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How Big is the U.S. Commercial Paper Towel Market?

Posted on 11/7/2012 in Hand Dryer Sustainability

The size and scope of the U.S. Commercial Paper Towel market has always been a source of interest for me.  When I first got involved with the hand dryer industry, it was one of the questions that was asked frequently.  Getting a straight answer was difficult, as the paper industry intentionally blends the figures with either the consumer part of the business or with tissue products as a whole.  However, I think I have triangulated the answer finally with quite a bit of authority.  And I will cite my sources.  We know it is a big number.  Someone once told me that in normal class A office space, paper towels typically generate 70-80% of the landfill waste as everything else is recycled in an organized fashion.

We know from Conservatree that Georgia-Pacific, Kimberly-Clark, and SCA are the largest paper towel companies in the U.S.  But they do not break out the sales for commercial paper towels or break out how much of the business is recycled content.

According to Tissue World magazine’s April/May 2012 edition, the US Tissue Market is a $16B market of which 37% is AFH (Away from Home, which is the industry’s term for commercial rather than consumer sales).   So this is a good start – that the U.S. AFH market size is around $5.92B.  But this includes napkins, toilet paper, and other tissue products.  So how much is paper towels?

RISI is a leading consulting company to the paper and tissue industry, and in 2008, they published a nice report about the industry.  From them we learn that, at least in weight, paper towels make up 42% of N. American AFH tissue consumption, which in total was 2.6M tonnes (a metric tonne is 1M grams, while a short ton (2,000 lbs.) is 907,185 grams).  So, the N. American AFH paper towel market is 1.092M tonnes.  Of course, that includes Mexico and Canada, so the U.S. market is less.  I would estimate that it must be around 60-70% of the N. American market, which would put it at around .65-.75M tonnes.

If we use the same 42% of tissue consumption as paper towels with the dollar market info above, we get a U.S. commercial paper towel market of around $2.486B.

So, do our weight and dollar numbers match?  This is pretty easy math.  A paper towel weighs around 2 grams.  Paper towels cost around a penny at retail, less than that at wholesale.  Let’s use 0.7 cents per towel.  If the dollar value is $2.486B, that is equal to a lot of paper towels – 355.14 trillion to be exact.  If each of those towels is 2 grams, we get 710.29 trillion grams.  Or .71M tonnes.  Right smack in the range we expected.

So, if our sources and math were correct, the U.S. AFH paper towel industry is a $2.486B market that creates .71M tonnes of landfill each year.  I don’t know how many vehicles it takes to deliver and dispose of them.  And I don’t know how many trees are felled to make them.  But it’s a whole lot of waste that could be mitigated by the strategic use of hand dryers!  In our next blog, we will look at the scientific evidence comparing paper with hand dryers from a carbon footprint equivalent through lifecycle analysis.



Tissue World April/May 2012

RISI Report 2008