A Fluctuating Market Due to Inflated Demand for PPE

When the COVID-19 outbreak emerged, the World Health Organization (WHO) urged all manufacturers to increase the production of PPE significantly. Even as manufacturers across the globe ramped up their production capabilities, there were still limitations to the output these facilities could produce a month. As the cases across the world increased and repositories were depleted in a matter of weeks, a global shortage of PPE emerged and left organizations of every size scrambling to find suppliers.

Without a unified plan across healthcare organizations, government agencies, businesses, factories, and vendors became inundated with hundreds of thousands of requests. This inflated demand caused the PPE market to become the wild west of material shortages, increased production and shipping delays, and the cost per unit to dramatically increase. For example, before COVID-19, N95 masks were $1 per unit and have now seen an 800% price increase.

While these are market shifts no one could’ve prepared for, they have long-lasting implications. As new guidelines are released weekly on what the requirements will be for states and businesses to reopen, items such as masks, gloves, and sanitizers are expected to stay in high demand with a CAGR of 20%. This means for organizations that are looking to stock up or prepare for a potential second wave is that they need to put their plans in motion now.

A solidified PPE strategy is necessary for healthcare organizations, government agencies, and companies for a safe and successful return to the market.

By playing the waiting game, businesses are only going to contribute to the dramatic fluctuations in the PPE market. By establishing a plan to have a consistent flow of inventory over the coming months, companies can stabilize demand for factories and vendors for less uncertainty in pricing and timelines. This also means that businesses will have a real supply chain strategy in place that helps protect against a shortage if a second weave were to hit.

Download the State of the Market to learn more about shifts in all supply chains

Written by Lizzie Sessa


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