Health Food Retailing - UK - April 2008

Abstract

There is little doubt that health food and VMS (Vitamins, Minerals and Supplements) are mainstream products, widely available in supermarkets and chemists. Distribution via websites and home shopping is also broadening. So, in this competitive climate Health Food Retailhealth food retail specialists have begun to carve out specialised niches. Holland & Barrett has specialised in VMS, others have diversified into massage, bodycare, herbal preparations or Chinese medicines.

New legislation that requires supplements to be licensed (in a similar way to pharmaceuticals) is coming into force in two years' time, and this could restrict the availability of VMS products, and it is claimed that this could damage the specialist retailers' sales.

Specialist health food retailers could start, and indeed are, licensing some products but this is an expensive process for them, whereas the large pharmaceutical companies have the expertise and funding to be able to afford to license more products. As a result more of the VMS supply could be concentrated into the hands of the big pharmaceutical suppliers.

On the other hand, tighter legislation could even boost the image of VMS as more of their health claims could be substantiated in a more scientific way, while confidence in the safety of some medicines could also be heightened.

Mintel last examined the UK market for Health Food Retailing in March 2006.

Key themes of the report:

• In view of legislation coming into force by 2010 requiring supplements to be licensed, is this a future problem or an opportunity for health food specialists? Will they simply adapt?
• VMS sees plenty of promotional offers, especially in Holland & Barrett and Boots. But is there simply too much discounting and does this undervalue the products?
• Supermarkets are embracing almost every aspect of health food retailing, so what must specialists do to survive?
• There are masses of stories in the media about diet and health and some have certainly proved important in stimulating demand for health foods. But is the health food landscape becoming too confusing for consumers?
• Is the Whole Foods store format the future of UK health food retailing?