EXPORT MARKET RESEARCH CENTRE

Potential for Growth

PORT
EX
GUIDE

Specific areas that toilet paper

manufacturers can look at...

Ideal Markets for Manufacturers

What potential markets
can local exporters explore?

Threat to the Toilet Paper Industry

How can manufacturers overcome
this threat?

DECEMBER 2013

ISSUE 3

A MARKET REPORT ON

The Toilet Paper Industry

The tissue market is one of the fastest growing segments of

sales up 2% in 2012. Portugal has also experienced sales

the paper industry. Globally, the average annual growth from

growth, where Renova introduced what they claim to bethe

2000-2007 has been 3.6% for tissue compared with 1.8% for

sexiest toilet paper on Earth which is black toilet paper.

printing and writing grade paper.

The industry is estimated to have a 4% annual global growth

and an $80billion turnover.

Tissue production growth closely follows the increase in GDP

and higher standards of living. The markets growth was

Tissue World is the most important annual congress forthe

hampered by the recent economic recession, but the industry

soft hygienic tissue paper business.

outlook is still positive largely due to continued growth in the

emerging markets. Tissue paper appears to be one of the few
gleams of light in a relatively gloomy European market. In

In Tissue World, lavatory paper is

Spain for instance, tissue paper is one of a handful of indus-

mournfully described asa commodity

tries experiencing growth during the current recession, with

product distinctly lacking in glamour.

However, the industry must find ways
of maintaining acceptable profits
in the current environment of
consistently increasing cost of fibre and
energy, more stringent environmental
regulations and consumer demand for
higher quality at a lower price.

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GLOBAL IMPORTS OF TOILET PAPER

USD 000
4,000,000
3,000,000
2,000,000
1,000,000

2003

2004

2005

2006

2007

2008

2009

2010

YEARS

A MARKET REPORT ON

The Toilet Paper Industry

CONTD

There are approximately 177 exporting countries of toilet paper

worldwide. The top 10 exporters are as follows: Germany, USA,
China, Italy, Canada, France, Sweden, Poland, Egypt and the
United Kingdom. They account for approximately 11% of total
toilet paper exports. Trinidad and Tobago currently exports toilet
paper on the international market and is ranked 57th out of 161
countries. Trinidad and Tobago accounts for approximately
0.09% of total toilet paper exports worldwide.
The top importing countries of toilet paper are: USA, Germany,
Canada, France, Norway, Denmark, Hong Kong China,
Netherlands, Austria and Ireland. Together these 10 countries
account for approximately 10.47% of total imports for 2012.
There are approximately 226 countries that import toilet paper,
Trinidad and Tobago is also an importer of toilet paper and in
2012 T&T had an import value of US1.3 million. This import
value has been increasing over the years with an approximate
increase in the import value of 400% from 2003 to 2012.
In response to the growing trends in innovation, companies are
starting to take on significant risks to develop new products
which are able to target new market segments. The toilet paper
industry is an industry of major growth and potential but
requires in-depth research and development. This will allow
manufacturers to tap into the niche markets which are the
emerging and the profitable segments of the industry. It is
important to ensure that local manufacturers are on par with the
latest trends and developments which will enable them to
secure new opportunities as they arise and are not left in the
dark. If you think that there is nothing else innovative that can
be done with toilet paper you would be wrong.

2011

2012

Source: ITC Trade Map

Differentiating Factors
to Consider:
1.MARKET SEGMENTATION
Manufacturers can produce different types of toilet paper to target
various segments of the market that is low income and high income
customers. In the United States, recycled-content toilet paper is
viewed as a lower-end product (pardon the pun) sold in discount stores
like Walmart and Target. Millions of Americans use rougher, high
recycled-content toilet paper when they venture into office buildings,
sports venues, movie theatres, and restaurants the so-called awayfrom-home market and are none the worse for the experience. Still,
US manufacturers every year spend millions of dollars example
Kimberly Clarke committed $25 million to its promotions in 2008 to
convince consumers that ultra-softness is a characteristic worth paying
for, and that more expensive, virgin fibre toilet paper is what delivers
that benefit .
Additionally, customers are becoming more quality oriented due to rising
disposable income of the middle class. The introduction of a 2 ply and
later a 3 ply toilet paper tissue is an alternative to the 1 ply product,
shifting the focus from quantity to quality in terms of user comfort.
Therefore, manufacturers can tailor their products to the
specific markets. In markets where there is a high level of disposable
income manufacturers can target customers with high end toilet paper
products to appeal to the markets needs. Similarly, in countries with
low level of disposable income customers will be interested in a
product that satisfies their needs at a low cost. This is important to
ensure that the right customers are targeted to ensure the success of
the products being sold in the right market.

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Differentiating Factors
to Consider:
CONTD

2. PRODUCT INNOVATION
Some product innovations spontaneously become growth drivers
and add value to a category because they respond in a natural
way to the needs of the end users by providing more quantity,
more quality, and more comfort. This often is the case with the
introduction of new or upgraded products in a quickly developing
new market.

TUBELESS TOILET PAPER - There are not many exciting

developments in the toilet paper industry. However, companies
are trying to change that with Tube-Free, a line of tube-free
toilet paper. Not that exciting, you say? Consider this:
Kimberly-Clark estimates that the
17 billion toilet paper tubes produced
each year in the U.S. generate
160 million pounds of trash, or enough
tubing to stretch over a million miles
when placed end to end. Manufacturing
tubeless toilet paper is not as easy as
it sounds but the process is similar to
the special winding process utilised
in the manufacture of bath tissues. This is just the latest in a
series of moves made by the toilet paper giant to appease its
environmentally aware detractors.

Travel size toilet paper or on the go toilet

paper rolls are becoming very popular.
It is a new market with major potential ...
TRAVEL SIZE TOILET PAPER - Away from home (AFH) toilet
paper category has experienced growth in this area of 0.9%
compounded annual growth rate between 2000 and 2010
based on Euromonitor
reports. Travel size toilet
paper or on the go toilet
paper rolls are becoming
very popular. It is a new
market with major potential
for local manufacturers to
enter into and capture new
market share.

Though it is a little costlier than the

normal toilet paper, many people do not
hesitate to buy it and place it at offices
or homes, as they impart a characteristic
fragrance and appear beautiful.

COLOURED AND SCENTED TOILET PAPER - The coloured

toilet paper has been in use for a very long time. In the past
30 years, many companies have started manufacturing the
coloured toilet paper. These papers are not only colourful but
also have a wonderful fragrance, associated with it. Though it
is a little costlier than the normal toilet paper, many people do
not hesitate to buy it and place it at offices or homes, as they
impart a characteristic fragrance and appear beautiful.
It is important to be aware that the coloured toilet paper uses
certain scents and dyes that can be potentially harmful to
human beings. The Food and Drug Administration (FDA) has
gathered a lot of evidence against the ill effects of these dyes.
From the studies conducted in the cosmetics industry, it was
found that these dyes are carcinogenic (cancer causing
agents). Since these dyes are highly dangerous they have
been banned from usage in some countries. Some companies,
however, continue to incorporate these cheap dyes their
coloured toilet paper.

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Potential Market
Toilet paper is an extremely competitive market based on the number of
countries that manufacture toilet paper worldwide. Exporting toilet paper
to the US and UK maybe a very difficult and extremely competitive task
as these markets are dominated by the leading manufacturers such as:
Georgia Pacific, Kimberly Clark, Procter and Gamble, Marcal and SCA.
Most of these companies products are found on the shelves in Trinidad
and Tobago, making the domestic tissue sector highly competitive.
A potential market for Trinidad and Tobago toilet paper manufacturers to explore is Venezuela. Venezuela is an ideal market for manufacturers to enter because of the shortage of house hold products including
toilet paper that the country is currently experiencing. After years of
economic dysfunction, the country has become accustomed to shortages
of medicines and basic food items like milk and sugar but the scarcity of
bathroom tissue has caused unusual alarm. Venezuelans scrambled to
stock up on toilet paper despite the socialist government's promise to
import 50 million rolls. This will allow manufacturers to enter into a new
market by satisfying the shortage that the country is currently facing.
Manufacturers will also benefit from the trade agreement between
CARICOM and the government of the republic of Venezuela on Trade
and Investment. The tariff rate applied to paper products including toilet
paper is 0%. Based on ITC Trade Map data for Venezuela imports of
toilet paper has been increasing over the years. Using 2002 as the base
year there has been approximately 1400% increase in demand. In 2011
Trinidad and Tobago accounted for 7.4% of Venezuelas imports of this
product. Venezuelas biggest exporter is Columbia accounting for 91.9%
of the countrys import of toilet paper. Although this is a small market, it
will provide Trinidad and Tobago manufacturers with an avenue to
export their product and increase their brand awareness.

An alternative that local toilet paper manufacturers can use to

overcome this threat is to use recycled paper. Recycled paper is
paper that contains fibre from waste paper. However, there is no
universal agreement on the exact definition of this. The Paper Users
Environmental Forum Checklist states that recycled paper should
include as high a proportion of post-consumer waste fibre as possible.
Post-consumer waste is paper that has already been used for its final
and intended purpose. Recycling paper comprises of not only collecting
wastepaper, but also using paper with recycled contents. Toilet paper
with high-recycled content is neither expensive nor difficult to obtain. It
provides a second use for recycle paper materials and paper fibres can
only be recycled a few times so tissue is a good final use. There are
also many benefits to a company from using recycled paper apart
from their social responsibility to the environment and these include
the following:
Recycled paper uses 50% less water in manufacturing.
Recycled paper uses 40% less energy in manufacturing.
The United States Environmental Protection Agency? (EPA) has
found that recycling causes 35% less water pollution and 74% less
air pollution.
Recycled paper does not need re-bleaching; NO toxic dioxin and
chlorines.
With all his evidence, its clear that recycled paper has major benefits to
manufacturers and the environment at large.

Conclusion

Threats

The toilet paper industry seems to be an industry with huge

potential and growth. It is important for local toilet paper
manufacturers to stay abreast of industry trends and developments, remain competitive and one step
ahead of their competition. It is, therefore,
important for manufacturers to engage in
intensive research and development to
meet the changing needs of customers.

There is one main threat to the toilet paper industry both in Trinidad and
Tobago and worldwide and this related to its environmental impact.
Five years ago, this type of eco-friendly accreditation would have had
negligible impact. But, times have changed and companies are now
scrutinised by customers and environmental activist via social media
sites and the blogosphere. It is important for companies to show their
social responsibility to the environment by reducing its carbon footprint.

Customers are now becoming environmentally sensitive and are looking for products
which reflect their belief. This can be done
by using recycled paper in the manufacturing process; this helps companies to promote their social responsibility while producing a product that is cost effective.

Eco-friendly accreditation will bring sustainability to the forefront of the

strategic debate in North America's toilet paper market, and that is likely
to filter into other key Western markets as well. This would be a positive
development for the market as a whole, because it needs a new
injection of innovation to drive it forward. The product's biodegradable
capacity could be the unlikely catalyst to catapulting new investment
into AFH tissue, ramping up the competitive environment and bringing
about more significant incremental growth.

C ONTACT US
research@exportt.co.tt

623-5507 ext. 380, 412

There is also the need to differentiate your companys product

from the various brands on supermarket shelves around the world.
This can be accomplished in a variety of ways including tubeless
toilet paper, coloured paper and travel size toilet paper. These are
just some of the many approaches that toilet paper manufacturers
can engage in to remain ahead of the competition and become a
force to be reckoned with.

For more information on the Toilet Paper Industry or any other industry
please contact us at the EMRC. We would also be interested in getting
feedback on this bulletin and suggestions of topics for future bulletins.