|Status : Published||Published On : Sep, 2021||Report Code : VRSME9065||Industry : Semiconductor & Electronics||Available Format :||Page : 300|
The testing, inspection, and certification market in consumer goods & retail industry was USD 30 billion in 2020, registering a CAGR of 4.5% during the forecast period 2021-2027. Testing in TIC means an industrial activity that assures manufactured products, individual components, and multi-component systems are suitable for the predetermined purpose.
Inspection and testing are the operating parts of quality control which supports cost, productivity, on-time delivery, and market share, thus the critical factor for the survival of any manufacturing company. The testing, inspection, and certification market report is composed of conformity assessment agencies, which provide services from audit and inspection to testing, verification, quality assurance, and certification.
Globalization has led to product standardization norms and has penetrated developed technologies across various industries such as retail industry, food and beverage, electronics and automotive industries, etc., resulting in the growth of the TIC market during the forecast period 2021-2027. Moreover, the growing middle-class population, rapid urbanization, mandatory safety regulations, upsurge in the illicit trade of counterfeit and pirated products, advancement in networking and communication technology, the inclination of outsourcing testing, inspection, and certification services has propelled the growth of the TIC market in the consumer goods & retail industry. Furthermore, there is a growth in the TIC Industry owing to mandatory government regulations on consumer product testing requiring inspection rules and the increase in trade of consumer products, resulting in the growing demand of TIC in the consumer goods & retail industry. Nevertheless, TIC provides various advantages related to its credibility and image, compliance with legal and regulatory requirements, less turnover of employees, high level of cost control improvement, and fast improvement of different processes.
The COVID-19 pandemic resulted in a short-term decline in demand and revenue in the first quarter of 2020. Moreover, TIC is playing a crucial role by offering assurance that the products and services offered to the customers will provide safety and health standards.
Business organizations in the TIC market for consumer goods and retail sector are intensifying IT infrastructures, developing technologies to sustain business continuity plans, conduct audits, damage assessments, and certification procedures, implying that the testing, inspection, and certification market are holding the substantial potential to bounce back from the COVID-19 outbreak. This is due to the fact that TIC services will enhance and protect brand reputation, verify products’ safety, and enables trade.
Insight by Sourcing Type
Based on sourcing type, the TIC market for consumer goods & retail industry is bifurcated into in-house and outsourced. Among the two segments, the in-house segment dominates the market and is anticipated to hold the largest share during the forecast period 2021-2027. Deploying in-house testing and inspection will offer companies to have complete control over the entire process in terms of technology, skilled personnel, and testing and measurement equipment. Thus, enabling organizations to handle TIC activities like on-site availability, ability to employ talent, and establish custom practices as per the needs and desires of the organizations.
Insight by Service Type
Based on service type, the TIC market for consumer goods & retail industry is segmented into testing, inspection, and certification. Among these segments, the testing segment holds the largest share in the testing, inspection, and certification market in 2020 owing to the diverse product standards, stringent regulations by European Standards and Directives, AATCC, ASTM, The US Consumer Product Safety Commission, etc., providing Total Quality Assurance to clients, ensuring the overall safety to end consumers, growing industrialization, and a need to protect the brand. Product Testing can be performed on a wide variety of materials, product lines, services and prototype creations. Moreover, the certification market is anticipated to have a high CAGR during the forecast period owing to the consumer awareness about the certified products, companies growing need to improve the product value, the surge in demand for quality and safe products, and mandatory regulatory requirements.
Insight by Industry Vertical
Based on industry vertical, the TIC market for consumer goods and retail industry is divided into apparel and textiles, electrical & electronic goods, personal care and cosmetics, home and garden, toys and children’s products, footwear and leather, bags and accessories, fashion accessories, smart and wireless devices, and others. The digital transformation has led to the reshaping of the TIC market. The electronics industry is witnessing fierce competition on account of fast production lines driven by automation, as a result, the products need to be safe and are according to specifications, resulting in the growth of the TIC market. Furthermore, smart and wireless device companies need to produce goods by addressing the risks such as cybersecurity, interoperability, interference, reliability, health and safety, and environmental performance, resulting in the growth of the TIC market. Thus, the companies in the consumer goods and retail sector have to comply with quality regulations and standards to provide quality products to consumers. For instance, Bureau Veritas has introduced platforms such as QuikTrak which is the largest qualified inspector marketplace, and LEAD which offers digital sales, delivery of certification audits and tools, and provide training programs.
The TIC market for consumer goods & retail industry is characterized by various industry trends such as growing investment in AR and VR, mounting adoption of connected devices and cloud-based technology, increasing mergers and acquisitions by the industry players, and sustained consolidation of suppliers leading to globalization.
The growing government-enforced regulations, considerable industry standards, certification requirements, and huge penalties against non-compliance parties are projected to drive the demand for TIC in the consumer goods & retail industry. There is a need to provide comprehensive quality, safety services, build, maintain & protect brand reputation along with product performance, and environmental protection will result in the growth of the TIC market for consumer goods and retail industry. Thus, the increase in attention of manufacturing companies to offer quality products will enhance customer retention, mounting demand for interoperability testing for connected devices and IoT, globalization, and rise of global trade, and emerging digital technologies will boost the growth of the TIC market in consumer goods & retail industry.
The testing, inspection, and certification market may face certain challenges like trade wars and growth fluctuations, huge investment for automation and installation of industrial safety systems, high cost of TIC owing to diverse standards and regulations globally. Moreover, a lack of testing facilities and skilled personnel may hamper the growth of the TIC market.
Testing, inspection, and certification is a massive market that provides lucrative opportunities in technologies such as AI, robotics, drones, big data analytics, next-generation automation, and cloud and cybersecurity. Moreover, there is a need to deploy an effective and extensive inspection system that provides promising opportunities for the growth of the TIC market in the consumer goods and retail industry.
Geographically, APAC is anticipated to have a high CAGR during the forecast period owing to the rising investment in R&D, rapid urbanization & industrialization, huge manufacturing capabilities and exports, rising per capita income among the middle-class population, improved lifestyles, and increasing consumer awareness about the importance of quality certification, testing, and inspection. Moreover, the developed countries have their manufacturing units and testing labs in the region, especially in China and India. These manufacturing units manufacture products according to internationally accepted standards. Nevertheless, the growing middle-class population has led to the growth in private consumption and mounting demand for safety and product quality, resulting in providing opportunities in the consumer goods and retail industry.
Key players are adopting technological changes to improve their product portfolio and generate new revenues, optimize the operational cost, and enhance service efficiencies via process upgrades. The industry players are taking the COVID-19 crisis as an opportunity to restructure and revisit their existing strategies, focus on new services and delivery models to access the demand for rising automation, remotely-performed services, and enhanced digitization. Moreover, the industry players in the TIC market have started building strategies like mergers and acquisitions, product innovation, and geographical expansion to hold a major share in the TIC market for consumer goods and retail industry.
SGS acquired Thomas J. Stephens & Associates Inc. (Stephens), a US-based clinical research organization that serves the cosmetic and personal care industry. The latter is recognized as one of the leading providers of safety and efficacy testing and contract research services. With this acquisition, SGS expanded its Consumer and Retail service portfolio in the clinical testing sector for cosmetic and personal care products.
Some of the key players operating in the TIC market in consumer goods and retail industry: Intertek Group plc, Bureau Veritas, UL LLC, SGS SA, Eurofins USA, TUV Rheinland, DEKRA SE, ALS Limited, Applus+, and DNV GL.
Source: VynZ Research