Karen McIntyre, Editor04.04.24
News this month of two major baby diaper investments in North America (presumably) should be good news for the entire diaper supply chain. Despite economic pressures, competition and lower birth rates, Drylock Technologies and First Quality, two of the biggest names in private label diapers, are proving they remain bullish about the future of the industry.
Even though the companies have different approaches to their businesses, both cited similar reasons for their investments—creating a more sustainable product, focusing on innovation and being closer to their customers.
Drylock Technologies, who will manufacture baby diapers in the U.S. for the first time at its new site in North Carolina, says the move will meet increasing demand for baby care products in North America where it has already been making adult diapers since 2018. Globally, the European company has been on an impressive growth and investment streak, catapulting its sales to surpass $1.2 billion in just a decade. We hope this winning streak will be extended with Drylock’s new U.S. investment.
First Quality, a long-time leader in the North American private label baby diaper category, has not yet announced the location of its investment, saying only that it will add 50% to its capacity and reaffirms the company’s ongoing commitment to the absorbent hygiene market as well as to sustainability, supply chain optimization, product development and innovation. Unlike Drylock, First Quality has been more conservative with its investment approach and has not publicly announced a diaper-related investment since 2010 when it upgraded its plant in Macon, GA.
So what will the new capacity mean for the North American baby diaper market?
Both companies primarily serve the private label market, which continues to be pressured by multi-national brands. Store brands have countered this pressure with high quality, advanced features and strong marketing messages. These efforts helped boost sales of private label diapers an impressive 11% last year, according to data furnished by the Private Label Manufacturers Association. However, historically, it has been a challenge for these brands to hold onto marketshare gains taken from the major brands.
Of course, there is always the matter of the independent baby diaper market, which thanks to the success of brands like Honest, Kudos and HealthyBaby, has created new opportunities for diaper companies to expand their contract manufacturing efforts. Could some of this new capacity be targeting this segment of the market?
Either way, it is good news for the North American market that not one but two major companies are in investment mode.
As always, we appreciate your comments.
Karen McIntyre
Editor
kmcintyre@rodmanmedia.com
Even though the companies have different approaches to their businesses, both cited similar reasons for their investments—creating a more sustainable product, focusing on innovation and being closer to their customers.
Drylock Technologies, who will manufacture baby diapers in the U.S. for the first time at its new site in North Carolina, says the move will meet increasing demand for baby care products in North America where it has already been making adult diapers since 2018. Globally, the European company has been on an impressive growth and investment streak, catapulting its sales to surpass $1.2 billion in just a decade. We hope this winning streak will be extended with Drylock’s new U.S. investment.
First Quality, a long-time leader in the North American private label baby diaper category, has not yet announced the location of its investment, saying only that it will add 50% to its capacity and reaffirms the company’s ongoing commitment to the absorbent hygiene market as well as to sustainability, supply chain optimization, product development and innovation. Unlike Drylock, First Quality has been more conservative with its investment approach and has not publicly announced a diaper-related investment since 2010 when it upgraded its plant in Macon, GA.
So what will the new capacity mean for the North American baby diaper market?
Both companies primarily serve the private label market, which continues to be pressured by multi-national brands. Store brands have countered this pressure with high quality, advanced features and strong marketing messages. These efforts helped boost sales of private label diapers an impressive 11% last year, according to data furnished by the Private Label Manufacturers Association. However, historically, it has been a challenge for these brands to hold onto marketshare gains taken from the major brands.
Of course, there is always the matter of the independent baby diaper market, which thanks to the success of brands like Honest, Kudos and HealthyBaby, has created new opportunities for diaper companies to expand their contract manufacturing efforts. Could some of this new capacity be targeting this segment of the market?
Either way, it is good news for the North American market that not one but two major companies are in investment mode.
As always, we appreciate your comments.
Karen McIntyre
Editor
kmcintyre@rodmanmedia.com
