---
title: "Have Masks Successfully Joined the Ranks of FMCG? Stop Entering the Market—Get Out Now!"
description: "Masks have become a 'fast-moving consumer good'? Is it still too late to enter the market? Don't think about it—get out of the pit. What defines FMCG? Generally, we consider FMCG as an abbreviation for fast-moving consumer goods, called 'fast' because they are daily necessities that rely on high-frequency and repeated use and consumption, generating profit and value through large market volumes. During the pandemic, masks, in terms of usage frequency, consumption speed, and global demand scale, have indeed successfully entered the FMCG category. However, the explosive growth of masks triggered by the pandemic has led to extreme chaos behind short-term profits."
author: "陈峰"
publisher: "New Distribution"
email: "zhaobo258@gmail.com"
telephone: "+8615854817671"
published: "2020-05-31"
language: "en"
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# Have Masks Successfully Joined the Ranks of FMCG? Stop Entering the Market—Get Out Now!

> Masks have become a 'fast-moving consumer good'? Is it still too late to enter the market? Don't think about it—get out of the pit. What defines FMCG? Generally, we consider FMCG as an abbreviation for fast-moving consumer goods, called 'fast' because they are daily necessities that rely on high-frequency and repeated use and consumption, generating profit and value through large market volumes. During the pandemic, masks, in terms of usage frequency, consumption speed, and global demand scale, have indeed successfully entered the FMCG category. However, the explosive growth of masks triggered by the pandemic has led to extreme chaos behind short-term profits.

Have masks become a 'fast-moving consumer good'? Is it still too late to enter the market? Don't think about it—get out of the pit.
What defines FMCG? Generally, we consider FMCG as an abbreviation for fast-moving consumer goods, called 'fast' because they are first daily necessities that rely on high-frequency and repeated use and consumption, generating profit and value through large market volumes. **During the pandemic, masks, in terms of usage frequency, consumption speed, and global demand scale, have indeed successfully entered the FMCG category.**
However, the explosive growth of masks triggered by the pandemic has spawned a large number of enterprises, merchants, and individuals to engage in the production and sale of masks and related products. Myths of overnight wealth from masks, equipment, and raw materials have emerged one after another. **Behind this new 'FMCG' lies extreme chaos brought by short-term huge profits.** The problem now is not whether to enter the market, but how the 'small fry' already in the market without hard strength can jump out of this mask pit.
**-01-**
### **Supply-Demand Reversal, Price Plunge, Masks Sold Cheaply to Escape**
After the pandemic, do you still need masks? The answer is obvious. As the domestic epidemic situation has basically stabilized, masks have been pulled off the 'pedestal.'
**In the first half of the year, mask orders surged, prices kept rising, and N95 masks even sold for over a hundred yuan each, prompting many to invest in mask factories.** Tianyancha data shows that as of March 12, 2020, there were 38,151 mask and respiratory protection related enterprises in China, with 6,114 new additions since February 2020, a growth rate of 1,561% compared to the same period last year.
**For those who saw business opportunities, some early entrants did make a fortune, but latecomers who hesitated or were stuck on raw materials, equipment, production qualifications, etc., may suffer heavy losses.** In fact, there are already a large number of mask manufacturers dumping goods and equipment. Early profiteers are selling off goods or machines to new speculators, while many latecomers, realizing the mask business is a deep pit, are eager to exit and cut losses.
**The mask factory business is much deeper than you think.**
As early as February 29, domestic mask production capacity reached 110 million pieces, with daily output of 116 million pieces (excluding unlicensed mask merchants), quickly alleviating domestic mask demand. Capacity expansion drove raw material prices to skyrocket, with melt-blown fabric, usually selling at 20,000 yuan per ton, being speculated up to 800,000 yuan per ton—a 40-fold increase. Non-woven fabric, originally 10,000-20,000 yuan per ton, was sold at 130,000-140,000 yuan per ton.
**Mask production equipment also saw prices multiply**, but the difference is that the equipment market is even murkier. Since the threshold is not too high, besides original equipment manufacturers, many capable enterprises transformed to produce mask-making equipment during the pandemic, leading to various chaos.
**Many enterprises underestimated the technical content of mask production before switching. As the process progressed, many problems gradually emerged.** People then realized that a small mask involves many components, raw materials, production equipment, and qualification standards, and getting everything running is not easier than producing other products. At this point, suppliers capable of delivering complete machines could already be called 'conscientious enterprises.'
Some manufacturers deliver a pile of parts and ask customers to assemble them themselves; worse, some only download drawings online and claim they can make mask machines, starting to collect deposits. Besides hardware limitations, there is also a shortage of personnel for installation, debugging, and daily maintenance of mask machines. Incidents of purchased machines becoming scrap metal are frequent.
It seems like a golden opportunity for overnight wealth, but to truly run a mask factory well, you need early entry, good equipment, sufficient raw material supply, and unblocked qualifications, among other conditions.
And today, the public retail price of disposable medical masks has dropped to as low as 0.5 yuan per piece, from the earliest 7 yuan each (some resellers even raised prices to over ten yuan), experiencing a cliff-like plunge.
**This is a very important signal that mask prices are no longer firm, and a general price collapse is about to begin.** You might say 0.5 yuan is too extreme and only a small quantity at that price. True, but overall, mask prices have indeed plummeted.
Those speculators who once squeezed in are now trying to climb out of the quagmire.
**-02-**
### **Chaos Abounds; Hard Skills Win the Future**
**The mask chaos first manifests in prices. When the domestic epidemic broke out, mask production capacity lagged far behind, and with supply falling short of demand, masks were speculated to sky-high prices.** Although relevant authorities punished pharmacies and manufacturers that jacked up prices, the supply-demand relationship remained, and such regulation could not stop most mask prices from rising.
As a result, some pharmacies couldn't get masks and had to find other channels. A Beijing pharmacy manager said that during normal times, disposable medical masks cost 3-5 yuan per pack of ten. During the pandemic, due to road controls, the pharmacy's supply channels were blocked. 'On one hand, the purchase price of masks increased significantly; on the other hand, even if we ordered, it took a long time to receive them.' Considering that some pharmacies had been penalized for price gouging, the manager chose to stop selling masks.
In contrast, various 'small quantities in stock' high-priced masks were selling briskly on channels like WeChat Moments. Some enterprises, needing to resume work, also had to find various channels to secure masks for normal operations.
**Besides prices, the proliferation of substandard 'three-no' masks is even more concerning. Authorities have successively cracked down on many cases of producing and selling counterfeit and shoddy masks.** According to incomplete statistics, almost all transactions were conducted through informal channels like WeChat, and masks changed hands multiple times, making tracing difficult, so production qualifications and certificates could not be verified. Meanwhile, subsequent rights protection faced difficulties in evidence collection.
Image source: People's Daily
'The factory was a temporary iron-sheet shed with no disinfection measures, and the machines were stained with dirt.' This is what a police officer saw when raiding a counterfeit production site.
**When masks were in the shortest supply, even 'whiteboard masks' with extremely low melt-blown efficiency and only dust-proof function sold well.** After all, for consumers, having something is better than nothing. As the epidemic was controlled, market rectification and media exposure caused counterfeit and small mask factories to lose their offline market. So will the entire mask industry collapse? Not necessarily; we can still see a batch of mask brands with firm prices and considerable sales.
From online channels, big brands like BYD still have good sales and reputation, and they remain in short supply offline, not to mention overseas orders worth hundreds of millions or billions. Why is there such a serious polarization?
In short, it's a matter of hard strength. Speculation can only bring temporary huge profits; without hard strength, it will eventually collapse.
The demand-driven, frenzied, and distorted mask market, when supply fell short, saw suppliers frenzied and strong, giving birth to a group of 'scalpers' in the mask industry. However, in a manufacturing powerhouse like China, such situations quickly disappear. Once production capacity catches up and returns to original channels, and affordable genuine masks are easily available, will there be room for inferior and high-priced masks?
**Serious technology is the hard strength that wins the future. Those trying to fish in troubled waters will end up in a mess.**


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