Hundreds of billions of dollars in the blue ocean, low competition, high profit, high frequency repurchases!Amazon Business takes you to MRO!
In recent years, as industrial e-commerce has become popular with domestic capital, the term “MRO” has become popular in the investment and B2B fields. Similarly, the MRO (described in detail below) transition line has also become an irreversible trend in overseas markets. Take the US as an example. As a new force, Amazon has taken a very important position in this traditional field. Amazon Business has also quickly gained the trust of corporate buyers in various industries in the MRO field with its focus on long-tail purchases, convenient corporate buyer tools, and high-quality delivery times, and has become a “leading player” in the MRO field in the US.
Today, hundreds of thousands of buyers purchase the MRO category on Amazon every day. Stable demand and broad development space for third party sellers have made this category an unrelenting “gold” category, waiting to be developed and mined by Chinese sellers.
In this tweet, we'll show you in detail this mysterious and blue ocean category: MRO!Taking the US as an example, I will take you through the global MRO market situation, uncover the current recommended products on Amazon Business sites around the world, and also include product compliance considerations at the US, Europe, and Japan sites.
High energy warning: This post is full of useful information.
Be sure to stay focused and take good notes!
Understand basic MRO information in one minute
What is an MRO?
MRO is an abbreviation for maintenance, repair & operations in English, that is: maintenance maintenance, repair maintenance, operation operation (MRO). It usually refers to materials and services that do not directly form a product in the actual production process and are only used to maintain, repair, and operate equipment, that is, industrial goods that are not raw materials for production.
What are the main categories and products of MRO?
Maintenance maintenance
M (maintenance): spare parts required for regular maintenance of equipment or facilities, such as: instruments, fasteners, seals, adhesives, lubricants, electrical products, etc.;
Repair repair
R (maintenance): spare parts required for equipment or facility maintenance or emergency repair, such as: hand tools, electric tools, bearings, pneumohydraulic products, etc.;
Operation operation
O (operation): Other indirect materials required to maintain the operation of the equipment, such as cleaning, handling, storage, labor insurance, lighting products, etc.
MRO market data is here, Chinese sellers have unlimited potential
The US MRO market is huge, and Amazon is growing rapidly
According to a third-party data research agency (data source: D&B Industry Profile Industrial Supply), the US MRO market capacity alone reached 375 billion US dollars and maintained steady rapid growth. The rise of Amazon has also received great attention from leading companies and media related to this traditional field. In terms of numbers, Amazon's sales in the MRO category in the US far exceeded 10 billion US dollars in 2018, and maintained a compound annual growth rate of double digits for many years, quickly becoming one of the most important trading channels in the industry. At the same time, MRO is also one of the categories most popular among corporate buyers on Amazon's US site. More and more business buyers use Amazon to complete the procurement of spare parts needed for the company's daily operation and maintenance.
Third-party sellers are selling well, and there are many opportunities for Chinese companies
Take the US as an example. Third-party sellers account for more than half of all MRO sales on Amazon's US site. Overall, the MRO category is currently less competitive on Amazon, and is a typical growing category. Although currently mainly local distributors in the US, Chinese sellers have broad supply prospects:
• Through decades of experience in manufacturing, China has formed a high-quality industrial foundation and has strong product research and development capabilities;
• Through regular work for developed countries and regions such as Europe and America, Chinese companies have a deep understanding of the product needs of overseas customers, and Chinese products have been recognized by many international buyers;
• Cross-border e-commerce effectively develops the supply chain of industrial products in China. Chinese sellers are the seller group closest to the supply chain and have unique comparative advantages.
In recent years, Amazon Business has seen many high-quality Chinese companies stand out in the field of cross-border industrial products. The transaction volume has exceeded 10 million US dollars, and maintained rapid growth and high profits for many years.
Amazon Business
Drivers for the rise of the MRO category
In Amazon Business, what industry do the main buyers in the MRO category come from?
Almost all industries require MRO procurement, and some will even cover a large number of product categories.
Take the energy industry as an example: enterprises need to test measuring instruments, tools, etc. in the production process, and labor protection products are also essential due to the special nature of the working environment;
Also, in the case of the retail industry, which is relatively easy for most people to access, daily warehousing and transportation are inseparable from material handling products, and it is also necessary to purchase tools, cleaning supplies, etc. during store modifications and daily operations.
The three major pain points of traditional MRO procurement for corporate buyers:
1. It is necessary to manage a large number of suppliers: the individual products involved in MRO procurement are not large-scale but the variety is very diverse, and enterprises need large costs to manage and integrate the corresponding suppliers;
2. Limited procurement data transparency: In MRO procurement, the purchase volume of a single product is usually not large-scale and abrupt, so it is difficult for enterprise buyers to conduct comparative analysis and record research of large amounts of data during a single purchase, and they do not invest money to maintain detailed data;
3. Reliance on inquiries from integrated traders causes high costs: Since corporate MRO requirements are complex and detailed, and have the characteristics of high delivery time requirements for unplanned purchases, corporate buyers tend to complete package purchases through a one-time inquiry with integrated traders, so they are less sensitive to prices, which may cause high procurement costs.
Amazon Business effectively addresses MRO procurement pain points for corporate and institutional buyers:
Significant buyer pain points have prompted corporate buyers in these industries to gradually switch industrial product procurement to Amazon Business. Through the comparison of massive high-quality products, the use of powerful data analysis functions, and the application of management tools such as mother and child accounts, approval flows, etc., they can obtain higher procurement management efficiency, more transparent data, better delivery experience, and more favorable purchase prices.
Typical case
After landing on Amazon Business and becoming a corporate buyer, a well-known US Fortune 500 industrial manufacturer solved various problems encountered in the traditional MRO procurement process: supplier integration, information retrieval, logistics, freight costs, and prices, which in total can save more than hundreds of thousands of dollars in costs each year.
Amazon Business MRO independent web page, convenient for hundreds of thousands of business buyers to purchase
Today, hundreds of thousands of buyers purchase MRO categories every day on Amazon US. In order to facilitate purchases by corporate and institutional buyers, Amazon Business has developed an independent website for MRO buyers (https://www.amazon.com/MRO). As a seller, you can also view popular MRO categories purchased by corporate buyers on this page: including industrial electricity, labor protection, tools, test and measuring instruments, material handling, fasteners, etc. It can be used as a reference for subsequent related selections.
Category analysis: These high-potential MRO consumables,
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At this stage, which MRO segments are more suitable for Chinese sellers to mine money?At Amazon Business, we have formulated a “precise classification” from low to high according to the needs of corporate buyers and product technical support requirements, and defined the different categories included in MRO into 4 types, in order: industrial consumables MRO (consumable MRO), low tech MRO (low tech MRO), specific/non-standard parts MRO (Spec-based), and service-based MRO (Service Based MRO).
• Consumable MRO for industrial consumables: It is usually a fast turnaround and common daily use product, such as labor gloves, hand tools, tape, etc., and does not require technical support. At the same time, the brand loyalty of such products is low, making them most suitable for Chinese sellers to participate;
• Low tech MRO: usually accessory products, such as wires and cables, packaging items and other industrial accessories, require some technical support, but the technical content is not high, so it is more suitable for Chinese sellers to participate;
• Spec-based MRO for specifications/non-standard parts: It is necessary to communicate with the customer to understand the specific product specifications required to provide the customer with a better experience, such as the nut size, valve size, etc. that the screw needs to be equipped with;
• Service-oriented MRO: There are many related services required in this field, such as on-site retail machines capable of MRO inventory management, MRO maintenance services, etc.
Currently, Amazon Business provides a rich selection of high-quality products in MRO consumables and low-tech MRO products, and has gained the deep trust of enterprise buyers in these two segments.
Next, we'll focus on the most popular “Industrial Consumables MRO (Consumable MRO).”
What are the main product categories of industrial consumables?
In this issue of the category accelerator, we will focus on analyzing the three sub-categories of industrial consumables: labor protection, cleaning products, testing and measurement. The introduction includes: category definitions, market overview, and practical products recommended by Chinese sellers. See below for details.
Labor protection
1. Category introduction:
Labor protection equipment is a product or equipment equipped to ensure safe production and protect workers from work injuries or illnesses that may occur in different working environments or when carrying out dangerous operations.
2. Market Overview:
In 2018, the global labor protection products market reached 46 billion US dollars, and will maintain a steady growth rate of about 7% and reach a market size of 65 billion US dollars in 2023 (data source: BEROE).
Labor protection products are a relatively mature industrial category on Amazon. It is also because the performance parameters, materials, and processes of such products are highly standardized, and corporate buyers in various industries, especially schools, manufacturing, construction, and government agencies frequently purchase labor protection products. On the other hand, the chances of success for Chinese sellers have been verified by high-quality sellers recruited by Amazon Business, and excellent online growth indicates that more sellers will stand out.
3. Some product recommendations for Chinese sellers:
Cleaning products
1. Category introduction:
Cleaning products are one of the most widely used categories. Whether they are corporate buyers such as the government, medical institutions, schools, manufacturing industries, etc., or households and individuals, they are all users of this category. They are the categories they absolutely need. They mainly include cleaning tools, cleaning equipment, industrial wipes, garbage disposal, cleaning and maintenance products, etc.
2. Market Overview:
With the gradual improvement of health and cleaning laws and regulations in the medical, catering, and education industries. Taking the US market as an example, the scale of cleaning products is expected to reach its peak in nearly 10 years in 2019, surpassing 29 billion US dollars. (Data source: IBISWorld) On the Amazon US site, this second-level subcategory is the largest subcategory in the entire industrial, commercial, and scientific research category. Almost all institutional customers of Amazon Business have procurement needs, and Chinese sellers have a large number of sales opportunities.
Test and measurement
1. Category introduction:
Testing and measurement is also one of the most widely used categories, mainly including measuring tools, engineering surveying, physical testing, thermal instruments, environmental water quality, electronic and electrical engineering, and weighing.
2. Market Overview:
The global measuring instruments market is huge. According to the forecasts of Markets and Markets, in 2017-2023, the global measurement and testing instrument market will maintain a compound growth rate of 3.55% and reach US$32.3 billion by 2024, with huge market potential. (Data source: Markets and Markets) Highly compatible with the recovery and growth of the entire industry. The test and measurement instrument category on Amazon has entered a period of rapid growth and there are many opportunities for third-party sellers. Major corporate buyers come from the automotive, higher education, and manufacturing industries.
3. Some product recommendations for Chinese sellers:
Farewell tips:
The three types of MRO products, cleaning products, test and measurement, and labor protection, are typical corporate products. Developed countries with relatively sound legal systems and trade union systems will pay great attention to whether the products meet local standards and plans when purchasing such products. We have also made some brief summaries here so that all sellers who want to expand overseas markets can refer to:
Countless MRO buyers around the world have chosen Amazon Business as an important purchasing site. For all Chinese sellers, business opportunities are already in front of you. Whether you can seize and sell big globally depends on whether you take the initiative!
Now let's take a look at the Industrial Consumables (Consumable MRO) selection guide for you in detail. If you want to expand the industrial consumables market at Amazon Business's major sites around the world, how to select products is critical!In addition to this, we will also provide you with a profit analysis of recommended products and product compliance considerations for different regions. Without further ado, we immediately delivered a full range of dry goods.
The industrial consumables category includes labor protection, cleaning supplies, test and measurement, adhesives, manual & power tools, and commercial lighting. In this article, we'll focus on labor protection, cleaning supplies, and test measurements.
Labor protection
Labor protection equipment is a product or equipment equipped to ensure production safety and protect workers from work injuries or illnesses that may occur in different working environments or when carrying out dangerous operations. Therefore, it is mainly divided into two categories: personal protection and workplace safety protection.
Among them, personal protection can also be classified according to the object of protection, that is, different parts of the human body, including: facial protection, eye protection, head protection, full body protection, foot protection, hand protection, hearing protection, respiratory protection, etc.;
Workplace safety protection, on the other hand, includes environmental monitoring, safety alerts, workplace protection, emergency escape, and equipment protection.
Market analysis
In 2018, the global labor protection market was worth US$46 billion; it is estimated that the global personal protective equipment market will grow at a rate of 7% and reach US$65 billion by 2023. (Data source: BEROE) Factors such as industrial development, improved government regulations, and increased workers' health and legal awareness will all drive the increase in demand for personal protective equipment. In the US, for example, OSHA (US Occupational Safety and Health Administration) issues common sense standard requirements to prevent employers from putting workers in risky environments. Therefore, employers must purchase safety protective equipment in accordance with laws and regulations to protect the safety of employees, which also makes the sales growth rate in this category very impressive.
The industrial scale of labor protection products in China is huge, and a series of industrial agglomeration areas have been formed. Beijing has a large number of safety hat manufacturers, while Shanghai and Zhejiang have brought together a large number of manufacturers of safety shoes, protective gloves, hard hats, and masks. Guangdong Province has a strong foundation in the protective gloves, safety helmet, and mask industry. The quality of China's labor protection products has been recognized by the international market, and the output and export volume of some products rank among the highest in the world.
Amazon's best-selling products
Due to the high degree of standardization of performance parameters, materials, and processes of labor protection products, such products are one of the most mature industrial categories on Amazon. On the other hand, the possibility of Chinese sellers succeeding in leading products has been verified by high-quality sellers recruited by Amazon Business, and excellent online growth indicates that more sellers will stand out.
Take Amazon's US site as an example. Safety earmuffs, flashlights, protective glasses, and nitrile gloves are all typical popular products. Business buyers in various industries, especially schools, manufacturing, construction, and government agencies frequently purchase labor protection products.
Product recommendations for Chinese sellers
Compared with traditional offline channels, sales of labor protection products on Amazon have maintained a compound annual growth rate of several times. At the same time, stable demand also ensures that it is a category worthy of in-depth exploration and continuous investment by Chinese sellers. Combining current size, growth trends, and fierce competition, we have focused on the following products: welder masks, safety warning road cones, protective shoe covers, safety reflectors, protective reflective jackets, and safety knee pads.
In addition to volume, trends, and competition, reference profit margins are also aspects that Chinese sellers are concerned about. Take safety warning road cones as an example. Under the premise of the same material and specifications, the reference purchase price for Chinese sellers is only 2-3 US dollars/piece; on the other hand, the reference terminal sales price for a traditional retailer in the US is 40-50 US dollars/piece. This is an important reason why these products are highly favored by business buyers on Amazon.
Since most labor protection products are “consumables” and have a short service life cycle, it is recommended that sellers sell in multi-piece sets at the time of sale, which can also reduce the proportion of the cost of FBA delivery fees accordingly.
Product certifications and industry standards
In order to ensure the quality and safety of labor protection products sold, governments and regulators around the world have introduced numerous certification standards and entry systems. Compliance certification has become a general trend in the upgrading of the labor protection products industry, and it is also the foundation for brand building.
Labor protection
US
1. Prop CA 65 California Proposition 65, Drinking Water Safety and Toxic Substances Enforcement Act
2. ASTM Z87.1 (American standard for safety glasses, welding helmets, applicable in product design and testing; products that meet the requirements can be marked with the ANSI Z87.1 Mark on the product)
Europe
PPE (Personal Protective Equipment) Directive Regulation (EU) 2016/425 Sellers need to know what category their products fall into and which EN standards under the PPE Directive need to meet
cleaning products
Cleaning products are one of the most widely used categories. Whether they are corporate buyers such as the government, medical institutions, schools, manufacturing industries, etc., or households and individuals, they are users of this category. The sub-categories of cleaning products include: cleaning tools, cleaning equipment, industrial wipes, garbage disposal and cleaning products. Carpet cleaners, mops, dryers, trash cans, hand sanitizers, etc. are typical products for cleaning products.
Market analysis
For European and American countries where health awareness is popular, whether in public places or office areas, they will maintain high standards of environmental cleaning and disinfection. In the past five years, in the US, for example, the wholesale supply and wholesale industry of industrial cleaning equipment grew by 3.6%, reaching $29 billion in revenue in 2019 (data source: IBISWorld). Cleaning products are a category closely related to the prosperity of the commercial economy, so the US market also continued to grow after falling in 2008, and is expected to reach the highest sales peak in the cleaning products industry in 2019.
China's cleaning products industry is huge. Compared with labor protection products, the distribution of industrial belts is scattered. Zhejiang Jinhua (Yongkang) and Hebei Bazhou both have cleaning tools and cleaning equipment industry belts based on plastic products. In addition, small household cleaning appliances also have corresponding industrial belts in Cixi, Ningbo.
Amazon's best-selling products
Take Amazon's US site as an example. The cleaning products category is the largest subcategory under the industrial, commercial, and scientific research categories. Almost all institutional customers of Amazon Business, whether they are the government, hospitals, schools, or enterprises and factories, have procurement needs for cleaning products. However, the demand for cleaning products varies from industry to industry. For example, construction contractors mainly need cleaners for floors, carpets, toilets, window panes, and furniture. Overall, tissues, hand sanitizer, trash cans, and stand-up vacuum cleaners are typical hot sellers on Amazon. Products that are purchased more by corporate buyers at one time also include garbage bags, special laboratory cleaning supplies, and commercial toilet infant changing tables. As a category that is absolutely in demand, cleaning products companies will usher in better development prospects if they have the ability to independently design and develop.
Product recommendations for Chinese sellers
Judging from product compliance, there are no mandatory requirements or design standards for cleaning products, but such products have a large number of patent restrictions in the US (for example: Rubbermaid has hundreds of patents in the US cleaning products market), so sellers are advised to do a patent investigation before going online. On Amazon, sales of such products are currently dominated by well-known self-operated brands, but there is no shortage of products suitable for Chinese sellers to participate, such as commercial non-slip rubber mats, disposable sticky foot pads, toilet paper holders, rubber cleaning brushes, trash clips, and liquid soap dispensers.
The sales profits of the above six products are also quite impressive. Among them, take disposable sticky foot pads as an example. Under the premise of the same materials and specifications, the reference purchase price for a single sticky foot pad by Chinese sellers is 1.5-2 US dollars; on the other hand, if a corporate buyer purchases this product through traditional offline channels and trading methods, it is basically 40-50 US dollars when referring to the price of a traditional retailer in the US. This type of product also has no obvious brand loyalty due to this price factor, so it is suitable for transformation to online sales.
In addition, cleaning products are also typical consumables, so after joining Amazon Business, you can try participating in wholesale stores and sell them in multi-piece sets, which is also a typical procurement method for corporate buyers.
Product certifications and industry standards
As environmental awareness has increased, whether the product is environmentally friendly has also begun to influence the purchasing decisions of many corporate buyers, so sellers are advised to understand environmental protection laws in different regions when selling. For example, in the US market, it is necessary to know in advance whether the relevant products are subject to the US Environmental Protection Agency (EPA) or other environmental related certifications.
Cleaning products
US
1. Prop CA 65 California Proposition 65, Drinking Water Safety and Toxic Substances Enforcement Act
2. NSF Certification (kitchen and bathroom appliances require this certification, which is mainly tested for heavy metal content in products)
Test and measurement
Test and measuring instruments are instruments or equipment used to detect, measure, observe, and calculate various physical quantities, material components, physical properties, etc. It is mainly divided into measuring tools, engineering surveying and mapping, physical testing, thermal instruments, environmental water quality, electronic and electrical engineering, and weighing. Among these, horizontal scales, push-pull force meters, pressure gauges, electronic bench scales, etc. are typical products for measuring and testing supplies.
Market analysis
The global market for test and measurement equipment is huge. Applications include automotive, aerospace and defense, electronics and semiconductors, industry, education, information technology and telecommunications, and healthcare. According to forecasts by Markets and Markets, the global measurement and testing instruments market will maintain a compound growth rate of 3.55% from 2017 to 2023, reaching US$32.3 billion by 2024. (Data source: International market research agency Markets and Markets)
Looking at the development of the global instrumentation industry by region:
United States
With a well-developed information industry, a high level of industrial technology and a large population, it is the most important market for measurement and testing instruments. In 2016, it occupied 47% of the global market share.
Europe
It has a rich industrial heritage and focuses on environmental protection and quality monitoring. It is the second largest market for measurement and testing instruments, accounting for 28% of the global market share in 2016.
Asia Pacific
The population is large, the manufacturing industry is developing rapidly, and the demand for infrastructure construction is strong. In 2016, it occupied 19% of the global market share.
(Data source: Ministry of Industry and Information Technology)
From the supply side, China has become the second largest instrument manufacturer in the world. From January to December 2017, China's instrumentation industry completed a total export delivery value of 134.774 billion yuan, and instrumentation products were exported to many countries such as Europe and the United States. Moreover, instrument companies have also continued to grow, “going overseas” to acquire foreign instrument companies one after another. (Data source: China Instrument Network)
The industrial belt of test and measuring instruments, especially charged test instruments, is mainly concentrated in Guangdong and Zhejiang. Representative products such as oscilloscopes, multimeters, clamp meters, etc.; the industrial belt of measuring tools and engineering surveying and mapping instruments is mainly concentrated in Zhejiang Jinhua (Yongkang) and Jiangsu regions, representing products such as calipers, gauges, micrometers, etc.
Amazon's best-selling products
The test and measurement categories on Amazon are highly compatible with the recovery and growth of the entire major industry. It has entered a period of rapid growth, and third-party sellers account for more than half. The main corporate buyers come from the automobile, construction industry, medical research institutions, and manufacturing. More and more Chinese measuring instrument companies are gaining access to overseas markets at a faster rate through Amazon Business, thereby obtaining capital to continue improving their products, continuously improving their brand strength, and winning more purchase orders.
Test and measurement devices are used at different stages of the product development lifecycle and are therefore increasingly used in the industrial manufacturing industry. In addition, engineering surveying and mapping in the construction industry is also a typical application scenario for this category. Many aspects of the construction process at construction sites require testing instruments such as laser levels, level scales, and thickness gauges for calibration and measurement. Looking at it now, take Amazon's US site as an example. The customer unit price for popular tests and measurements is relatively low, and professional attributes for industrial applications are not obvious; they also include digital multimeters, tape measures, etc.
Product recommendations for Chinese sellers
Testing and measuring instruments have outstanding growth potential on Amazon, and the continuous enrichment of product selections has encouraged more buyers to complete online purchases on Amazon. In recent years, we have also seen the rapid rise of some Chinese brands in this category. They are closer to consumers through cross-border e-commerce to quickly obtain product feedback, continuously optimize products, and gradually be recognized by overseas buyers, so the test and measurement category is very worthy of the attention of Chinese sellers. In addition to the top products listed above, we have also selected products such as digital industrial borescopes, digital outer diameter micrometers, wire finders, adjustable DC power supplies, multi-function wall detectors, infrared thermal imagers, and electromagnetic field meters for your reference.
Compared with other MRO consumables products, test and measurement products have a certain technical threshold, and market competition has not reached a very intense level, so sales profits are also more attractive than other products.
Take the wire finder shown in the picture as an example. The reference purchase price for a Chinese seller is 6-8 US dollars; on the other hand, a traditional retailer in the US has a reference sales price of 50-60 US dollars for this wire finder terminal. If a Chinese seller sells this type of product as a close source of supply, I believe it will be favored by corporate buyers and obtain good profit margins.
Product certifications and industry standards
Test and measurement products need to obtain relevant certification in many regions, so sellers need to understand what certification requirements are required in their market before launching test and measurement products.
Labor protection
US
1. Prop CA 65 California Proposition 65, Drinking Water Safety and Toxic Substances Enforcement Act
2. Safety certification UL/CSA/ETL (Equipment with DC or AC power supply requires relevant certification to be sold in the US market; low-voltage power supply products do not require this. )
Europe
1. REACH Chemical Substances Control (EC) No 1907/2006 (Regulation (EC) No 1907/2006) mainly targets the registration and control of chemical substances released in the European Union (in releases/components) or more than 1 ton/year.
2. Measuring instruments within the scope of the MID Directive 2014/32/EU on Measuring Instruments must pass the corresponding conformity assessment procedure before leaving the factory.
Japan
1. PSE Mark The electrical equipment specified in the Electrical Equipment and Material Safety Act requires the acquisition of
2. Giteki Mark, required to obtain designated radio equipment as stipulated in Japan's Radio Law
The above is an overview of the three major categories of industrial consumables: labor protection, cleaning products, and testing and measurement. I hope it can help more relevant Chinese sellers explore this blue ocean and seize more business opportunities.