VMS Sales Still in Slump

April 1, 2001

2 Min Read
VMS Sales Still in Slump

VMS Sales Still in Slump

NEW YORK--The slowing stock market continues to bear down on the natural products industry, as data released by IRI showed February to be the eleventh straight month of negative year-over-year growth in the food, drug and mass channel for VMS (vitamin, mineral supplement) products. This followed the release of a fiscal 2000 report showing dietary supplement sales in mainstream stores were down for herbal supplements and vitamins, but up for multi-vitamins and minerals. IRI compiled data for vitamins, minerals and supplements through sales via supermarkets, drug stores and mass merchandisers. The report excluded sports nutrition and diet products.

Taking into consideration all categories, the entire supplement industry was down 3.0 percent. Total sales of herbal supplements were down 15.8 percent and sales for vitamins were down 4.3 percent, whereas sales for multi-vitamins and minerals were up 2.3 and 1.3 percent, respectively. Those supplements experiencing some of the biggest sales deficits included cat's claw (-50.6 percent), eyebright (-55.9 percent) and yucca (-59.3 percent). The most impressive supplement sales gains included guarana, (40.9 percent), green tea (42.4 percent), valerian (78.9 percent), and soy (90.2 percent). In vitamin sales, the only sales increase was for vitamin K, which experienced a 16.1 percent increase over 1999 sales to bring total dollar sales to $10,554. The largest sales deficit over last year was had by vitamin C, with a decrease of -19.2 percent and 2000 sales of approximately $190 million.

Not all supplements were on the downtrend. In the realm of multivitamins, children's vitamins experienced a 7.5-percent increase in sales, while adult multivitamins had a 1.8-percent increase in sales. In terms of brand-name multivitamins, geriatric-minded Centrum Silver multivitamin sales went up 13.2 percent to approximately $120 million for 2000. However, this affected the sales of one of its main competitors, Geritol Complete, which raked in -9.4 percent less compared to the year prior.

Contributing factors to the sales slow-down, according to SSB, include lack of new products, negative media coverage and shrinking shelf space. While SSB said it expects there to be a major pick up in industry sales by the end of 2001, it recommended that investors wait another two quarters before entering (or increasing investments) in the nutritional supplement market. For more details, visit www.salomonsmithbarney.com

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