Abstract: With the implementation of the “Healthy China” strategy, the Chinese nutrition and health industry will usher in new development opportunities. Economic development will lay a solid foundation for safeguarding people’s health; consumption upgrades will create broad space for the development of health industries; technological innovation will provide strong support for improving health.
1. The industry has great potential for development
From the perspective of the stage of industrial development, the Chinese dietary supplement industry is still in its infancy and there is plenty of room for growth in the future. Dietary supplements are optional consumer products. From the perspective of industry development in developed countries, the core factor that promotes industry growth is the rapid increase in demand. The strong health demand will promote the rapid rise of the industry in the short term.
1.1 The trend of demand-driven industrial development remains unchanged.
Living standards have improved, and higher requirements have been put forward for the quality of life after adequate food and clothing. The consumption trend has shifted to healthy foods with reasonable nutrition and health care functions. In the face of increasing aging, increasing incidence, increasing chronic diseases, and increasing sub-healthy populations, the public’s demand for health care is gradually increasing. With the further deepening of medical reform, the demand for medical care is increasing rapidly, and the strategy of medical and health is gradually shifting from treatment to prevention, which provides a good external environment for the growth of the industry.
1.2 The improvement of health literacy boosts the development of the industry.
The improvement of consumers’ overall knowledge level has gradually increased their health awareness, and the public’s understanding of health products has become more objective and rational, and they have also used health products more rationally, dietary supplements based on nutrition and preventive medicine. Products will be more easily accepted by the new generation of consumers. Government departments are also taking improving people’s health literacy as an important task for a while in the future. Starting from January 8, 2019, 13 departments including the State Administration for Market Regulation have carried out a 100-day “Hundred Days Action” nationwide. In May 2019, the State Administration for Market Regulation organized a nationwide special science promotion campaign for health food “Entering the community, entering the countryside, entering the network, entering the campus, entering the supermarket”, aiming to enhance consumers’ awareness of rational consumption and self-protection Awareness, to build a popular science propaganda network involving all parties in the society. On May 20, the “Opinions of the Central Committee of the Communist Party of China and the State Council on Deepening Reform and Strengthening Food Safety Work” was released. This is the first food safety work document issued in the name of the Central Committee of the Communist Party of China and the State Council and is of great significance.
2. Collaborative innovation boosts industry development.
With the development of the market and the intensification of competition, in order to further seek product differentiation and originality, terminal product research and development companies carry out product technology research and development from all dimensions
2.1 Research on technology and function of raw materials from upstream
The dietary supplement industry is a whole industry chain covering the upstream and downstream of raw material suppliers, product providers and product distributors. In the past, as a mainstay product provider, product R&D efforts were mainly focused on the formulation of product formulations and the experimental research of health care functions. With the development of the industry and the upgrading of consumption, we can see that more and more product research and development companies have begun to actively cooperate with upstream raw material suppliers. For example, BY-HEALTH has established a joint R&D platform and industry alliance with raw material suppliers. Combine raw materials and products for systematic development. On the one hand, it can shorten the product development cycle, promote the replacement of new and old products, and seize the market; on the other hand, it can guide and cooperate with raw material suppliers to conduct in-depth development of the raw material in terms of function orientation and market application through the terminal market demand. Thereby promoting technological upgrading and product innovation in the dietary supplement industry. For example, BY-HEALTH has established a joint R&D platform and industry alliance with raw material suppliers. Combine raw materials and products for systematic development. On the one hand, it can shorten the product development cycle, promote the replacement of new and old products, and seize the market; on the other hand, it can guide and cooperate with raw material suppliers to conduct in-depth development of the raw material in terms of function orientation and market application through the terminal market demand. Thereby promoting technological upgrading and product innovation in the dietary supplement industry.
2.2 Research and development of innovative new functional health food.
The output of dietary nutritional supplements at the product development end includes categories such as registered health foods and registered health foods. The introduction of the health food filing system lowered the industry threshold, stimulated market vitality, and promoted innovative applications and development in packaging and dosage forms. Regarding registered health foods, the leading companies in the industry have assisted the State Administration to sort out and improve the existing 27 health function evaluation methods and review systems; on the other hand, they are actively carrying out exploratory research and development of innovative new functional health foods. From the perspective of policies and regulations, the health food function claim and its review system may undergo major changes in the future. Innovative research and development of new health food functions is an inevitable trend in the development of the industry.
3. Categories will be more diversified
Vitamins and minerals will remain the largest category. Whether in developed markets in Europe and America or emerging markets such as China, vitamins and minerals are the largest categories of dietary supplements. In the United States, vitamins and minerals have always accounted for more than 30% of the market share. In China, the problem of insufficient intake of vitamins and minerals still exists. It can also be seen from the category of imported dietary supplements in my country that the import volume of vitamin and mineral products also ranks higher. The import value of vitamin products reached 500 million US dollars, and the import value of calcium supplement products reached 170 million US dollars.
Functional foods and beverages will become more popular. In recent years, functional foods and beverages containing nutrients such as vitamins and minerals have become increasingly popular. Such products taste good, are convenient to eat, and can also supplement dietary nutrients, and are highly praised by consumers. For example, in snack bars, nearly one-third of consumers consume snack bars to increase their intake of vitamins and minerals. According to statistics, the combined market of functional food and beverage products currently has a global market value of approximately US$253 billion. There is a strong demand for dietary supplement products in the subdivisions. With the upgrading of consumption structure and the change of consumer perceptions, the functional product market is undergoing more and more severe tests. Keywords such as health, nutrition, personality, and convenience have become hotspots, and functional requirements are becoming more and more subdivided and professional. Dietary supplements in subdivisions such as oral beauty, weight management, sports nutrition, and probiotics are showing rapid growth. Even in the same functional category, there are different product formulas for different genders and different age groups. Dietary supplement products in subdivisions are increasingly being valued by the industry.
4. Future consumer trends
Generation Z will become the main force in the consumption of dietary supplements. Generation Z, people usually define as a generation born in 1995-2010. They are the “indigenous people” of the mobile Internet world and grew up in an environment of deep digitization and extensive networking. They are particularly prominent in the acquisition and utilization of resources, continuous learning and thinking, diversified absorption and tolerance, innovation, and entrepreneurial awareness. Generation Z pays more attention to details and quality and respects exquisiteness rather than a luxury. They are willing to pay the price for the pursuit of a better life. Take traditional tonic product bird’s nest consumption as an example. According to Tmall’s data, post-85s and post-90s are the main consumers of bird nests. The proportion of people and the contribution of the amount are close to 60%. The consumption power of post-95s has increased rapidly. “Awareness increased. Precision nutrition (individualization) is the general trend of industry development.
In October 2016, the “Outline of the “Healthy China 2030″ Plan” was issued, which raised national health to the national strategic level. In 2017, the “Thirteenth Five-Year Plan for Food Science and Technology Innovation” issued by the Ministry of Science and Technology of China included nutrition and health as a key task, and for the first time emphasized precise nutrition and technology. As an important intervention method that can effectively promote human health and prevent diseases, “precision nutrition” can play a positive role in improving the overall nutritional health and quality of life of the people, and it will have a large space for development in the future. Throughout the development of China’s dietary supplement industry in recent years, leading companies such as By-Health, Ailand, BGI, etc. have actively carried out research and development of precision nutrition-related products and technologies. For example, BY-HEALTH and the Shanghai Institute of Biological Sciences of the Chinese Academy of Sciences jointly established the “Precision Nutrition Research and Transformation Industry Alliance” in 2017. At the same time, large overseas multinational companies such as Nestlé are also actively deploying precision nutrition-related technology and application research. “Precision nutrition” has become a hot spot in the global development of the dietary supplement industry.
Professional promotion will improve the overall level of the industry. As the country pays more and more attention to the big health industry, many pharmaceutical companies are also involved in the dietary supplement industry, a large number of pharmaceutical industry practitioners enter the field of dietary supplements, and standardized manufacturing management and professional academic promotion concepts in the pharmaceutical industry will gradually be introduced into the industry. Among them, it will promote enterprises to increase investment in R&D and clinical fields, thereby driving the overall level of the entire industry.
E-commerce sales will continue to rise. According to statistics, as of the end of 2018, the Ministry of Commerce has issued a total of 91 direct sales licenses. Direct sales are the largest sales channel for dietary supplement products in my country, accounting for nearly 50%. Other major sales channels include stores (including pharmacies), E-commerce (including social e-commerce and cross-border e-commerce). This is very different from the sales pattern of developed countries (the sales of European and American stores are relatively developed, and direct sales account for less than 30%). At present, my country is the world’s largest online retail market. In 2018, the scale of e-commerce transactions was 31.6 trillion yuan, of which online retail sales exceeded 9 trillion yuan, a year-on-year increase of 23.9%. The online retail sales of physical goods exceeded 7 trillion yuan, accounting for social The proportion of total retail sales of consumer goods has reached 18.4%. In this general environment, the online sales, sales varieties, and sales volume of dietary supplements will continue to rise and will become an important consumption channel. For overseas dietary supplements, cross-border e-commerce will still enter China. The main channel of the market.
