SARS to have long-lasting impact on China's vitamins market

Related tags Vitamin Dietary supplement Euromonitor

The outbreak of SARS in China caused rapid growth in vitamin sales
and despite a slowing of demand this year, it may have a lasting
impact on the industry.

A new report on the OTC healthcare market from Euromonitor reveals that value sales of vitamins grew by 30 per cent to RMB1.07 billion (€0.1bn) last year triggered by the SARS (severe acute respiratory syndrome) epidemic last year.

Vitamin suppliers were unable to meet demand as consumers rushed to pharmacies and other retail outlets to buy vitamins, believing the products would boost their immunity level and protect them from the fatal disease. In Beijing, where the epidemic was most serious, sales were particularly strong.

Manufacturers also played on consumer fears to promote their vitamin products, some making claims as 'the strongest opponent of SARS'. Such claims prompted concern from some competitors but most will have benefited from the rapid inflation in health product sales.

During the SARS outbreak, more than 20 brands entered the vitamins sector in a period of four months, according to Euromonitor, given room to launch when top brands like Roche's Redoxon vitamin C, sold out.

The SARS outbreak also appears to have served as a wake-up call to many Chinese to prevention of disease and could have long-term benefits on the overall supplements industry.

"Sales will not be as intense as last year but it will have a halo effect, in terms of the new people it brought to the market,"​ noted Adrienne Crossley, OTC account manager at Euromonitor.

Euromonitor predicts that value sales of vitamins will grow by 14.7 per cent on average each year to 2008, a much higher growth rate than traditional west European markets.

"Most west European markets are really not growing strongly at all, by 3.1 per cent on average,"​ said Crossley, adding that this growth offers strong potential for west European companies.

"There has been a huge shift away from tonics, no longer trusted because of their poor quality and counterfeiting. New products may be perceived as more trustworthy, especially packaged products,"​ she told

Vitamin E consumption will grow particularly rapidly in coming years - although still a niche product, it double in sales between 1999 and 2003.

In addition, vitamins are expected to be a significant growth engine not only for the the whole OTC healthcare market but also dietary supplement sales too.

Supplements are becoming very fashionable in China, influenced by advertising, higher income and higher demand from those who are dieting. The range of products remains limited however in comparison to western Europe, with fish oils, ginseng and protein powders among the only non-vitamin products available.

Improving quality and considerable advertising investment in tonics could also trigger a wave of price-cutting measures from some players who are eager to ride on the wave of the growing vitamins and dietary supplements sector to gain higher sales value and achieve a greater market share, predicts Euromonitor.

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