China’s Dietary Supplement Industry Market Insights Natural Products Expo West – March 11, 2017 Your Trusted China Partner
Market Overview Your Trusted Partner in China
Source: McKinsey & Company Your Trusted Partner in China
Consumer Confidence Index Your Trusted Partner in China
“Health Food” Industry Figures $64 billion China Health Care Association 2014 $34 billion Chinese Industrial Information Network 2015 $29 billion CHYXX Industry Website 2015 $20 billion ASKCI Research Academy 2015 $18 billion Euromonitor 2015 $15 billion SOHO Website 2015 n o i l l i b 5 2 $
Regulatory Your Trusted Partner in China
CFDA’s “Blue Hat” Registration for Health Food This is the year it was This is the CFDA approved and its Functional corresponding product logo with certificate number. Chinese statement “G” indicates it is a which means domestic product health food product. This means China Food and Drug Administration (CFDA) . Your Trusted Partner in China
Registration Costs – Need to hire registration consultant – Registration fee in excess of $150,000 per SKU – 2-3 years waiting period Your Trusted Partner in China
New Recording Process Begins: May 1, 2017 – Need to hire registration consultant – Recording fees approximately $15,000 – 1 year waiting period Your Trusted Partner in China
Blue Hat Registration Costs Item Fee (¥) Fee ($) ¥350,000 $56,452 Agent Fees 咨询费 ¥70,000 $11,290 Toxicology test 毒理痢性测试 ¥80,000 $12,903 FuncAon appraisal test （ animal ）动物实验 ¥200,000 $32,258 Func%on appraisal test （ human ）⼈亻体试验 ¥60,000 $9,677 Hygienically and stability test 卫⽣甠和稳定性试验 ¥30,000 $4,839 Efficacy composiAon evaluaAon 功效成分评估 SAmulant / banned substance test 兴奋剂 / 禁⽤甩物 ¥10,000 $1,613 质检测 ¥15,000 $2,419 Microbial idenAficaAon 微⽣甠物检测 ¥15,000 $2,419 Microbial toxicity evaluaAon 微⽣甠物毒性检测 ¥50,000 $8,065 Review inspecAon 评定审查 ¥880,000 $141,935 TOTAL 费⽤甩总计 Your Trusted Partner in China
History of CFDA Registrations 1996 – 2016
Professional Shoppers 3 – 10 Times Compensation Numerous lawsuits against global companies Your Trusted Partner in China
Sales Channels Your Trusted Partner in China
• High-end Supermarkets • Shopping Mall Kiosks • Health and Beauty Store Watson’s Mannings • Pharmacies • Direct Sales (MLM) • E-Commerce Your Trusted Partner in China
• E-commerce allows for entire market penetration • Even Remote Areas Have Smart Phone Access • 1 billion Active Users across digital platforms Image Source: McKinsey & Company Your Trusted Partner in China
Trends Your Trusted Partner in China
Investment in Foreign Companies Buyer AcquisiAon / CooperaAon Year Price (US dollars) Kingdomway Doctors Best Holdings 2014 35 million Sinolife Good Health 2014 18 million BiosAme SWISSE 2015 1.3 billion Kingdomway Vitatech 2015 96 million Sinolife HeJian 2015 26 million DSM Jiang Shan PharmaceuAcals 2015 ConfidenAal By-Health Nature’s Bounty 2016 17.39 million Pfizer TREERLY 2016 ConfidenAal XiWang Group Muscle Tech 2016 730 million Kingdomway Kaluli 2016 3 million Shanghai Pharma Vitaco 2016 136 million IVC Perrigo 2016 ConfidenAal Ausnutria NutriAon Care 2016 19 million Aland Brunel Healthcare Manufacturing Ltd. 2016 ConfidenAal Aland Biocare Ltd. 2016 ConfidenAal Aland IVC 2016 ConfidenAal Sirio Ayanda 2016 ConfidenAal Kingdomway Labrada Bodybuilding NutriAon 2017 8.1 million Tasly Holding Group Herbalife 2017 ConfidenAal
Blue Hats Difficulties Competing with Cross Border E- Commerce Pricing Cross Border Most Global Brands China Business is in Cross Border E-Commerce Trade Wars? Your Trusted Partner in China
Introduction to U.S. – China Health Products Association Your Trusted Partner in China
Established: July 28, 2010 Status: U.S. Non-Profit Organization Model: Traditional Association / Business Consultancy Your Trusted Partner in China
Working directly with Government Entities Translation and Regulatory Comments Industry Working Group U.S. Shanghai Consulate Product Approvals Customs Clearance Trade Marks Partner Search Overall market solutions ……… Your Trusted Partner in China
Association Annual Conferences: China Dietary Supplement Industry Insights Natural Products Expo West - March Anaheim U.S.A International Nutrition and Health Industry Summit FiAsia / HNC Expo - June Shanghai, China International Omega-3 & Probiotics Industry Seminar FiAsia / HNC Expo - June Shanghai, China International Sports Nutrition Industry Summit FIBO China – September Shanghai, China China Ingredient & Supplement Industry Insights SupplySide West – October Las Vegas U.S.A.
Weekly English NewsleAer Weekly Language NewsleAer ”China Updates” “Health Weekly – 健康周 报 ” www.uschinahpa.org www.chinaushpa.org
SOCIAL MEDIA Launched WeChat Group - December 1, 2014 Your Trusted Partner in China
China Expos May 16 – 18, 2017 Shanghai National Exhibition and Convention Center
China Expos June 20 – 22, 2017 Shanghai New International Expo Center
China Expos September 7 – 9, 2017 Shanghai Convention & Exhibition Center of International Sourcing
Jeff Crowther Executive Director jcrowther@uschinahpa.org THANK YOU www.uschinahpa.org Your Trusted Partner in China
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