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Emerging markets a sweet spot for commercial and reminder items suppliers

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Table of Contents

01Executive Summary

• Global Promotional Items—Industry Outlook

• Supply Market Outlook• BREXIT – Impact on Commercial and

Reminder Items Industry

02Market Analysis

• Global Promotional Items—Market Maturity

• Global Promotional Items—Industry Trends • Regional Market Outlook• Porter’s Five Forces Analysis

03Supply Analysis

• Supply Trends and Insights• Key Global and Regional Suppliers• Supplier Profiles• Strengths, Weaknesses, Opportunities and

Threats (SWOT) Analysis for Top Global Suppliers

04Procurement Best Practices

• Sourcing Models Adoption• Global Purchase Organization Engagement• Comparative Analysis• Pros and Cons• Key Performance Indicator (KPI) and

Service-Level Agreement (SLA) Components

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Preview

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Executive Summary (1/3)

Sources: Primary Expert 1, Primary Expert 2, Primary Expert 3, Primary Expert 4, PPAI publications, Beroe Analysis, ASI Central, Global Sources

TOP GLOBAL SERVICE PROVIDERSINTERNATIONAL PARTNERSHIP FOR PREMIUMS & GIFTS (IPPAG) | IGC GLOBAL PROMOTIONS | BRAND ADDITION | POLYCONCEPT |

INNERWORKINGS | HH GLOBAL

EMERGING ENGAGEMENT STRATEGIESCross-Category BundlingEnd-to-End Service Providers

CONTRACT PERIODMinimum 1 YearMaximum >3 YearsINDUSTRY PAYMENT PERIOD60–90 Days

MARKET OVERVIEWGlobal market size of $68 billion in 2015, with an annual growth rate of approximately 4 percent

KPIs IN PROMOTIONAL ITEMS SOURCING• Lead Time to Delivery• Invoice Accuracy• Average Resolution Time• Third-Party Factory Audits• Manufacturing Process Adherence

FBT

37 %

CPG

28 %

BFSI

12 %

Others

20 %

Pharma

3 %

PROJECTED DEMAND CONTRIBUTION BY INDUSTRY (2016)PRICING • Fixed Fee• Cost Plus• Sliding Scale• Blended/Hybrid

MAJOR COST Increasing raw material and labour costs have a major impact on the overall product price

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Executive Summary (2/3) Global Reminder Items Industry Outlook

• The global reminder items market was valued at $68 billion in 2015, and is growing at approximately 4 percent year-on-year. The total global spend for promotional items is forecasted to be $74–76 billion by 2018.

• The growth will be driven by the increasing focus of key end-user industries, like food, beverages and CPG, on the emerging markets.

• Most of the growth in demand will be from the emerging markets in Asia and Latin America (LATAM), in addition to the United States (US), Oceania and the Middle East.

• In 2015, the global pharma industry commercial items’ spend contributed to less than three percent of the overall commercial items market, which valued at $1.5–2 billion and is expected to fall less than $1.5 billion by 2020.

Market Maturity LowMediumHigh

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Sources: Primary Expert 1, Primary Expert 3, Beroe Analysis, Global Sources, PPAI Publications

01 North America

$20–22 billion

growing at 2–3 percent

02 LATAM

$11–13 billion

growing at 5–6 percent

03 Europe

$18–20 billion

growing at 1–2 percent

04 Asia Pacific (APAC)

$12–14 billion

growing at 6–7 percent

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High Maturity CountriesThe US, Canada, the United Kingdom (UK), Germany, France, Italy and parts of Western Europe

Executive Summary (3/3)Supply Market Outlook

Suppliers: The supplier market is mature, with the presence of large and well-established players. Being part of a competitive industry, suppliers are willing to invest in technological upgrades in order to become more attractive to buyers.

Low Maturity CountriesVietnam, Bangladesh, Venezuela, Peru, Colombia and other parts of LATAM

Suppliers: Service providers in these markets have a limited product portfolio or operate in a niche segment, making the global suppliers keen in either partnering with or acquiring them to increase their geographical reach. The remaining demand is from local buyers.

Medium Maturity CountriesChina, Japan, India, Indonesia, Korea, Denmark, Mexico, Brazil, Argentina, Australia and parts of Eastern Europe

Suppliers: Global service providers have an extensive presence in these markets. However, buyers tend to adopt a local sourcing strategy in order to benefit from cost savings. Few global buyers in these markets are beginning to consolidate regional demand with their global spend.

MediumHigh Low

Sources: Primary Expert 2, Primary Expert 3, Beroe Analysis, Global Sources, PPAI

Demand Trends

Value-Added Services

The increasing need for supply chain transparency constantly demands that suppliers modify the services that they offer to buyers. Service providers are also looking forward to transform themselves into end-to-end service providers, especially in key markets, in order to become more attractive to buyers.

Cross-Category Consolidation

Suppliers are equipping themselves to provide consolidation across the print and point of sale material (POSM) categories, along with promotional items. This would enable enhanced cost savings due to increasing volume.

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