When it comes to health and fitness, the UK is a nation of extremes. Whereas the latest official health surveys report that two thirds of adults are either overweight or obese, the 2019 State of the UK Fitness Industry Report reveals that total UK gym membership now exceeds 10 million, with one in every seven people a member of a gym. Rodney Steel, Chief Executive, BCMPA, reports
The means to stay healthy are not restricted to physical activity. Those of us of a certain age may remember when a “health supplement” was a dose of cod liver oil; today, however, nutraceuticals — a term first coined in 1989 by the Foundation for Innovation in Medicine — is a multibillion and ever-growing global market, projected to deliver growth at a CAGR of 11.95% between 2018 and 2023 and be worth US$319.6 billion by that year.
The choice of nutraceutical products is certainly extensive, covering all types of medicinally or nutritionally functional foods — from everyday products including bio-enhanced yoghurts and fortified breakfast cereals to vitamins, supplements and herbal remedies, as well as niche and specialist products such as pre- and probiotics and collagen shots.
In addition to the many different products, they come in a variety of formats, including tablets, capsules, liquids and powders; within these categories, there can be a number of variations, such as chewable or effervescent tablets, and softgel, hard gel and plant-based vegetarian capsules.
As with most growing markets, the pace of change, both in the quest for the “next big thing” and to respond to shifting consumer demands, is extremely fast. British Contract Manufacturers and Packers Association (BCMPA) members working in the nutraceuticals sector have reported several significant developments in recent years.
“We have seen a notable rise in the area of personalised nutrition,” cites Terry Young, Director at Chrysalis Health and Beauty as one example. “People’s dietary and nutritional needs vary from individual to individual and there is increasing demand for products that can meet their particular requirements.”
Linked to this is an ongoing trend towards single serve pack formats. “As well as being the ideal size for a tailored dose, these also meet the demand for consumer convenience, something that can be popped into a gym bag or consumed on the go in keeping with today’s busy lifestyles,” says Terry.
David Rimmer, Managing Director of Unette, agrees. In the early 2000s, the company developed its Tear Top Tube for the newly developed sports gel products. From there, the company identified nutraceuticals as another range of products that would be perfect for this new packaging format.
“We first showed our single dose tubes at Vitafoods in 2016,” explains David. “At this point, single dose pretty much consisted of tablets and capsules. When I showed how we could produce a single dose in liquid form that consumers could take without a spoon or a glass of water, the response was amazing.”
“It didn’t take brand holders long to figure out that by improving the convenience of use, consumers were more likely to take their product at the correct frequency, which would in turn deliver the expected benefits and hence the repeat purchase. Furthermore, the group of consumers that don’t like to, or are unable to, take pills and capsules presented a new marketing opportunity. Health practioners concur that liquid formats ensure a better success for patients who take supplements,” adds David.
Rodney Steel, Chief Executive, BCMPA
Demand for natural and sustainable products
Another recent driver in new product development has been a growing focus on more natural products and those produced from sustainable resources. Nick Henson of Eurofins Food Integrity and Innovation says that as well as what the company describes as “conventional” nutrition products, focusing on areas such as sugar reduction and protein enhancement, Eurofins has also been involved in the development of what it terms “Fortification for Well-Being” products that incorporate botanicals and plant extracts.
“Within this sector, demand from clients for clean label has been a key growth area,” he says. “Likewise, the evaluation of plant-based materials across product categories is now one of our largest areas of project support.”
As shopping habits change across all markets, e-commerce has been another key growth area for the nutraceutical industry. Again, the move towards single-serve products is helping this, with packs designed to fit inside a box that will then fit through a letterbox.
This has also opened up opportunities for subscription products, such as the regular delivery of monthly supplies of a particular vitamin. The array of products available also reflects the wide-ranging target market that they are aimed at.
Health and fitness is no longer the prerequisite of the young; today, the market extends to busy middle-aged professionals looking to support their gym habits or replace them when time pressures begin to bite, and — an increasingly important sector — health-conscious and wealthy retirees, seeking ways to extend their good health well into later life.
Clearly, the nutraceuticals market remains full of opportunities and this is why the contract manufacturing and packing industry continues to play a critical role in its rapid development. Most importantly, outsourcing can offer cost-effective production and packing capabilities without the need for huge capital investment, along with the agility needed to respond to a rapidly changing marketplace.
As Mark Nicolson of Blends says: “Outsourcing helps businesses to navigate through the complexities of getting a new product to market.”
The range of services that companies in the outsourcing sector can offer is extensive. This is aptly demonstrated by the profiles of members on the BCMPA website, which, through its search facilty and enquiry form, can help to match nutraceutical companies with the right outsourcing partner.
For example, a herbal or nutritional expert may be familiar with the properties of various ingredients but how will they all hold together as a finished product? A contract manufacturer with specialism in formulations and blending can help with the initial creation and testing to ensure new formulae can be effectively produced at the required scale.
Similarly, a contract packer will be able to advise on suitable packaging that takes into account factors such as shelf-life, ease of opening and specific e-commerce or retail requirements, particularly in terms of sustainable solutions that have become an increasingly important factor.
Many members also offer a complete service, with the ability to take a product from initial concept through formulation, manufacturing, packing and fulfilment. “The contract sector is highly flexible in its offerings,” confirms Darren Lister, Commercial Director, Melrob Nutrition. “It has the ability to support everything from small R&D projects through to large-scale automation in manufacturing.”
Outsourcing is often viewed as being ideal for start-up businesses, helping in all the crucial areas that will get a product to launch. However, with such a focus on the need for continual innovation and new product development, feedback from the BCMPA membership underlines how this support is also vital to established larger businesses.
“Part of our client base has been with funded start-ups and entrepreneurs,” says Nick Henson. “However, larger companies are now more open to outsource support for their product development process, particularly to help accelerate product launches. This is manifesting itself in spinouts and accelerator groups being set up within these larger organisations, who then utilise an outsourced resource.”
David Rimmer believes that innovation will be critical to ongoing success in the sector, particularly as more niche products can command a higher price. “For those businesses that focus on price, the future will be very difficult as scale is needed to become the lowest cost producer, so those that do not have this will struggle. However, for those brand holders who continue to innovate, can provide a real point of difference and can respond quickly to new market trends, the future is very bright indeed.”
For that reason, for any company or individual with a bright idea, the contract sector might offer the ideal path to market. As Terry Young concludes: “Contracting offers scalability and takes the manufacturing headache away … so that they can concentrate on brand growth.”