“A condom is a barrier device commonly used during sexual intercourse to reduce the probability of pregnancy and spreading sexually transmitted diseases. It is put on a man's erect penis and physically blocks ejaculated semen from entering the body of a sexual partner”. Condoms are therefore medical devices which are used to maintain a good health care. It is in the government’s best interest to subsidise or provide them entirely free so that consumption is not limited to those who can afford them. This is why they can be defined as merit goods, goods which would be under provided and consequentially under consumed if left in the hands of the private sector alone. Condoms are usually made from latex, but some are made from other materials such as polyurethane or polyisoprene. There are two types of condom: male and female. However, in 2012, male condoms remain far more used than female ones. The latest official figures from the Office for National Statistics show that about 25 per cent of British women aged 16 to 49 say that the male condom is their current method of contraception. Only 2 per cent use the female condom, so it can be considered as a minor substitute product. Hence, we will be focusing on the male condom. The condom market has been described as something that "boggles the mind".. Within the condom market there are several major contributors; among them both for-profit businesses and philanthropic organizations, including numerous small manufacturers, and government-run manufacturing plants. In the UK, condoms are mainly supplied through three different distribution channels: 1. retailers and wholesalers
2. vending machines
3. the NHS (National Health Service)
The retail sector is the most important channel for condom distribution in the UK. The main retailers are the major national supermarket chains (which account for around 40% of total retail sales of condoms), Boots, community and independent pharmacies and drug stores. Boots is the largest seller of condoms, it alone accounts for around one in five condoms sold in the UK and over half of total pharmacy sales of condoms. Boots has its own brand of condoms, as does the high street drug store, Superdrug.
Vending is the smallest distribution channel, accounting for less than 10% of the overall number of condoms distributed in the UK..Vending machines are mainly located in pubs and bars and will only offer one brand of condom with a limited choice in style and size. Being located in venues which younger people attend to, vending is an important way for condom suppliers to raise awareness of their brands among the young. The NHS is the second largest distribution channel for condoms in the UK, accounting for around a third of total condoms distributed. It gives condoms free to users via NHS clinics. There has been little change in the overall structure of supply over the past ten years. SSL International Plc, through its Durex brand condoms, has consistently had a share of supply of more than 80% and Ansell has remained its most significant competitor, through its Mates brand of condoms. Other suppliers like Pasante Healthcare Limited, Trojan and Condomania, account for only an insignificant share of supply. SSL distributes condoms through all three distribution channels in the UK and is the largest supplier in both the retail and vending sectors. Ansell Limited (Mates) distributes through both the NHS and the vending sector, but it currently has limited vending machine operations and only a small share of supply to the NHS. Nevertheless, there has been both entry and exit in the supply of condoms to retailers and wholesalers in the UK. Perhaps the most notable of these has been the entry of Church & Dwight with its Trojan brand. Trojan is the biggest selling brand of condom in the US although it has not managed to gain a consistent share of supply in the UK. A number of fashion related brands (for...