Over the past twenty-five years, toilet paper sales have increased every year, even during this global economic crisis. A major reason for this increase is the growing buying power in developing countries. As this product's sales are projected to “grow roughly on par with GDP,” and because developing countries’ GDPs are projected to increase 6.6 percent in 2021, developing countries are the drivers of new growth in this market.
Companies that can enter this market with innovative solutions to the biggest impediment in developing markets – price, will have the opportunity to create long term profits. Now is the perfect time for toilet paper manufacturers to move into developing markets, grow their brand names, and increase their profits through cost-efficient 100 percent recycled fiber toilet paper.
Over the past twenty-five years, toilet paper sales have grown by 3.7 percent worldwide and have never had a year where sales contracted. Developing countries are driving this increased demand as the compound annual growth rate for the product is greater than 2 percent in Latin America, Eastern Europe, and Asia (excluding Japan).
This growth coincides with an increase in purchasing power in developing countries. By 2030, six of the top eight countries with the largest purchasing power in the world will be developing countries. However, individual buying power in developing countries is still lower than the U.S., meaning that a successful product in a developing country must be cost conscious.
Thus, 100 percent recycled fiber should be used to create an environmentally sustainable lower cost toilet paper. Since recycled fiber is less expensive than using virgin fiber, consumes three times less carbon, and because each unit displaces 1.7 units of wood otherwise used in chemical pulping, a 100 percent recycled fiber tissue paper product will decrease input costs and lower the overall price of this paper product.
A low-cost environmentally sustainable alternative would also be a tremendous advantage to a paper products manufacturer as it would improve its brand name and good will due to the growing consciousness and interest in buying environmentally sustainable products. In addition, the manufacturer would not be constrained by the shrinking supply of virgin fiber as demand for toilet paper increases.
Moreover, recycled fiber toilet paper can continue to be manufactured as environmental regulations become stricter. The EPA has recommended purchasing toilet paper containing at least 20 to 60 percent post=consumer recycled content and 20 to 100 percent total recovered fiber.
Creating a recycled fiber product would position any company ahead of its times, proactively changing before regulations force it to do so, and opening the doors to a large new customer base.
India is the perfect opportunity for the expansion of a low-cost, 100 percent recycled fiber toilet paper. India is the second most populous nation in the world with 1.3 billion people, but its use of toilet paper is minuscule, with the average person only using 6.4 pounds per year. However, the toilet paper market is primed to rapidly expand due to a variety of coalescing factors.
First, the average revenue coming from suchsales, per capita, is projected to increase from $4.46 in 2012 to $6.48 by 2023. Second, the growth rate of toilet paper in India, is projected to average around 4.6 percent from 2021-2023. Third, the development of a middle class in India, along with increased urbanization, is creating a new generation of consumers more open to using and purchasing toilet paper. In addition, with a 51 percent increase in toilet paper sales in India in March 2020, now is the time for the introduction of low-cost 100 percent recycled fiber products in India.
As many Indian consumers view hygiene as an important element in everyday life, but generally view this option as unhygienic compared to washing with water post-bathroom visit. Any 100 percent-recycled fiber toilet paper should be pushed with a strong marketing message regarding the importance of tissue for hygiene purposes. This message should relate the ability to prevent disease by linking the use of toilet paper to better hand hygiene and lower disease transmittal. This message, along with the growing demand of a developing middle-class, will allow for the successful introduction of low-cost recycled fiber tissue in India.
The growing demand for low-cost toilet paper in developing countries, combined with the global increase in hygiene awareness and demand for these products during the COVID-19 pandemic, makes the present moment the perfect time to market 100 percent recycled toilet paper into developing countries.
Image credit: Brian McGowan/Unsplash
Charlie Grosenick enjoys traveling the world to explore how environmentally sustainable solutions can lessen the impact of a growing population. Based in San Diego, Charlie currently works at an environmental remediation law firm and spends his free time working on the BRIGHT Guide creating a guide for developing area-wide redevelopment plans for underprivileged communities. Charlie is a proud graduate of The University of San Diego School of Law and James Madison University.