The global testing, inspection and certification market was valued at USD 335 billion in 2021. It is anticipated to reach USD 457 billion by 2030, growing at a CAGR of 4% during the forecast period (2022–2030).
Secure and effective testing and inspection methods ensure businesses maintain the highest quality standards and maximum production and efficiency. Using TIC methods allows companies to tailor their supply chain activities to their specific needs and objectives, simplifying business practices. The increase in outsourcing of testing, inspection and certification services by prominent companies operating in the manufacturing, automotive, and consumer goods application areas is projected to boost the growth of the TIC market. The rising need for enterprises and corporations to engage in safe and efficient testing, inspection and certification practices promotes market growth for the TIC market.
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Due to the increasing number of regulations and standards, the in-house inspection, testing and certification of products have become costlier. Therefore, several players in the industry have started outsourcing the TIC services to third-party service providers. For instance, with the rise of third-party inspection regulation internationally and the rigorous application of CCC certification in China, the revenue of the outsourcing segment is expected to grow over the forecast period.
Increased outsourcing of TIC services is anticipated to appear as one of the prominent factors for companies in the global TIC market. Independent TIC service providers play a significant role in supporting the government in fulfilling its mandate of protecting consumers from unsafe or harmful products. For instance, The Compulsory China Certification covers over 23 product categories such as wires, cables, appliances, consumer goods, and automotive parts. Therefore, with the rise in revenues in the automotive, industrial, and consumer goods sectors, the demand for testing services has substantially increased in China, which has compelled the government to open its market to international players. With the rise of third-party inspection regulation internationally and the rigorous application of CCC certification in China, the revenue of the outsourcing segment is expected to grow over the forecast period.
Emerging digital technologies are playing a significant role in the testing, inspection, and certification (TIC) market over the coming years. Many TIC activities are expected to be performed digitally in the coming years. There will also be TIC activities developed for new digital services and products. For instance, in September 2021, VeChain Foundation, a China-based enterprise-friendly blockchain technology provider, announced a partnership with Centre Testing International Group Co. Ltd., a China-based TIC service provider. The initiative aims to create green technology while calculating the carbon emission of the VeChain Foundation public blockchain network.
Several technologies essential in offering better TIC services include augmented reality, next-generation automation, blockchain, connected devices, big data & analytics, cloud & cybersecurity, and smart sensors. These digital technology trends would also deliver access to massive data, enabling TIC companies to create new value-adding services. In addition, revenues from TIC services for products such as car emissions and internal combustion vehicles are expected to drop. However, revenues from the new digital product would substantially compensate for this decline. As products become technologically more complex, the products would require more frequent and intense TIC. The global TIC market would grow significantly over the projected duration.
A lack of internationally accepted standards significantly restrains the TIC market growth. These varying standards influence the manufacturer's decision-making about exporting a specific product to a given country. There are also various regulations and standards for different services or products. Complying with international standards usually results in increased costs as it may lead to changes in the design of a particular product or service. For instance, the domestic players in Chinese provinces capture most of the TIC market. This is attributable to the mandatory compliance with the China Compulsory Certification (CCC), which hinders most international players from using other standards.
Furthermore, some other measures, such as Guobiao (GB) standards, provincial standards, and industry standards, favor the growth of domestic players. Nonetheless, the government has encouraged foreign investments in the TIC market by lifting the barriers for international TIC providers to enter and operate in the mainland marketplace. Looking at the immense market potential generated by raising barriers to entry, key market players such as SGS and Bureau Veritas have begun investing in this market. These factors are considerably impacting the market growth.
The infrastructure and transportation sectors are continuously developing in the growing economies. Testing, inspection, and certification are pivotal in these sectors. Due to the increasing demand for the continuous development of transportation facilities such as roadways and railways, the market is expected to have a significant growth opportunity. Economic growth promotes upgrading the national infrastructure that acts as a catalyst for the market growth in various growing economies such as India and China. For instance, in February 2021, the Vietnam government released a draft of the country's latest national power development plan. It includes expansion of non-hydro renewable capacity and increases in wind and solar capacity.
The increasing implementation of renewable energy generation projects is also expected to boost the demand for the TIC market. For instance, in 2017, the Indian market was ranked second for being the most attractive Renewable energy market globally. The country has set the world's most extensive expansion plan of 175 GW of renewable power by 2022. This renewable power includes 5 GW from Small Hydropower, 10 GW from Biomass power, 60 GW from Wind power, and 100 GW of Solar energy. Therefore, such investments taken by the respective governments in infrastructure and power plant development are expected to boost the market growth of testing, inspection, and certification in the countries.
The global testing, inspection, and certification market is segmented by service type, sourcing type, application, and region.
By service type, the global testing, inspection, and certification market is segmented into Testing, Inspection and Certification.
The Testing segment accounts for the largest market share and is estimated to grow at a CAGR of 3.7% during the forecast period. This is due to the extensive usage of testing procedures in the manufacturing, energy, utilities, oil, gas, and automotive industries. Product testing in the real world helps businesses maintain high standards and satisfy client demands. This encourages firms from various sectors to invest more in operational expenses for testing equipment, fostering market expansion.
Certification is the fastest-growing segment. The construction and infrastructure industries pave the way for market growth in the certification segment. This is attributable to the widespread applications of certified technologies and materials in the construction and infrastructure industry—continuous efforts from regional government authorities to improve safety practices in the transportation sector fuel the market growth. For instance, the US Transit Safety and Security Division provide authorizations that help in improving market penetration.
By sourcing type, the global testing, inspection and certification market is segmented into In-house and Outsourced.
The In-house segment accounts for the largest market share and is estimated to grow at a CAGR of 3.6% during the forecast period. Implementation of in-house inspection and testing systems empowers businesses to perform practical TIC activities owing to the ability to hire talent and on-site availability. The companies can also set up custom practices by the desires and requirements of the company. Moreover, positioning in-house TIC teams provide a deeper understanding and improved control of operational practices, which will benefit the organizational viewpoint.
The Outsourced segment is expected to grow with the highest CAGR during the forecast years. The companies in the outsourcing segment focus on short-term commitments and cost-effectiveness. These companies also help businesses implement TIC practices with various engagement models such as materials and time, hourly, dedicated team, etc. This, in turn, enhances the efficiency of the system.
By application, the global testing, inspection, and certification market is segmented into Consumer Goods & Retail, Agriculture & Food, Chemicals, Infrastructure, Energy & Power, Education, Government, Manufacturing, Healthcare, Mining, Oil & Gas and Petroleum, Public Sector, Automotive, Aerospace & Defense, Supply Chain & Logistics, and Others.
The Infrastructure segment accounts for the largest market share and is estimated to grow at a CAGR of 4.7% during the forecast period. Rapidly increasing urbanization and demographic changes are compelling government investments for developing transport and water infrastructure, augmenting the demand for tested and certified materials and techniques, and paving the way for new entrants. For instance, in August 2020, ALS started providing companies with wastewater testing and analysis services.
Consumer Goods & Retail is the second largest segment. Due to the increased inspection actions carried out by businesses in the segment, the consumer goods and retail sector has increased its revenue share significantly. Consumer goods companies must adhere to several quality norms and requirements to provide their clients with the highest quality products. This makes it easier to implement comprehensive inspection systems that are very effective, providing the market with development potential. Additionally, retail businesses must ensure customers have access to the best products and customer experiences, further increasing the penetration of TIC services and technologies and supporting market expansion.
By region, the global testing, inspection, and certification market is segmented into North America, Europe, Asia-Pacific, South America, and the Middle East and Africa.
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Asia-Pacific accounts for the largest market share and is estimated to grow at a CAGR of 5.2% during the forecast period. The most dynamic markets for testing and inspection in Asia-Pacific are China and India, attributing to substantial growth in the manufacturing sector and increased exports from the countries. The food products export is a prominent contributor to increasing export from India. The primary exports include fish, shrimp, clams, mussels, cuttlefish, octopus, squid, crabs, etc. The prominent markets for these products are the US and Japan. Seafood exports from India must adhere to a particular country- or region-specific regulations. On the back of this, inspection and testing in the food industry are projected to ascend at significant growth rates. With this, the food regulatory agency Food Safety and Standards Authority of India (FSSAI), can create transparency in food safety inspection and sampling.
Europe is the second-largest region and is estimated to reach an expected value of USD 130 billion by 2030, growing at a CAGR of 3.4%. The increasing investments in construction and infrastructure development are expected to fuel market growth in the European region. The technological developments coupled with the growing prominence of the IoT have positively influenced inspection and maintenance by introducing predictive maintenance. Additionally, the rising emphasis on reducing machinery and equipment downtime provides the impetus for the growth in demand for testing, inspection, and maintenance of critical systems and assets. The prevalence of many market participants and high competitive intensity has increased merger and acquisition activities across the TIC industry. The top market participants are focusing profoundly on the acquisition and merger strategy to enhance their revenue growth.
North America is growing steadily, owing to a significant increase in international exports and imports, particularly for medical and food products. Rapid technological progressions, leading to product diversity and, in some cases, reduced life cycles, are anticipated to fuel the demand for TIC services. The increase in food safety audit powers the demand growth in countries such as the US and Canada. In September 2019, the FDA (Food and Drug Administration Authority) introduced the Food Safety Modernization Act to transform the food safety system in the US, with its prime emphasis on the prevention of foodborne infections. With this act, the government implied various quality standards for food products. This, in turn, results in steady growth in the number of TIC activities in the country.
The key players in the global testing, inspection, and certification market are
Frequently Asked Questions (FAQs)
|Market Size||USD in 457 Billion By 2030|
|Forecast Units||Value (USD Million)|
|Report Coverage||Revenue Forecast, Competitive Landscape, Growth Factors, Environment & Regulatory Landscape, and Trends|
|Segments Covered||by Type (In-House, Outsourced), Application(Commodities, Industry, Life Science, and Pharma)|
|Geographies Covered||North America, Europe, Asia-Pacific, LAME, and the Rest of the World|
|Key Companies Profiled/Vendors||SGS Group (Switzerland), Bureau Veritas (France), Dekra Certification (Germany), Intertek (U.K), TUV SUD (Germany), Eurofins Scientific (Luxembourg), DNV (Norway), TUV Rheinland (Germany), UL LLC (U.S.), ALS Limited (Australia), TUV Nord Group (Germany), Mistras Group (U.S.), SAI Global (Australia), BSI Group (U.K), Element Material Technology (Exova Group Plc) (U.K),|
|Key Market Opportunities||
Development in Infrastructure and Renewable Energy Generation Projects in the Growing Economies