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Probiotics powerhouse: China sales outstripping global average as DuPont reveals 50% surge

By Gary Scattergood+

28-Jun-2017
Last updated on 28-Jun-2017 at 03:55 GMT2017-06-28T03:55:21Z

DuPont's Susan Jin says probiotics sales are rapidly growing in China.
DuPont's Susan Jin says probiotics sales are rapidly growing in China.

DuPont says its probiotics business in China is booming, with sustained growth leading it to double capacity at its specialist Beijing production and packaging site this year.

Speaking to us at the recent HI China show in Shanghai, the company’s APAC probiotic leader Susan Jin said DuPont’s probiotic sales had increased by 50% over the last three years.

“In China, probiotics is booming,” she said. “Apart from our sales, we know that probiotics growth in China has surpassed the global average of 8% globally to stand at around 20%.”

“We expect another year of double digit growth for the business in 2017, and we will double the capacity of our facility in Beijing to support the growth we have in China.”

In 2011, DuPont purchased a food processing plant north of Beijing and converted it into a probiotic blending and packaging site.

The new facility allows customers to source ready-to-market probiotic formulations — something Jin told us had helped fuel its growth in the region.

Concept to communications

“We have had a lot of success with our ready-to-market probiotic drink powders,” she said. “These turnkey solutions are very popular for our consumers in China because we take care of everything from concept to communications. This means the customer then only has to consider the channel, packaging design and their marketing.”

She estimates DuPont now has 60 to 70 such clients in China, with one racking up projected sales of RMB200m this year by selling via the popular social media platform WeChat.

“The new people in the market like this make decisions very quickly and therefore, we need to have the same speed as well,” Jin added.

“This market is very dynamic and opportunities come fast and move fast. We need to make everything ready, even to the point of creating the story for our customer to tell. It has meant a lot of change for us as an ingredient company. In the past, we just sold an ingredient, now we need to do everything from beginning to end. It requires a lot of cross-departmental collaboration across marketing, operations, logistics and research & development.”

Alongside this, the company’s business to direct selling and major manufacturers has also grown, meaning it has to adapt its strategy and services depending on the client.

Adaptable approach

“I would say around 20% of our probiotic business is with pharma or OTC companies, 30 to 40% is with health foods or what we call blue hat products, 20% is in the general foods space and another 20% is in infant nutrition,” she said. “This means the services we provide can vary greatly, depending on the customer and we have become very flexible and adaptable in recent years.”

Jin identified a number of opportunities for sustained probiotics growth, including drops and powders for infants, and by combining them with other health ingredients, such as herbs or fruit powders to create “sophisticated combinations where one plus one equals more than two”.

“We also need to look more at formulations and delivery systems,” she added. “Probiotic yoghurt is no longer a point of differentiation — you need to do something new, even though that is still the biggest segment. There is now more attention being paid to juices and fermented vegetables, but these can pose some challenges and this is only really beginning to develop.”

Probiota Asia 2017  

The Probiota series is growing, and in October 2017, Singapore will host the first ever Probiota Asia event. Building on the success of the annual global Probiota and Probiota Americas events, Probiota Asia will focus exclusively on this high growth market and the challenges it faces.

Save the date: 11-13 October 2017