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    Breaking News

    Health Products Association-China Holds Annual Supplement Seminar

    Association’s ninth annual event at ExpoWest offered insight on China's dietary supplement market.

    Health Products Association-China Holds Annual Supplement Seminar
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    03.29.19
    HPA-China hosted a 2-hour seminar during Natural Products ExpoWest that featured sevent expert speakers who offered the latest information on China’s supplement industry.
     
    The presenters spoke to an audience of 240 industry leaders, entrepreneurs, consultants, media and government officials. Here are some of the key takeaways.
     
    China’s supplement regulatory environment is shifting toward a more transparent system. Although that is a good signal, it is also becoming more stringent. Resulting in only 11 approvals in 2018.
     
    The Chinese government officially calls the industry “Health Food Products,” which holds a broader definition than dietary supplements. As a result, there are overlaps with other categories like Food, Traditional Chinese Medicine and OTC, making the industry a bit difficult to track.
     
    China’s official figures for the 2018 Health Food Industry are US$59 billion in sales with a growth rate of 10%. However, other groups place the figures closer to US$30 billion with 8% growth. Either way, the industry is growing rapidly and is safely listed as the second largest market for supplements just behind the U.S.
     
    China FDA is no longer in charge of the supplement industry. A new agency called State Administration of Market Regulation (SAMR) was created in April 2018 to oversee a variety of industries and consumer protection initiatives, which includes the supplement industry.
     
    Informa, organizer of Expo West and new owner of UBM Exhibitions, has a wealth of expo offerings in China. Most notably for the supplement industry is its FiAsia China Ingredient Expo and HNC Expo for finished branded supplements. Both of which take place together this year in Shanghai June 19-21. Prior to this expo, HPA-China will hold two summits. The first being “Nutrition and Health China Industry Summit” on June 17, and the second “Probiotics China Summit” on June 18. For more information on these two summits, visit the association’s website HERE.
     
    WeChat remains China’s most important social media platform for communication, business, marketing/branding and electronic payment methods in China. WeChat mini-programs are becoming ubiquitous and play an increasing role in companies’ abilities to directly market and attract customers.
     
    Cross border E-commerce (CBEC) is the most popular way for international supplement companies to approach the China market. It allows most products to be sold directly to China’s consumers without government approvals, label changes or reformulation through a variety of platforms. Tmall.hk and Kaola.com are two of the most popular platforms.
     
    In order to directly sell supplements in China without utilizing CBEC, products must be registered or recorded (filing system). Registration typically costs in excess of US$100k and can take approximately 3 years to complete. Recording (Filing) costs over US$18k and takes less than one year to complete.
     
    When approaching the China market don’t forget about the millions of Chinese living overseas and/or the inbound Chinese tourists. Both groups have strong connections to China and offer a valuable way to influence buying decisions of their family and friends back in China.
     
    Alibaba’s Tmall Global is launching a new system called TOF (Tmall Overseas Fulfillment). This new system is targeting small and medium sized enterprises to help them reach China’s consumers with less risk and investment. In the case of the U.S., products will be stored in a Los Angeles warehouse and shipped to consumers directly. It is a consignment model.
     
    If you’d like to hear the two-hour recorded seminar or review the slides, send HPA-China an email at info@uschinahpa.org and request the link and password.
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