Nutri Natural, Herbal and Vitamin Supplements on the United Kingdom Market - Case Study Example

English Nutri Natural, Herbal and Vitamin Supplements Introduction In the UK business industry, the vitamin and supplement industry has become attractive for many investors as they seek to take advantage of the growing demand. Research analysts suggest that the market is expected to reach a value of about $786 million by the end of 2018. Market growth seems to a result of the increase in demand for food supplements as the public become more aware of the need for healthier feeding habits. On the other hand, the health regulators seem to be constraining the market as they take a restrictive approach to ensure that food supplements released in the market are healthy and that organizations are able to deliver to the standards they promise. In addition, many organizations are watching the growth of this demand and competition is already building. Therefore, market positioning and efficiency in marketing company products has become more relevant. For a company such as Nutri that intends to launch their online retail sale of natural, herbal and food vitamins, it is crucial to understand the market dynamics, distribution and the nature of competition within the market to be successful. Notably, the UK food supplements market is complex, and brand positioning is a necessary effort. Market Analysis In the past ten years, it is evident that the demand for supplements and vitamins has grown considerably and is already at a plateau phase. Approximately, the Food and Supplements market will reach $786 million within the next five years. Therefore, there is an opportunity for investment in this industry. UK enjoys stable economic growth and the low rates of unemployment in the country points out that the public have a well-grounded purchasing power (Ritchie 2-7). If this continues in the near future, it is obvious that the food supplements market will grow in tandem with the public demand. To this end, the economic perspective of the US food supplements market favors Nutri’s intention to launch their food supplements market. The social-cultural factors appear to be the main drivers of the demand for food supplements in the UK market. The high rates of obesity and health-related diseases have triggered a sudden change in the diet behavior in the UK. UK is among some of the countries have high rates of health-related diseases in the world due to high consumption of energy-rich foods. This trend has seen many health organizations as well as the government launch public awareness programs in the world to warn the public against unhealthy feeding habits. Consequently, the public is becoming aware of the need to focus on healthy feeding patterns and the need to supplement energy reach foods with vitamins. Resultantly, the public have shifted their focus to intake of food vitamins to supplement their eating behavior (Ritchie 2-7). This explains why the demand for these commodities is increasing in the UK market. On the other hand, the regulation of the vitamins and supplements in the UK industry is an important factor for a new market entrant. The European Food Safety Authority (EFSA) is a major regulator in the industry and seeks to ensure that companies provide quality foodstuffs that do not jeopardize the life of the people. Over its history, the company has received over 40 thousand requests for food supplements and food products but has only accepted 248 requests (Tabet, Rummana, and Helen 267-271). EFSA has criticized manufacturers for providing false information on the value of their products and misleading the public with their claims. As result, the organization is creating public awareness against the consumption of food supplements without approval of their medical professionals. Some medical professions have warned that some food supplements have no value while others pose dangers to their consumers. Additionally, there is a campaign against over reliance on food supplements and the need for consumers to eat natural products. As a result, the consumers are exercising extreme caution while choosing their suppliers. They prefer to purchase from certified suppliers who provide transparent information and deliver quality commodities. Resultantly, the market is under threat by a wide range of political and legal factors. Just like any other industry, the food supplements industry has experienced a paradigm shift in the era of technology. Technology has become a platform for organization to appeal to a greater customer population. The organizations can use internet and mobile services to roll out their products within the market. Currently, over 44 million UK adults connect to the internet either through mobile phones or even a computer. The growth of internet population enables organizations to use this platform to market their products. Apart from this, the online retail is growing considerably. Companies can use web platforms to sell their products by providing interfaces through which consumers can pay for their products and have them delivered. The Food Supplements online retail market has both an advantage and disadvantage. While this is an avenue to increase sales, it is a threat to business survival as the consumers become aware of organizations who use this avenue to sell substandard products (Virtsonis and Sally 556). Therefore, Nutri has a challenge to convince the population to purchase their quality products within the online market by providing transparent information and striving to provide the quality products, which the public demands. Channel for Distribution In the UK, Vitamins and Food nutrients suppliers have used a wide range of market channels to ensure that their products reach the consumer. While any approach may be suitable for targeting the consumers, it is clear each approach has its own up and downs as far as the volume of sales is concerned. One popular approach that manufacturers have used is stocking their products in drugs stores and chemists. Currently, majority of organizations have used this approach due to take advantage of the public conception of supplements as medicinal products. Since these vitamins and supplements are packaged as pills, they are easy to sell to customers who have nutritional deficiencies (Virtsonis and Sally 559). While this approach has gained popularity, it gives the impression that supplements are pills that should be taken during illness. Therefore, manufacturers have opted to shift their stock to supermarkets to ensure that customers can access these products outside the market and use them regularly. Direct selling of nutritional additives is gaining momentum in the current market conditions due to changes in consumer attitudes. Direct selling provides manufacturers with the opportunity to market their products with the consumers and to provide valuable information that is important in pursuing buyers. At a time when consumers require transparent information about products, direct contact between manufacturers and consumers is crucial. For the last five years, manufacturers are using this approach to support their marketing strategies and to understand the customer behavior. Therefore, the approach is allowing producers to gain trust from the customers by providing them with reliable products that suit the demand (Virtsonis and Sally 556). However, opening direct sale stores is an expensive investment for organizations. Resultantly, organizations that use this channel are unable to produce favorable prices as compared to those who make indirect sales. Lastly, the online retail market channel is becoming a supportive approach for many organizations in the current century. As the public becomes more network-aware, online strategy is the way to go for organizations. Online retail has wide range of advantages for organizations. First, online retail allows customers to pay for their products online and have the delivered. This method is crucial as it makes it possible for organizations to reach out for more customers without necessarily opening expensive stores. At a time online purchasing is gaining popularity, it is likely that most consumers do not want to leave the house to buy supplements. Therefore, availing such products online will considerably lead to an increase in sales. Secondly, an online strategy is an efficient marketing tool that allows organizations to create product awareness and to garner public reactions. Therefore, it is an opportunity for Nutri to appeal to more customers and use customer feedback to satisfy the growing demand for organizations. However, the online approach has a number of disadvantages including threat by online hackers. At the height of cybercrime in the UK, online purchasing is risky and consumer safety is expensive to maintain. Therefore, Nutri has to be ready to invest in securing the networks to ensure customer safety. Secondly, the notion that manufacturer provide false information within their online sites, is a threat to online retail industry (Sean Para. 4). Therefore, Nutri should exercise extra precaution while launching as online retail as a distribution channel for their products. Product Analysis While the UK market promises high demand for dietary supplements, it is clear that quality of the products is becoming an important issue for them. A wide range of product categories is available within the UK market. Manufacturers have categorized food supplements as vitamins, dietary minerals, herbal medicine, body builders and essential amino acids. While some of these have benefits medicinal values, it is clear that some contain only additional nutrients that they presume to have value on the body (Sean Para. 5). On the other hand, consumers are becoming more conscious of the nature of products, it real value and even its side effects. Therefore, organizations have a challenge to focus on products that add value to the health of the consumers. For Nutri, it is crucial to consider the attitude of consumers towards herbal products within the UK market. While there is evidence that UK population is going natural and preferring herbal products, the use of herbal supplements has become controversial. The UK Medicine and Regulatory Agency (MHRA) warned the manufacturers of botanical food supplements against harmful products citing concerns of health risk in consumption of these products (Grace 13-22). Therefore, the product safety has become a major concern for any organization that intends to survive within the market. From this perspective, fulfilling the legal requirements of the herbal supplements would be a milestone for Nutri in taking advantage of the rising demand for herbal dietary supplements. Competitor Analysis Market competition has become inevitable in any business industry in the modern business environment. In the Dietary supplements industry, market competition set in as soon as the demand for these products boomed. The major competitors in the industry include popular companies such as Bayer, Seven Seas, Bayenica and Boots. Seven Seas is a company that specializes in the production of all food supplements within the market. Seven Seas is important factor in the market due to the popularity it enjoys within the UK market (Sean Paras. 2-3). Bayer and Boots have also come out strongly to compete in the marketing by using price models and effective marketing strategy to enlarge its market share. Besides, there are new markets entrants in the industry and the number of manufacturers are increasing each day. On this note, Nutri has to prepare for competition as they enter into the market. In view of competition, the balance between quality and price becomes crucial for organizations. From a critical angle, price competition has become more crucial for competitors within the food markets industry. While the UK consumers are economically stable, there is evidence that price influences their purchasing pattern largely in the UK business sector (Jones 1-7. When the number of manufacturers increase, the consumers bargaining power increases as they a have a chance to select from different suppliers. On the other hand, suppliers lose their bargaining power and they have to offer low price, quality products to win customer loyalty. Bearing this, Nutri has a challenge to focus on cost reduction strategies if they have to survive in their business strategy within the competitive market. Launching an online retail market may be an efficient way to reduce the advertising cost and to ensure that the organization appeals to more customers. Conclusion In conclusion, the UK Food Supplements industry is experiencing an exponential growth due to the influence of social and economic factors. As customers focus on healthy eating habits and have the power to purchase food supplements, it is obvious that this market will grow. In an era of technology, Food supplement manufacturers have a wide range of distribution channels that they can utilize in rolling out their products into the customer niches. However, there are many factors constraining the Food supplements industry and threatening the long-term survival of organizations. The increase in regulations and ethical awareness against the dangers of food supplements has affected the consumer behavior and pattern. Additionally, competition has led to product price-reduction, as the price remains the major determinant of consumers purchasing pattern. Works Cited Grace, C. "A Review Of One-To-One Dietetic Obesity Management In Adults." Journal Of Human Nutrition & Dietetics 24.1 (2011): 13-22. Academic Search Premier. Web. 2 Dec. 2014. Jones, Nicholas R. V., et al. "The Growing Price Gap Between More And Less Healthy Foods: Analysis Of A Novel Longitudinal UK Dataset." Plos ONE 9.10 (2014): 1-7. Academic Search Premier. Web. 2 Dec. 2014. Ritchie, M.R. "Use Of Herbal Supplements And Nutritional Supplements In The UK: What Do We Know About Their Pattern Of Usage." Proceedings Of The Nutrition Society (2007): AGRIS. Web. 2 Dec. 2014. Sean, Poulter. The Great Health Supplements Con: How Firms Like Seven Seas and Vitabiotics Exaggerate benefits of by Millions. 2014. 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