Put in the context of an overall boom in China’s fitness industry, where the market for fitness centres last year was valued at upwards of US$20bn, and surging at a rate 10 percentage points higher than the global average of 20%, the rise of performance supplements is running out of steam.
Typically, sports nutrition would be expected to grow in tandem with fitness, but it has actually been slowing significantly from a peak in 2012 of 19% due to a raft of imposing barriers.
“Fitness here is really exploding, but because of the government’s regulatory system, health supplements really aren’t seeing any correspondence,” says Jeff Crowther, executive director of the US-China Health Products Association, which has monitored the growth figures.
“And if you go to a typical gym, you won’t see a bunch of sports nutrition: there are no real health food stores here, with the exception of World Health Store—that’s about it. So the sales channels are very limited.”
It doesn’t help either that regulations governing the popular cross-border e-commerce trade in supplements, which has seen international products shipped to China under preferential value-added tax rates, are facing constant upheaval.
“The authorities keep changing the game-plan on a what seems to be a daily basis right now,” adds Crowther.
It seems that China’s food safety authorities must face up to the fact that their byzantine system of health product approvals is not working to the benefit of either manufacturers of an increasingly sporty and health-aware public.
Under current regulations, sports pills and capsules are regulated in a completely different way to products that are seen as foods, such as powders and gummies. This means that an item with a delivery system that classes it as a health food will require so-called Blue Hat certification, which can take some three years to clear the approvals process.
“Sports nutrition has its own standard, but it’s a no-man’s-land,” says Crowther. “It’s kind of teetering between food and health food, so what most companies are trying to do is lean towards products on the food side, which is gong to be less onerous when it comes to importing and registration.”
On June 20, Crowther’s organisation will be holding a sports nutrition summit in Shanghai to explore the regulatory environment and product approvals processes, as well as sales channels and cutting-edge ingredients.
“We are doing this to help manufacturers, especially those from overseas, understand the processes,” he says.
“We want to bring domestic and global companies together to start looking at how we can better address these issues and encourage China to move this segment of the industry forward.”
The list of attendees, which represent a whole range of blue-chip companies, including Alibaba, Arla Foods, Blackmore’s, Fonterra, Glanbia, New Nutrition and Swisse, suggests that the idea of opening up the sports supplements market is fast becoming one of the key issues in Chinese nutraceuticals.
Crowther says: “There are plenty of gyms in China—this is why sports nutrition industry and our conference in general is getting so much attention.
“On one side, fitness is booming, but on the other, the regulatory process is putting companies off from investing in any kind of broad-spectrum branding.
“But there needs to be a lot of education and a better understanding of the regulatory system, and how China wants to regulate the industry.”