TopGum solidifies US market presence with organic certification
The company, with headquarters in Tel Aviv, launched its functional gummy segment in 2019 after years of making confectionary gummies following its founding in 2004. It first expanded into the US in 2021 by opening an office in New Jersey, after securing an investment from AP Partners Fund, also based in Tel Aviv.
Now the company has secured an USDA-certified organic mark, after an exhaustive audit of its production facility in Israel and an audit of its supply chain. The audit, which was performed by what the company called ‘an authorized international Organic Certifier,’ verifed the company’s manufacturing facility and the provenance of its ingredients all matched the strict standards laid out in the USDA organic regulation.
New certification called milestone
“Receiving formal organic certification entails a lengthy and complex process and marks an important milestone for us,” said Doron Delouya, VP of product at TopGum. “Globally, consumers are becoming increasingly attuned to the wellness qualities, the source of the ingredients and the environmental footprint of the foods and supplements they consume.”
TopGum claims that the gummy opportunity remains bright in the US. According to market research from Innova Market Insights cited by the firm, gummy supplement launches increased by 33% average annual growth in the US from 2015 through 2019. The top health positionings in the US include immune, skin, bone and mood health. The top 5 subcategories of gummy supplements in the US are vitamins/minerals, probiotics, botanical supplements, hair, skin & nails and women specialty. Over a half of the gummy supplements in the US are vitamins/minerals. Most sources place annual global gummy supplement sales at $5-6 billion, with North America accounting for nearly half.
Further Innova research revealed that the 18-25 age group prefers gummy supplements over all other supplements format (including functional food and beverages) while the 26-35 group prefers functional food & beverages and gummy supplements to classic supplement formats. Over the first eight months of 2021, one quarter of vitamin and mineral launches were gummies. Gummy supplements have experienced double-digit growth (CAGR 16%) from 2016 through 2020. Vcaps (vegetarian caps) were 21% of launches (2021 YTD), up 5% in launch count CAGR.
All of that led TopGum earlier this year to announce a massive expansion of it production capability with a new 120,000 square feet (11,000 m2) plant to be located about a 1.5 hour drive south of Tel Aviv. The facility will join the company’s existing plant and is expected to be up and running in mid-2023.
TopGum occupies a special niche in the market with the launch of its patented sugar-free Gummiceuticals whose formula is based on inherently sweet prebiotic fibers.
“We have implemented our proprietary technology to formulate an uncompromised organic gummy matrix and a state-of-the-art computerized system for traceability across the production chain, from raw materials to finished product,” explains Delouya.