15 months ago the WHO declared the COVID-19 outbreak a pandemic. All states around the world went to high alert. The demand for PPE and medical devices skyrocketed worldwide. Many new companies ventured into this industry and the market turned into a literal battleground. Desperate endbuyers tried to find real sources, and overzealous brokers swarmed and ravaged the fragile supplychain to secure themselves a chunk of commission.
Now this seems to cool down a little bit. Brokers are leaving the industry, and we can also see that the demand and prices are in a steep decline with new brands and manufacturers coming into the play. So with all this in focus, we will attempt now to predict where the market is headed for 2021. Please consider that these are only predicitons based on our experiences in the market.
Brokers will die out eventually
Maybe many of you (especially brokers) won’t like this prediciton, however that’s the truth. Based on our experiences we see that brokers are more of an obstacle rather than an advantage for the supply chain. Therefore the concept of a PPE broker will eventually become obsolete. Why? Because sellers and buyers got to know each other eventually, and there are now targeted platforms to facilitate these introductions. And believe me when I say, an online platform has way more to offer than a brokerchain.
Obviously this “extinction” will take time, but eventually in a year or so most of the brokers will move on to other industries or go back where they came from – the phantasyworld where they “facilitate” multibillion dollar deals for Bitcoin, Oil, Cannabis, SBLCs, and commodities.
Global demand will turn local
As of today almost 3 billion people have received their vaccine against COVID-19 (source: John Hopkins University). That means that we are on a slow way to recuperate from the pandemic, yet this will take a long time. And knowing that the vaccines don’t give a guaranteed protection against the various mutations of the virus, there will be minor, local outbreaks. The demand for PPE will shift from “global” to the regions where the cases are on the rise. Obviously there will be still a global demand, but not as big as it was a year ago… but this also means that local suppliers will have better chances to sell products, depending on their location.
New regulations to come
The European Union already introduced it’s new Medical Device Directive, and I’m sure that after the frenzy from last year many other states will follow. This means that companies working with medical devices will have to submit an application to their local authorities. There is a very simple reason for this: accountability. And by that I mean that the companies in the supply chain have to be held accountable. Not just because of the many scams – along with other nasty incidents with faulty products or illegally imported goods. And let us be honest, after seeing how inexperienced, naive people and bad actors combined with an unprecedented demand brought this industry almost to it’s knees, I really welcome all kinds of regulation.
And what products will be trending?
At the beginning of 2020 the big hit were facemasks. Afterwards nitrile gloves. And now with the vaccination programs going on the trending products are syringes and needles. After this we would forecast that the next sensation will be anything with sanitisation – hand gels, air sanitizers etc. Let me explain why. The world is slowly re-starting itself, but there are many places and situations where one can transmit bugs and germs. Hotel rooms, a restaurant, a taxi, a bus etc. These were obviously not much used during the pandemic, but now people will start to use them again. And the different provider for these will compete with each other – and hygiene is now a very lucrative advantage they can offer for their customers.
These are our predictions for the second half of 2021. Maybe we are too optimistic, but we definitely see signs that the market is moving back to normal. Or better said: we know that things have changed and the times before the pandemic will never return. But we see that the market is regulating itself with new regulations and trends rising, prices stabilizing and the frenzy cooling down.