Industry Trends: Global Vitamins, Supplements and Nutritionals 8/18/2016
Global Business Challenges of Vitamins and Supplements
Intellectual Property Risks — Companies can face intellectual property risks because nutritional supplements are not usually protected by patents.
Scrutiny of Ingredient Quality — Nutraceutical makers are coming under fire over the safety and quality of nutritional ingredients. Officials in Canada, Europe, and the US are cracking down on use of unapproved or banned ingredients. In 2015 the FDA revised guidelines for dietary ingredient manufacturers, including requirements for preventive controls, which could impact vitamin companies' supply chain.
Liability Risks — Nutritional supplement makers are subject to product liability claims and litigation. Individual and class-action consumer claims resulting from adverse reactions, product contamination or tampering, or product recalls may result in costs that exceed liability insurance coverage
Demand Tied to Economic Cycle — Sales of vitamins and nutritional supplements are susceptible to decreased consumer spending. Though some medical conditions might require certain supplements, many consumers view vitamins and botanical medicines as discretionary purchases. (Hoovers 2016)
Vitamin Industry Opportunities
Natural and Organic Focus -- Sourcing organic botanicals and non-GMO ingredients - instead of chemically derived or produced vitamins - could drive growth among consumers who want to know the quality of ingredients used in food and other consumable goods.
Sports Performance — The use of performance enhancement vitamins and minerals has gone mainstream. Heavy to regular-use consumers make up two-thirds of sports supplement sales, while professional athletes and body builders make up about 5%, according to Natural Product Insider. Target markets include baby boomers looking to maintain health and younger generations more aware of fitness concerns.
Weight Loss Market — The obesity epidemic across the globe has raised awareness of the issue among government officials and agencies, schools, and other health organizations. Vitamin and nutritional supplement makers that sell effective weight-loss products could help consumers better manage their weight issues.
Growth in e-Commerce — Consumers are increasingly shopping online, and retailers can respond with better online education and targeted marketing. Companies may promote nutritional supplements to a specific demographic market, such as baby boomers or active young adults. (Hoovers 2016)