Global Testing Laboratories Market to Reach $77 Billion by 2017
The global market for Testing Laboratories is forecast to reach $77 billion by 2017, according to “Testing Laboratories: A Global Strategic Business Report” from Global Industry Analysts Inc. Rising customer interest in the safety of food and other products, as well as the increasing number and stringency of regulations for assessing product safety, are some of the key factors driving growth in the testing laboratories market. Additional factors include globalization and the large diversity of products.
Both the number and size of testing laboratories worldwide, especially in developed markets such as the U.S., have been growing over the past several years. A major factor that led to this substantial growth is the increase in product testing numbers. Increasing consumer demand, globalization in sourcing and distribution, and the existence of significant diversity of products are providing substantial impetus to product testing and certification. Other factors contributing to growth include the rising cost of product liability insurance, a lack of comparable testing facilities within smaller facilities, and continued interest from large corporations to rely on independent testing facilities for securing independent results.
Growing concerns over safety of food and other products, and the subsequent implementation of regulations that necessitated testing of ingredients used in these products, led to the emergence of testing laboratories in the 20th century. During this time, several testing laboratories sprouted, especially in regions that had legislations that mandated specific safety standards. Historically, though, the testing laboratories industry witnessed gradual changes to include new types of laboratories that moved in tandem with evolving customer concerns. From food and radiation, the industry witnessed the development of laboratories for environment during the latter part of the century. This has not only resulted in the expansion of services at the existing laboratories for offering new services but also led to the establishment of new laboratories that specialized in a particular area. Today, various countries have myriad regulations for drugs, food, equipment, and other general products, and the emergence of laboratories that offer testing for various hazards and substances has propelled testing laboratories into an industry in its own right.
Europe leads the global testing laboratories market, according to the report; the U.S. follows in second place. Growth is expected to emanate from the Asia-Pacific region, which is forecasted to increase at a compounded annual growth of more than 9% during the analysis period.
Although demand for laboratory testing services largely relies on R&D spending from government and industry aimed at developing novel products and services, and in enhancing operational efficiencies, profitability in this labor-intensive industry depends largely on the technical expertise of independent companies. Large companies have an edge over smaller companies by providing a range of services from multiple sites, as well as from strategic alliances with major corporations. Meanwhile, the competitiveness of smaller laboratories lies in their focus on specific services.
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