Vitamins and Dietary Supplements Market Procurement Intelligence, Supplier Intelligence, Supplier Ranking, Pricing & Cost Structure Intelligence, Best Practices, Engagement Model, Low & Best Cost Country, Day One Analysis Report, 2020 - 2025

Category Overview

“The global vitamin and dietary supplements market is driven by the rising popularity of plant-based vitamins and dietary supplements. However, counterfeiting of products remains an area of challenge.”

The global vitamin and dietary supplements market is expected to exhibit a CAGR of 4.9% from 2020 to 2025 with capsules and tablets being the most consumable dosage form of supplements. Powder is expected to emerge as the fastest-growing dosage form from 2020 to 2025 with a projected CAGR of 6.4% from 2020 to 2025.

North America is currently the highest volume of consumers for vitamins and dietary supplements, occupying ~40% share in the global market. The consumption of vitamins and dietary supplements in the Asian region is poised to grow at the highest rate between 2020 and 2025.

Supplier Intelligence

“The global multivitamins market is highly fragmented. The top 5 players barely make up 13% of overall share. Amway, the global leader has only 4% share in the market.”

The multivitamins market is highly fragmented with several small-scale players operating at regional levels. The top 5 players barely make up 13% share, and the top 10 players collectively occupy ~21% share in the overall market. The largest player, Amway, occupied only a meager 4% share as of 2020.

The bargaining power of suppliers, therefore, is low and barriers to market entry are also low. Two of the major reasons for this are the wider variety of products available with little to nothing product differentiation and the low capital cost of new entrants.

Pricing and Cost Intelligence

“Raw materials are the largest cost head for manufacturers. In addition to raw material costs, sizable investments are made in marketing channels for product promotions”

The major cost component for a manufacturer is the cost of raw materials. Since several small and medium-scale players invest very little in automation, the cost of labor and personnel is quite high. In fact, raw material cost (~50%) and labor costs (~17%) are two of the largest cost heads. The vitamins and dietary supplements market procurement intelligence report provides a detailed analysis of the cost structure of the service along with the prevalent pricing models that prominent suppliers opt for.

In addition to the cost of manufacturing the product, product marketing cost is also high. Since there are several companies offering essentially similar types of products, the suppliers need to maintain a top-of-the-mind recall for their products. As such, significant investment is done in the marketing and branding of the products.

Flat fee pricing is the most prevalent pricing model followed in the industry. Flat fee pricing leaves the minimum scope for price negotiations. One of the major reasons for this pricing scheme is the prevalence of CDMO manufacturing in this market. Apart from the flat fee, value-based pricing is also followed in certain instances.

Sourcing Intelligence

“While North America is the largest market for vitamins and dietary supplements, Asian countries like China and Singapore are the least cost countries for manufacturing.”

While North America has the largest consumer base for vitamins and dietary supplements, Asian counties like China, Singapore, and India are still the most cost-effective countries for manufacturing. Most of the manufacturing in these countries is done through contract manufacturers. However, the imports of multivitamins have increased recently and have overtaken the export quantity in China.

Since the number of players in the market is high, the larger players prefer a full-service outsourcing engagement model and prefer to have their products manufactured through contract manufacturers. This omits the requirement for having a global manufacturing presence. Thereare also instances of white label manufacturing in the industry. With the instances of contract manufacturing and white labeling prevalant in the industry, the approved provider model of operating model becomes the common operating model for the largest players.

Presently, there are several products in the market with little to no product differentiation. It is also significantly fragmented. However, this generic nature of the industry is expected to change in the future with more regulations around product and quality and mergers and acquisitions.