Consumables

Consumables are goods used by individuals and businesses that must be replaced regularly because they wear out or are used up. They can also be defined as the components of an end product that is used up or permanently altered in the process of manufacturing such as semiconductor wafers and basic chemicals.

Stocks of companies that make consumables are considered safe harbors for equity investors when the economy shows signs of weakness. The reasoning is simple; people always need to purchase groceries, clothes and gas no matter what the state of the broad economy. Many of the items measured in the basket of goods used to calculate the consumer price index (CPI) are consumables. Inflation in these items is closely watched because it can lower the discretionary income people have to spend on items such as cars, vacations and entertainment.

Large grocery retailers may lower prices on consumables as part of a long-term strategy to gain traffic and fend off competition. For example, in June 2016, Wal-Mart Stores Inc. announced it would roll back prices on consumables such as fresh produce, laundry detergent and over-the-counter drugs. The rollbacks are expected to reduce Wal-Mart's profit margins but also to draw traffic to Wal-Mart stores and boost the retailer's market share in the face of competition from other discount grocery stores.

Dental consumable products include dental crowns, implants and bridges as well as orthodontics wires and other biomaterials. The global market for dental consumables is projected to grow from $14.9 billion in 2011 to $23.8 billion in 2018. Factors contributing to the growth of this market include increasing awareness of dental health in emerging economies such as Hungary, Turkey and India. Dentsply International Inc. and Align Technology Inc. are leading suppliers in the dental consumables market.

Nanotechnology components are increasingly being incorporated into electronic products such as camera displays and battery systems. As a result, growth in the nanotechnology industry is driving the market for cleanroom consumables. Cleanrooms are a necessary part of the production and testing phases of these tiny products. Cleanroom consumables used in nanotechnology include disposable clothing, gloves and wipes to prevent contamination from dust and other unwanted elements. Leading producers in the cleanroom consumables department include Berkshire Corporation and E. I. du Pont de Nemours and Company, but smaller competitors are expected to compete for market share in regional markets.