Numerous factors are affecting the cost of disposable gloves. Soaring oil prices, shipping rates that are expected to in some cases double, and logistics costs from compromised supply chains all add up to distributors potentially paying more for gloves in the second half of 2022.
Inflation is currently the worst it has been in four decades. Since late 2020, the global inflation rate has risen sharply, driven by such supply chain-related factors as raw materials, labor, shipping, and the lower cost of capital.
Rising supply chain inflation impacts every facet of disposable glove production. The majority of gloves are produced in Southeast Asia, which extends the supply chain in terms of timeline as well as geography. Gloves take longer to get to their destination, which means higher transportation costs. Also, because many companies are padding their inventories, both on the supply and demand side, it also increases related sourcing, warehouse, and logistics costs.
It’s a new world for supply chains
Overall, companies must pay more for labor, maintenance, equipment, and insurance. More than that, the days of consistently optimizing the global supply chain for just-in-time inventory by cutting logistical inefficiencies may be gone—or at least on hold. Learning from the impact of the pandemic, companies are building up inventories and adding cushion to transit and processing times. All of this is pushing up costs.
The good news for disposable glove distributors is that no shortfalls of product are expected, at least in the near future. Demand is expected to remain strong.
The market continues to stabilize, a good thing for consumers but also for distributors who are looking to sell more gloves. Price stability will create opportunities to bid on business. Overall, most analysts expect demand for disposable gloves in North America to continue growing at rates of 10% or more, as it has been averaging for over 40 years.
We have the gloves your customers need
AMMEX is in a great position in terms of glove availability. It has substantial inventory, especially of Gloveworks nitrile with Raised Diamond Texture, with more on the way. Now is a fortuitous time for distributors to emphasize RDT in their offerings.
The market is not returning to pre-pandemic pricing, now or in the near future. Anticipating your customers’ needs and buying accordingly will allow you to maintain an inventory level that provides essential flexibility. Increased inventory levels will help distributors leverage market penetration.
Connect with AMMEX and let us help you secure more business.