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SOI 2020: PPE Has Been Promo’s Lifeline

PPE sales have sustained many industry companies through the pandemic. That could continue in the months and years ahead.

After 43 years in business, Bert Williams was at the end of his rope.

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Event cancellations, business shutdowns and frozen marketing budgets largely wiped out sales of traditional promo products. His company, Tucson, AZ-based Williams & Associates (asi/360450), saw sales drop 50% in March and then 70% in April. Vowing to keep his team employed, he had to figure out a way to offset the costs.

PPE

So, he went the crowded path of selling personal protective equipment (PPE). His company received 30,000 masks and sold out of them in four days. Next, he ordered 100,000 masks and sold them all in a week. He couldn’t stock up fast enough to meet the never-ending demand.

“Once you run out of inventory, it’s a pain in the butt to catch up and keep track of orders coming in you don’t have merchandise for,” Williams says. “But we’re giving everything we can. I’ve even ordered lawn signs like politicians put up during elections, letting people know that Williams & Associates is Tucson’s PPE headquarters.”

As overall industry sales fell and traditional promo sales plummeted this spring, PPE has provided a lifeline to the entire industry. “It sounds crazy, but we had a record month in May,” says Larry Cohen, president of Axis Promotions Powered by HALO (asi/356000), owing the increase to sales of PPE.

Distributor PPE Chart

Finding PPE: As distributors pivoted to selling PPE, eight in 10 had to establish new relationships with suppliers, many of which are located overseas.

A cadre of high-profile apparel manufacturers joined a national consortium that redirected production capabilities to produce millions of face masks for healthcare professionals as part of a contract with the federal government. Other suppliers have followed their lead, even partnering with manufacturers outside the industry to produce PPE. The demand has spurred distributors – ranging from mom-and-pop operations to Top 40 firms – to incorporate the products into their sales efforts, sourcing from both stateside industry suppliers and directly from factories in China.

The pandemic has also disrupted the industry’s top product categories. Throughout the spring, PPE items were by far the most searched for, according to data from ESP. Nine of the top 10 items searched for in May were PPE products, including face masks, hand sanitizer, neck gaiters, face shields and no-touch tools. From May 2019 to May 2020, ESP searches for masks increased over 40,000%.

“The rise of searches in ESP for sanitizers and PPE products is unprecedented,” says Nate Kucsma, ASI’s executive director of research and corporate marketing. “In the span of a few weeks, promo products that our industry was built on, and made up billions of dollars in business, were supplemented by products that, in many cases, were just blips on the screen. The ability of this industry to pivot as quickly as it did to provide PPE products, and judging by the numbers, a lot of companies did, is unparalleled and should enable many them to come out of this stronger than in other industries.”

However, success with PPE has varied, and not every firm has generated significant sales of the products. “PPE is like chasing your tail,” says Chance Castellucio, EVP of sales at Park City, UT-based PromoLeaf LLC (asi/300534). “You have to go to so many places to source it. And when you finally do, either inventory runs out or your client has moved on to the next thing.”

Castellucio has coined the PPE frenzy “handsanity.” One week he’ll get 30 calls for hand sanitizer, and the next week it’s bandannas. The week after that, it’s thermometers. “I’d like to stay with my core book of business,” he says. “I want to stick to selling products that promote company goals and culture. I’m not interested in pivoting to ride the PPE wave.”

Supplier PPE Chart

A New Category for Suppliers: Just 12% of promo suppliers were selling PPE before the coronavirus crisis. Now? More than half plan to incorporate it into their ongoing product assortment.

Axis’ Cohen has seen a shift with PPE demand. “We’re getting more business-oriented PPE sales than the panic-oriented buying we were getting before,” he says. “Buyers are being more deliberative about how they’re going to use it and what they’re using it for, as opposed to before when it was a frenzy and people were just buying to make sure they got stuff.”

Distributors like Williams are happy to ride the PPE wave. Before the pandemic, his company already sold hand sanitizer, gels and lotions. Branded masks are a welcome addition to his regular offering even after social distancing restrictions lessen. He’s currently targeting gyms, college sports, auto dealerships and other potential markets that may need logoed masks for reopening. “I’m thinking of keeping maybe half a dozen PPE products,” Williams says. “Will they be popular a year from now? I don’t know. Six months from now? I think so.”

Hot Products That Aren’t PPE

Along with masks and hand sanitizer, these promotional products have seen a rise during the pandemic.

Pens
Concerns remain about how the coronavirus spreads, specifically through touching of shared physical objects. Because of that, in places where things need to be signed (think restaurants and retail stores), pens are being given away to customers once they use them.

Signage
To reopen, stores and restaurants must enforce strict social distancing policies among customers. Signage in a variety of forms – from wall signs to floor stickers to counter displays – is essential to notify patrons of those rules and keep everyone safe.

Games
With children home from school, parents are looking for fun things to keep them occupied. That’s why there’s been an uptick in board and lawn games, coloring books and other family-friendly activities. Don’t forget puzzles – they jumped 163% in ESP searches this past April compared to April 2019.

Self-Care
With front-line workers needing to unwind and others having extra time at home, distributors have been selling self-care packages filled with bath salts, candles, lotions, lip balms, hot and cold packs, stress balls and other personal care products.