UK supplements market to drop 1.9% in 2011-2012 as recession bites
Researcher Key Note fingered the depression as the main cause and said the market it valued at £364m (€436m) in 2010 had been declining for three consecutive years and would fall again by 1.9% this year.
“The prolonged recession, rising inflation and unemployment rates have forced many consumers to cut back their spending on non-essential items, including vitamins, minerals and supplements,” it said.
"The best-selling vitamin products included multivitamins, vitamins B and C. By contrast, sales of fish oils and plant oils have been dwindling over the past few years."
But it predicted a return to growth in 2012-2013, driven by an ageing population concerned with anti-ageing and heart, cognitive and joint health issues.
The market would be worth £389m (€466m) in 2015-2016, Key Note said in its report, Vitamins, Minerals and Supplements.
“robust and encouraging”
Graham Keen, the executive director of the UK Health Food Manufacturers’ Association (HFMA), said the small drop in market size represented a solid industry performance, and warned of greater threats in the form of European Union food regulations.
“We feel that the numbers in this report, given the climate in the high street, are surprisingly robust and encouraging. In the harsh economic trading environment we are currently enduring, it might have been reasonable to expect a more significant downturn,” Keen told NutraIngredients.
“Our great concern going forward is that the upbeat market projections in the report will be endangered by the constant tidal wave of restrictive and damaging legislation coming out of Brussels that will ultimately only cause to suppress innovation, reduce consumer choice and particularly hit hard the small and medium size companies that are the heartbeat of this industry.”
Julie Hayward, the executive secretary at the Council for Responsible Nutrition UK (CRN-UK), agreed, “the economic downturn is the key factor” in the figures.
“positive marketing practice”
However, she downplayed the effect of EU lawmaking in the area of health claims and maximum permitted levels of nutrients in supplements.
“I would not believe that EU regulation is having an impact as yet since the community list of claims is not yet in place and so has not led to the removal of specific claims from packaging,” she said.
“We are yet to learn whether or not the removal of claims will lead to loss of sales. However, positive marketing practice, such as brand building, should play a key role in ensuring that brands are still highly regarded by consumers.”
“We definitely do experience a sharp decrease in sales when we see negative publicity in the national press; however, sales often then return to their usual positions and also can be seen to increase after the decrease.”
Health disciples
Cheryl Thallon, the founder of €3m, 11-year-old UK supplements manufacturer, Viridian, said her business had experienced no downturn, but noted its premium, health channel range was less likely to be affected by the recession as more fickle mass market consumers may be.
“The specialist market is holding its own because supplements are essential to healthy consumers,” Thallon told NutraIngredients.
“In this way we are less affected by the health claims regulation because our consumers know why they are buying the products, they have the health benefit knowledge. That is why we make no health claims on our products anyway.”
She noted 100% annual growth in vitamin D; 3-5% growth in vitamin C; 21% growth in zinc; 20% in folate and 66% growth in coconut oil.
Flax oil sales had fallen 7%.
