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Wipes Webinar Questions & Answers

June 2009
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  1. Are sales into medical areas (hospitals, surgical centers, dental) included in any of these numbers?
    No. The numbers are strictly consumer wipes.
  2. How exactly are you tracking or estimating Wal-Mart since they and their vendors contract not to divulge them?
    We back into the numbers and crosscheck our results with data provided by industry members. A detailed explanation is provided in the 2008-2013 North American Wipes report which will be released this summer.
  3. What portion of this volume is flushable wipes? Is there data on flushable wipes broken by adult vs. toddler market?
    In North America, my estimates of wipes labeled flushable is $350 million in 2009 (lower than INDA’s estimates).  That includes $240 million for adult moist toilet tissue and $65 million for toddler toilet care.
  4. Baby wipes growth of 2% y-o-y, is this in volume or value?
    Value.
  5. Why are resealable soft packs easier to store [in the] home? In which aspect are they easier than canisters?
    Consumers tell us that they prefer softpacks as they can be stacked, toted, stuffed and tossed under counters, into gloveboxes, in backpacks and pockets—something that is difficult to do with canisters or other types of hard packaging.
  6. What affect did Ian see on the growth of the baby wipes market due to demographics/birth rate?
    The “Boomer Echo” will positively influence the retail growth of baby diaper/wipes. The impact—along with other forces—are explained in the 2008-2013 report.
  7. For clarification, which of these numbers are IRI numbers vs. INDA estimates (that include Wal-Mart, Dollar stores, etc…)?
    Category estimates (e.g., household, baby, etc…) are grossed up to accurately reflect the marketplace. Individual product estimates (e.g., Cottonnelle, Kandoo, etc…) are from IRI.
  8. Are Household wipes suffering from the economic situation? Aren’t they considered as “just convenient” product whereas baby wipes are more “must have”?
    Retail sales are suffering across the board; however baby wipes do have the advantage as they are viewed more as a “must have” and they are often called upon to do double duty as household wipes. A great example of this is the Kirkland baby wipe—mothers are using it on everything from baby’s bottom to sticky countertops.
  9. Please confirm the data in the breakout section (personal, household) is only based on IRI data, not a project of the total market.
    See Q7 for your answer.
  10. How does all this translate into the commercial market?
    The data provided is solely based on the consumer wipes market. Market data and trends for the Industrial/Commercial wipes industry can be found in the 2009-2013 North American Wipes report which will be released this summer.
  11. Is it possible to get information about markets in Latin America?
    The 2009-2013 wipes report examines only the North American marketplace. INDA does have some information on the Latin America market available to its members. INDA Members who purchase the report can schedule an appointment with Ian Butler to discuss.
  12. Flushable wipes- Where will the resistance come from? Who are the regulatory agencies?
    To date, we have not identified resistance and there are no regulatory agencies involved.
    The Netherlands and certain US states (Califormia) already have indicated concerns about all flushable wipes.  Not sure if I would term this resistance.
  13. What kind of pressure can INDA/EDANA apply on the non-flushable” wipes so that they’re changed or removed from the market?
    INDA’s goal is get 100% compliance with the Flushability Guidelines   And thus, only flushable wipes would be labeled flushable.  In an effort to prevent regulation, all the leading manufacturers of flushable wipes worked hard over four years to produce these Guidelines which include tests to evaluate the flushability of a wipe.  We have every confidence that they will comply over a reasonable amount of time. INDA is encouraging wipe manufacturers to label non-flushable wipes with a “no flush” logo.  The “no flush” logo is to help educate the consumer and prevent problems at the waste water treatment facilities.  While INDA can’t apply pressure, we believe that the industry is on board and are applying pressure to themselves.
  14.  Could you elaborate on “low” hydroentanglement? Does this imply that the actual conditions of entanglement are milder or is it reference to fiber length? What is the influence on mechanical or fluid distribution?
    “Low” hydroentanglement  (for Hydraspun) is influenced by three factors:
    • Fiber length (10 mm fiber length vs std 37.5 mm fiber length)
    • Lower pressure water jets
    • Fewer impingements per unit area
    It is the first factor which has the largest effect on this product, though all contribute.
  1. Why is latex bonded airlaid the best overall option?
    Latex bonded airlaid is currently the best option because it is the only option with high “in use” wet strength and low/no wet strength when flushed.  Actual tensile testing shows Cottonelle (latex bonded airlaid) to have about twice the wet strength “in use” of other options, but meets INDA/EDANA Flushability Guidelines.
  2. What kinds of sanctions are present if one doesn’t comply with the flushability Guidelines?  Who will enforce these sanctions?
    We believe that the industry will self-regulate.  As mentioned before, the industry developed the Flushability Guidelines and thus, has buy in.  INDA will work with the industry to encourage and support implementation. In short, there are no sanctions and we don’t believe that sanctions will be necessary. 
  3. What is repurposed/regenerated cotton?
    Repurposed/regenerated cotton is fiber which has been “recovered” from cotton textiles via a proprietary process of Strateline Industries.
  4. Can you explain what processing repurposed/regenerated cotton has received?
    Repurposed/regenerated cotton starts as woven or knit cotton cloth, or scraps of cloth or clothing.  It is processed through a Garnet machine that rips the cloth to shreds and produces a usable fiber for processing into a new fabric.
  5. Why would cotton grow in wipes?
    There are several reasons cotton will grow in wipes; the rate of this growth though will be moderate for other reasons.

    Reasons for growth:

    • Consumer perception
    • Real performance advantages
    • Procter & Gamble participation

    The consumer still believes cotton brings desirable properties to a wipe; whether it really does or not is immaterial.

    Some testing indicates that there are actual improvements I physical properties of wipes with cotton.

    Finally, P&G’s apparent success with Pampers Sensitive makes it impossible for private label baby wipe producers to ignore, and puts
    pressure on Kimberly-Clark to respond as well.  P&G gives credibility to cotton in baby wipes.

    Reasons against growth:

    • Cost of cotton
    • Consumer’s willingness to pay for cotton
    • Process/quality issues with cotton
    • Environmental issues with cotton

    Weighing pluses and negatives, I project cotton’s market share of raw materials used in wipes to increase from a current 2.2% share to 3.0% share in 2014.

  1. Why is coform not expanding in Europe?
    Coform is expanding in Europe, albeit from a small base.  There are other reasons for its lower growth in Europe, including:
    • K-C has only one smaller, older Coform line in Europe (10,000 metric tons/year in Flint, UK)
    • K-C entered the baby wipe market late relative to P&G, J&J, others in Europe
    • Baby wipes in North America were developed using an airlaid nonwoven (Scott); and airlaid survived as the major process technology in baby wipes until the 2000’s.  Europe switched to spunlace as its major baby wipe substrate much earlier (early to mid 1990s).  Airlaid and Coform are more similar than either with spunlace; if a consumer prefers spunlace, then Coform is not as attractive as when that consumer prefers airlaid.
  1. Phil, can you better explain the mix message or your estimations on the use of repurposed cotton?
    The “mixed message” is that while cotton IS a natural, sustainable, renewable fiber, it is frequently attacked “environmentally”:
    • By rayon producers, for its use of water, pesticides, and food growing land
    • By organic cotton, for its dependence on fertilizers and pesticides
    • Bleached and scoured fiber producers are attacked by unbleached fiber producers, for use of bleaching and scouring chemicals, water, etc.

    This “mixed message” to both consumers and retailers makes cotton a not so clear eco-friendly fiber.

    Repurposed cotton is difficult to assess at this point; its cost to produce is estimated as significantly higher than scoured and bleached virgin fiber.  The ability of Strateline to minimize these costs and market this fiber as well as present a clearer environmental message will decide its success.

  1. What are the latest developments in closures/resealable flaps?
    Do not follow.
  2. Phil, do you have any information about Latin America?
    I estimate Latin America (including Mexico) to represent about 5% of the global wipes market (by value).  This will grow to 6.4% of the global market by 2014.  The absolute market value will grow at a CAGR of about 11% from 2009 to 2014.
  1. What percentage of the baby wipe market is private label?
    Approximately 25% of the baby market is PL.  Growth, trends and other data regarding the Private Label market can be found in the 2009-2013 report.
  1. Should latex allergies be a concern with products/processes such as latex bonding?
    No!  Latex allergies are to natural rubber latex; the “latex” used in wipes is either acrylic or vinyl acetate-ethylene copolymer based.  No relation at all, no common raw materials, etc.
  1. Where do you see biggest and most immediate growth opportunity internationally?
    Short term, no region has escaped the current economic slowdown.  Over the next five years, eastern Europe has the highest projected growth rate as a region, followed by South America.  China and India also represent high growth rates for wipes.  Of all of these, China is most likely the fastest to recover from current economic woes.
  2. Of all the wipes being sold, how much of it is wet/presaturated?
    Globally, I estimate 70% of all wipes (by sales value) are wet/premoistened.  I do not project this changing much in the near future.  North America is slightly higher than global average at 72% wet.
  1. Are there technologies emerging that could challenge Swiffer’s electrostatic wipe?
    Not aware of any new threats….market itself is slowing, especially in Europe with some countries showing low/no growth.
  1. Wouldn’t health/testing standards be a barrier for manufacturing in China or anywhere else abroad?
    Not necessarily.  Substrate production (most likely), then shipping to North America or Western Europe, then converting into wipes avoids this. 

    Substrate producers do not have direct (EPA, FDA) requirements normally.  Since most lotions are 99% water, why pay to ship water?

    China is NOT incapable of meeting EPA or FDA requirements as well.

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