7 insights into India's nutrition and supplement industry

India is 12.5 hours ahead of Boulder. I didn’t know time zones came in half increments, and I never discovered why. Fortunately, this would be the only mystery we would leave unsolved on our trip to India for the New Hope/Engredea Market QuickStart program in early December 2011.  

The Market QuickStart program—an inspired vision of Len Monheit, Executive Director of Engredea—is a rolling educational tour of international nutrition industry business centers. At every stop, a brave band of New Hope and U.S. nutrition industry experts deliver day-long seminars on how to successfully do business in the United States.

In August, the Market QuickStart program kicked off in Shanghai and Beijing, with a stop at Natural Products Expo Asia in between. To learn more about Market QuickStart China, read a sampling of my thoughts here or download the most recent NBJ Global Nutrition Industry Overview issue here.

We presented the Market QuickStart program in Mumbai, Hyderabad and Bangalore, three of the centers of nutrition industry production and opportunity in India. Here's what I learned:

1. Supplements for the middle class

There are 1.2 billion people in India, of which roughly 300 million have the economic means to purchase dietary supplements. Poverty and hunger are rampant, but the middle class is still expanding. As with China, this middle class may prove a saving grace of the maturing U.S., European and Japanese nutrition industries.

Interestingly, consumers in India defer to their ayurvedic doctors for direction on health supplements and ayurvedic herbs, $600 million and $2 billion markets, respectively.  

Indians are already exposed to nutritional ingredients entering the market through functional foods, which sets the stage for dietary supplement opportunity as a growing middle class becomes more interested in self care.  

Practitioner channel players may be early winners here, because sources of product education and information besides doctors still need to be developed. 

2. Low manufacturing and supply costs

India has cornered the generic drug market with its incredibly low costs. An obvious opportunity for U.S. firms is to utilize India’s low-cost, pharmaceutical-grade production facilities to cost-effectively fuel their U.S. and international expansion. If you don’t like manufacturing in China, maybe India is for you.

3. Ayurvedic market more prominent in India

The Indian Ayurvedic market is estimated at $2 billion. By contrast, Nutrition Business Journal estimates that the U.S. Ayurvedic market is $30 million. A well-organized reinvestment by Indian firms in the U.S. Ayurvedic market appears to be on the horizon. Working with Indian Ayurvedic firms to improve the image of their products in the United States could lead to a long overdue sales increase for players this category.

4. Regulation frustration

Some manufacturers and marketers of finished products were frankly aghast at the challenges faced by supplement marketers in the United States regarding what they could say, label and reference on their websites—especially when armed with relevant clinical trials.

Keeping Indian firms up to speed with U.S. regulations represents both a challenge and an opportunity for experienced U.S. firms to help these Indian manufacturers and marketers enter the U.S. market as partners.

5. Supplements pharmaceuticals?

The success of Lovaza, a fish oil drug available only through prescription in the United States, has mesmerized (or frightened) many in and around the nutrition industry. Over $1 billion in sales will do this.

Today, the sales of Lovaza rival (or exceed) that of the entire fish oil supplement market in the United States. Chatter among industry elite as to which supplement category might find itself competing with its own Rx versions—and which pharmaceutical companies are chasing this dragon—has fueled many a conference cocktail party.

But perhaps executives ought to worry less about hamstrung opportunities in the maturing U.S. market and turn their attention to India, where a similar scenario is playing out already in this emerging market.  

The largest supplement brand in India—ShellCal, a calcium/vitamin D combo product sold via doctors’ prescriptions—is only worth $70 million. With excellent pharmaceutical manufacturing, a growing interest in supplements and a fast-growing economy, perhaps the future of “supplement pharmaceuticals” for supplement companies is in India.

6. Health is a problem

Indians don't exercise much and so many develop health problems between the ages of 30 to 35. Not surprisingly, the most pressing health conditions in India include diabetes, joint health, bone health and cardiovascular disease. U.S. companies are encouraged to partner with Indian companies and bring expertise in consumer research, education and marketing to help develop supplement solutions for these health conditions. Indian supplement executives are interested in how to develop demand for their products.  

7. Hustle isn't a problem

The Indians seem more inquisitive than the Chinese with a hearty dose more natural business hustle. The inquisitiveness may just be a misperception on my part because most Indians we met spoke very good English and the Chinese generally didn’t. But certainly the business hustle of the Indians was on a higher level than the Chinese.  

In fact, Engredea and New Hope's Monheit described his visit to the annual Convention on Pharmaceutical Ingredients (CPhI) tradeshow in Mumbai as "a lesson in tradeshow efficiency. I was amazed at the assertiveness of attendees, their level of energy and engagement, and the fundamental professionalism—by any international standards—that I witnessed across the entire show floor."

The Bottom Line

Visiting India was an intense experience.  The poverty, the beauty, the opportunity—they were all overwhelming. The people, however, were the greatest treat. Warm, friendly and very open, the Indians certainly deserve their place on the short list of countries that will actively shape the future of the global economy. My money is on India to have the greatest impact. 

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