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Promo’s PPE Orders Could Rise Again

The uptick is looking likelier now that the CDC is poised to recommend indoor mask mandates, even for those vaccinated, due to the highly transmissible Delta variant of COVID-19.

Just when it looked like the COVID-19 pandemic was in the rearview, society has hit another roadblock.

The Centers for Disease Control and Prevention is expected to recommend on Tuesday, July 27, that even vaccinated Americans wear masks indoors in certain circumstances due to the Delta variant driving a surge in coronavirus cases across the United States. Several cities, such as Los Angeles, St. Louis and Savannah, GA, had already reinstated indoor mask mandates over the past week.

PPE sketch

In promo, it’s anticipated that the CDC announcement will renew interest in personal protective equipment (PPE), which served as a lifeline for the promotional products industry last year. According to Counselor State of the Industry data, PPE accounted for 25.6% of all industry sales in 2020 – a total of $5.3 billion.

Still, as mass vaccination occurred and government-imposed restrictions lifted throughout the country in 2021, PPE orders went from a mad rush to merely trickling in. Two months ago, PPE failed to make the top 10 list of most-searched items in ESP – ASI’s database of products from around the promo industry – for the first time since January 2020. PPE has remained out of the top 10 since. But now face masks, hand sanitizer and other forms of PPE could be in demand once again.

Top 40 supplier Gemline (asi/56070) has already seen an uptick in PPE orders over the past month. “We’re not expecting a surge, but we’re definitely seeing an uptick in both requests and orders,” says Jonathan Isaacson, CEO/chairman of Gemline and Counselor’s 2021 Person of the Year.

During the height of the pandemic, Isaacson spearheaded the firm’s remarkable pivot to PPE, helping put products into the hands of people who desperately needed them, while also saving countless distributors as traditional sales evaporated. “As one customer unfortunately noted, things seem to be ticking up,” Isaacson says.

Top 40 distributor ePromos Promotional Products (asi/188515) has also seen an increase in PPE orders. “We expect the trend to continue,” says Nick Kiefer, chief sales officer at ePromos. “We remain confident in our ability to service and support PPE for our clients, coupled with our strong position to satisfy demand and lead times at ultra-competitive prices.”

Blank Out

Distributors started the pandemic sourcing blank PPE, but the tide shifted toward decorated PPE by the end of the year. The largest distributors, with revenue of $5 million and above, were more heavily reliant on blank PPE (45%).

Percentage of PPE Sold Decorated vs. Blank

Top 40 distributor American Solutions for Business (ASB, asi/120075) has started to receive requests to bid on PPE since educational institutions are looking to stock up for the upcoming school year. Still, sales don’t figure to be as robust as they were in 2020. “We’ve noticed that the usual supply chain for these items has gotten better, so customers don’t really have to come to us for these products as much as they had throughout the previous 18 months,” says Justin Zavadil, president of ASB.

Although PPE is more readily available than it was at the dawn of the pandemic, the ongoing supply chain disruption plaguing promo and other industries is cause for concern, should demand ramp back up as anticipated, thereby straining already highly stressed sourcing networks. When the demand for PPE fizzled out earlier this year, suppliers shifted their focus back to traditional promo products. Many distributors were left with a stockpile of PPE collecting dust in their homes and offices. While some companies donated the surplus, others were willing to sell at a loss just to get rid of it.

“I have clients asking about inventory and whether they’ll be able to get PPE at the volume they did before,” says Larry Alford, vice president of sales at Axis Promotions Powered by HALO (asi/356000). “The supply chain will be a scary thing when it comes to PPE. We’re just going to get this wave of customers needing it and it may take people by surprise.”

Selling Protection

Even in the great PPE rush last year, roughly four in 10 suppliers did not offer PPE of any kind.

Percentage of Suppliers Selling PPE in 2020

As hand sanitizer demand skyrocketed in spring 2020, Top 40 supplier SnugZ USA (asi/88060) went into hyperdrive. Already a leading industry provider of sanitizer, the company ended up deriving over 30% of its sales from the product category. But now it’ll be more challenging to meet that renewed demand, says Brandon Mackay, president/CEO of SnugZ USA. “The supply chain is a massive issue,” he says. “We’re in the process of building all of our reserves in raw materials, containers and packaging supplies.”

More Than Masks

Small, medium and large distributors alike sold masks in relatively equal proportions to their business. But with other PPE items, the large companies were more actively sourcing and selling.

Percentage of Products Sold

Meanwhile, after 16 months of heavy virus restrictions, Canada has been seeing signs of recovery as provinces cautiously reopen. Promo firms anticipate plenty of opportunity for not only traditional items, but also PPE. “With Ontario, our largest province, opening up, we expect a surge of PPE orders from companies due to people returning to work,” says Rocky Singh, COO at Full Line Specialties (asi/199688) in Surrey, BC.

Selling PPE helped Paula Gossett, senior promotional consultant for Geiger (asi/202900), expand her client base into areas like janitorial and operations. Although she hasn’t experienced an increase in orders as of late, many of her customers are still preparing for the safe return of their employees and associates.

“Most of my clients ordered PPE at the beginning of the pandemic and held it for when it was time to reopen,” Gossett says. “I believe that wearing masks will never go away, even when COVID is under control. As in other countries, wearing a mask during cold/flu season will be considered good manners and self-preservation.”