This picture contrasts sharply with that of 2016, when the relaxation of the one-child policy, which would allow couples to have two children, was expected to drive up birth rates and grow the population. Last year, the government even opened the door for couples to have up to three children.
However, most Chinese millennials have decided not to have that second or now third child. Generations of only children have come to rely on the support of two sets of grandparents to help them raise their children, especially as more Chinese women have entered the workforce. Moreover, they do not see the interest or the value of siblings – a foreign concept in the country.
Diaper manufacturers – and their suppliers – had high hopes in the relaxation of the one-child rule and many have increased their investments in anticipation of a baby boom. Since this “boom” never happened, these manufacturers, whether local or multinational, had to focus not only on China, but also on customers throughout the Asia-Pacific region. However, declining birth rates have been a problem across the region. Indonesia, the most populous country in the region, recorded a birth rate of 17 per 1,000 compared to 18.5 five years ago. This has led businesses in the region to find creative ways to increase their sales.
In this issue, Luna Xing of the China National Household Paper Association (see page 23) reports on the operations of 11 Chinese diaper companies and how they have responded to falling birth rates. From higher-value products — targeting China’s growing middle class — to new sales and marketing channels to increased social media efforts, these companies are working overtime to sell diapers.