“Chinese companies expanding overseas has now become a major trend happening across different industries,” Dr. He Ruikun, deputy director of BYHEALTH Nutrition and Health Research Institute, told NutraIngredients. “For BYHEALTH, we are looking at overseas expansion because we hope to establish a second channel of growth through our overseas business.”
In its annual report released on March 21, the company said it would accelerate its global market expansion this year. Meeting local consumer needs would be at the core of its overseas business expansion.
The company has established subsidiaries under the Pentavite banner and sells products predominantly in Southeast Asia, including Singapore, Malaysia, Vietnam, and Thailand. It has also set up a subsidiary in the US known as Pentavite USA INC.
It is also in the process of securing regulatory requirements to enter Indonesia and the Philippines.
As part of its expansion plans, it will focus on growing its presence in interest-based e-commerce channels and the maternal and infant nutrition brand Nature’s Bay.
“While maintaining the leading position of existing products, we will launch new products supporting kids’ growth, such as calcium and zinc and at the same time, consolidate the brand’s influence in leading mother-and-baby chain stores, and strengthen category penetration in regional chains and independent stores,” said the company in the annual report.
Chinese companies across industries have set foot in Southeast Asia in recent years. The most notable examples are automotive firms BYD and Dongfeng, toy company Pop Mart, cosmetics brands Perfect Diary and Catkin, dairy firm Yili, coffee chain Luckin and milk tea chain Chagee.
In the nutraceutical space, however, there is a lack of China homegrown brands that have managed to gain widespread traction in the region, though there are functional ingredient suppliers such as WeCare Probiotics, Angel Yeast and Sirio Pharma making strides in the international markets.
Aside from international expansion, BYHEALTH said it would also focus on growing its presence in various sales channels, such as interest-based e-commerce in China, tapping into new product opportunities in categories such as fish oil, liquid calcium for kids, probiotics and using AI to drive new product development.
FY2025 performance
Latest figures released on March 21 showed that BYHEALTH’s revenue was down 8.38% year-on-year to RMB6.27bn (US$909.83m).
Sales of its core products, including its eponymous protein powder brand and bone and joint health supplement Keylid, dipped 10.38% and 10%, respectively, to RMB3.35bn (US$486.32m) and RMB727m (US$105.57m).
Lifespace, an Australian probiotic business that it acquired in 2018, reported that revenue was down 32.01% to RMB214m (US$31.08m) in China, while its overseas business saw revenue up 16.43% to RMB934m (US$135.63).
Net profit, however, went up 19.81% to RMB$782.15m (US$113.58m).
BYHEALTH‘s revenue has declined over the years, which it said was due to stiff market competition from both international and domestic brands. In 2024, total revenue was down 27.3% to RMB6.84bn (US$943.3m).
CBEC competition a key challenge for Chinese firms
One of the main challenges faced by Chinese health supplement companies comes from the cross-border e-commerce (CBEC) space, said Dr. He.
BYHEALTH also alluded to this challenge in its 2024 annual report, where it pointed out how CBEC has facilitated competition from overseas supplement brands.
“I believe that CBEC imports have had a significant impact on China’s dietary supplement industry. This is because these products can use ingredients not yet approved in China and exceed the limits set by Chinese regulations,” she told NI.
Furthermore, their functional claims often exceed the scope of health and nutritional claims allowed in China. Such unfair competition, she said, has severely hindered the progress of the domestic health supplement industry and its drive for innovation and research.
“At first, Chinese regulatory authorities promoted CBEC imports to allow Chinese consumers to purchase high-quality overseas products without leaving home. However, in recent years, we have found that many CBEC import activities have deviated from this original intention, with inconsistent product quality and potential food safety risks,” she said.
Currently, China categorizes products imported via CBEC as personal items.
“BYHEALTH has repeatedly engaged with the relevant Chinese regulatory authorities regarding CBEC issues, hoping that the Chinese CBEC imported product market can be regulated to ensure product quality and safety, as well as protect consumer rights, and create a healthy and fair competitive environment for CBEC and domestic brands, in turn, promoting the healthy and sustainable development of the industry,” said Dr. He.
