUT HOUSEHOLD CHEMICALS Long-term exposure 26% Skin irritation 25% Interaction with other household cleaning products 12%Packaging safety mechanisms to keep out of children’s reach 11% Fumes 10%HOUSEHOLD CHEMICALS 18
  • 19. It is hard for consumers to find product information on HOUSEHOLDCLEANING PRODUCTSIn general, consumers do not think that product information on either safety or performance is readily available.64Product performance information about household cleaners was considered the most difficult for consumers tofind relative to related information for insulation, fresh meat and fish, and cell phones. % of consumers find household cleaning product safety information difficult to locate.58 % of consumers find household cleaning product performance/ quality information hard to find.Consumers perceive product quality as better in developed vs. emerging marketsConsumers in both developed and emerging nations feel that developed countries produce higher-quality householdcleaning products. Consumers in India and China rate these products higher from developed countries than they dothose made in their own. In the U.S. and Germany, consumers perceive the emerging markets as delivering lower-38quality products. % higher from developed to emerging countries.HOUSEHOLD CHEMICALS 19
  • 20. Awareness of Country of OriginOn average, 48% of consumers across all geographies state they are always or usually aware of thecountry household cleaning products are manufactured in. Additionally, 33% consumers also believethe country household cleaning products are manufactured in will become more important in thenext five years. This is a lower percentage relative to the importance of country of origin over the nextfive years than those for food, high-tech and building materials products.Usually or Always aware of which Country where a product iscountry a household chemical manufactured will become moreproduct was manufactured in important to you 66% 40% 65% 36% 33% 35% 28% 23%Importance of Country of Origin and ingredients to consumersOn average, 37% of consumers think it is important to know the country of origin for each ingredient in a cleaningproduct. They also feel that when comparing parts/ingredients to where the product was assembled, it is moreimportant to know where the ingredients come from. This is particularly true for American and Chinese consumers.Importance of knowing the country IMPORTANCE OF KNOWING WHERE THE PARTS COMEof origin for each individual FROM VS. WHERE A PRODUCT WAS ASSEMBLEDpart/component of the product 54% 74% 26% 43% 72% 28% 27% 64% 36% 22% 50% 50% COUNTRY OF ORIGIN FOR A PRODUCT’S PARTS/ingredients THE COUNTRY WHERE IT WAS ASSEMBLED/PACKAGEDHOUSEHOLD CHEMICALS 20
  • 21. 73Consumers believe HOUSEHOLD CHEMICAL MANUFACTURERS can do a better job % do not believe HOUSEHOLD CHEMICAL manufacturers have taken adequate steps to ensure environmentally friendly manufacturing procedures are followed.69 % do not think HOUSEHOLD CHEMICAL manufacturers conduct thorough product testing before introducing new products to market.66 % feel THAT HOUSEHOLD CHEMICAL manufacturers are not making better products today than FIVE years ago.HOUSEHOLD CHEMICALS 21
  • 22. NAVIGATINGTHE PRODUCTMINDSETin the NewsNavigating the Product Mindset has been recently featured in Time magazine,The New York Times, Fortune and Forbes, among other notable publications.To read the full study, go to ul.com/productmindset.HOUSEHOLD CHEMICALS 22
  • 23. methodologyIn Spring 2011, UL employed an independent researchfirm, ORC International, to conduct a globalquantitative survey among 1,235 consumers and 1,195manufacturers across four countries: China, Germany,India and the United States. To meet the objectivesof the survey, manufacturers across the high-tech, food,household chemicals and building materials sectorswere interviewed by phone and consumers were interviewedthrough an online survey. Manufacturers were director-level and above and specialized in management, researchand development, marketing and sales, quality control,product management, or design. Consumers were arepresentative mix of age, gender, education and income.Data tabulations among subgroups have been tested forstatistical significance at the 90% and 95% confidencelevels. A technical panel was used to provide additionalinsights, and Product Mindset considerations were selectedbased on importance and overall significance of the data.HOUSEHOLD CHEMICALS 23
  • 24. furtherinformationFor more information about this study:Visit: www.ul.com/productmindsetEmail: productmindset@ul.comCall: +1 847.664.2226UL and the UL logo are trademarks of Underwriters Laboratories Inc. © 2012The Household Chemicals Industry Report cannot be copied, reproduced, distributedor displayed without UL’s express written permission. V.9.Household chemicals 24

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