By Craig Wagner
President of Global Glove
No longer are fierce competition and overseas outsourcers only the bane of the domestic manufacturer. Nor are integrated supply contracts and just-in-time inventory-delivery the sole headache for distributors. Inadequate and scattered education on proper glove application and chemical protection touches upon more than just the safety engineer and end user. Uneven and poorly enforced regulations not to mention an absence of uniform standards affects more than the governing bodies and trade associations working hard to affect and enforce both.
Our industry has seen record growth and improvements in nearly every aspect. But as we head into a new era, the lines once separating all industry players will continue to blur. And that interconnected quality will continue to play an important role in our collective future.
Where Have All the Pioneers Gone?
For today’s glove manufacturer and supplier, the competitive environment is dominated by one reality – intense competition from overseas, low-cost labor production. It’s a reality that spills from two dynamic pressures. The first is the internal drive all manufacturers in every industry and marketplace face to lower production costs and increase efficiency. That ever-present necessity has increasingly translated into more and more producers seeking lower-cost labor.
While much is written about the downside outsourcing or low-labor markets and its economic impact to local communities where plants once operated, there are competitive benefits. The upside includes the attrition of inefficient and unresponsive manufacturers, additional capacity and expanded options for distributors and end users. But the most important deliverable created by overseas outsourcing is lower priced gloves.
However, domestic production can and does thrive despite these pressures. Domestic manufacturers are typically more apt to manage quality through control of the production process. In addition, that control enables a producer to meet eleventh hour requests and specialized customer needs. In addition, heavy investment in automating the production line helps keep labor cost in check while allowing better management of capacity and inventory. Domestic plants provide a manufacturer distribution capabilities outsourcers can’t match.
The second reality shaping the domestic manufacturer’s world is the end users’ demand for better hand protection at lower prices. As industrial end users here and abroad face increasing pressure to reduce the overhead associated with making their finished goods, the race is on to eliminate cost and fat from every aspect of their operations. The safety engineer finds himself just as keenly focused on holding down costs as holding down accidents and workplace injuries. He needs the right glove at the right price.
An unhealthy byproduct is a hand protection industry without a focus on innovation and dwindling new product pipeline. New products are coming out and pioneering advances have broken through. But the incentive for some manufacturers and importers now lies in making or sourcing what already exists and doing so in a more cost-effective way. The overhead necessary for research and development, testing and analysis of new products and applications is becoming a drag on the manufacturer.
I’ve downplayed the damage consolidation does to the community where a glove plant once stood. That’s because I firmly believe in a free market economy. If an overseas supplier can deliver the same quality at a better price then that supplier should be able to compete here. But in cases such as China where glove makers are subsidized to keep workers employed, that creates more than an unfair advantage. That creates a market where domestic or other overseas manufacturers are working to match an unreal glove unit cost. That arbitrary price-point pressure also adds to the dwindling resources for innovation and eliminates some competitors unduly.
Cutting the Middleman
The same forces affecting the manufacturer and supplier are also impacting the distributor’s world. In addition to consolidation, leaner operations are stretching thinly-staffed distributor resources in a variety of ways. More and more the distributor/customer relationship resembles that of commodity broker and client as opposed to vendor and partner. In the past, a distributor could be found spending most of his time on the shop or plant floor.
Today, the distributor’s role in many cases is more of a de facto purchasing agent than a partner in safety. I will concede that price should always be a factor in selecting the right glove for the end user. Unfortunately, in many cases today it’s the primary one. In addition, distributors who once focused on the specific PPE needs of an end user now face elimination from integrated suppliers who provide clients everything from nuts and bolts to respirators and hand protection.
National and super-regional distributors threaten to replace more local and smaller shops. And like manufacturers, consolidation rids the market of inefficient distributorships. However, there will still be a place for the distributor who focuses on a niche piece of the MRO business. Small and efficient players who supply end-users with specific products will always have a future. Even for those larger and more efficient players left standing, mounting pressure to deliver more cost savings moves the distributor even further from a customer’s day-to-day operations.
The Mad Hatter
Today’s safety engineer wears a multitude of different hats and responsibilities to perform. From safety supervisor to supply manager, from shop foreman to acquisition influencer and specifier, the task of implementing and maintaining a safe workplace has expanded considerably.
Today, safety engineers must deliver on seemingly conflicting responsibilities – lowering acquisition costs while lowering worker injury and downtime incidence reports. Add to that the ongoing accreditation with affiliated safety and trade organizations, as well as keeping up with all applicable OSHA regulations, and a safety engineer’s work is never done.
As a result we’re seeing safety directors, safety engineers, purchasing agents, tool crib managers and anyone else charged with keeping up a safe workplace actively seeking additional arms, legs and technical resources from distributors and even suppliers. Where once calls from suppliers and manufacturers were avoided like the plague, thinly staffed safety departments are demanding more of an active role from their vendor-partners.
Arm and hand injuries are the second leading cause of accidents in the workplace behind eye injuries. What is truly regrettable is many of these accidents happen needlessly due to absence of or misapplication of proper hand protection. As more and more is demanded from fewer and fewer safety directors and engineers, the job of educating workers and end users belongs to us all.
Government agencies such as NIOSH and OSHA are not immune to the same pressures facing the businesses they study and regulate. Cuts in funding, greater emphasis on efficiency and delivering more value for taxpayer dollars is changing if not the agency’s regulatory role then most certainly it’s approach. In addition, it is increasingly clear that OSHA must seriously consider the CE Standards model already in place in the fledgling European Union. The European CE Standards apply for not only workplace regulations but PPE as well. While some minimum PPE standards do exist here, specifications really apply on an individual basis with each safety manager or director.
I believe in competitive strength, especially if a particular glove outclasses all others. But what the CE Standard enables the EU to do is standardize across the board for a certain PPE product or class. That means that even if an overseas, low-labor or homegrown product performs as well or better, if it doesn’t meet the CE Standard, it doesn’t gain entry. And while no country on earth has as vigilant an advocate for workplace safety than OSHA, most of the enforcement teeth in OSHA’s regulations concern environmental factors over product-specific safety mandates.
The CE Standards are by no means a magic bullet. And Europe has a lot of issues to tackle before it truly becomes the economic powerhouse it’s so often touted to be. But the blue print its laying out for getting there is one we can learn from.
Defining Our Collective Future
The state of the hand protection industry is strong. In some respects, it’s stronger than it has ever been with the initial promise of new technologies such as the Internet beginning to take hold. Yet the future will test us with challenges with which we have only recently started to wrestle with. Those challenges include the economic impact of a global economy and multi-national competitors and marketplaces. The future will also continue to test us with familiar demands such as greater efficiency, customer responsiveness and innovative solutions.
Innovation and new products are the lifeblood of any industry. That’s especially true with the hand protection. Stifling competition narrowly aimed at knocking off existing products as cheaply as possible will not create the kind of legacy our heritage as safety providers was built on.
There are no easy answers to these critical issues. The first step is making the commitment to truly understand the needs of our end-user customers. Only with this perspective will all participants in hand protection be able to transform our industry and shape our collective future.
Craig Wagner (email@example.com) is the President of a privately held glove maker, Global Glove of Ramsey, Minnesota. In addition to speaking and writing extensively about the hand protection market, Mr. Wagner is a frequent lecturer at on-site safety and quality assurance seminars for industrial workers across the country and around the world.
* Source: 1999 Bureau of Labor Statistics for Occupational and Workplace Injuries