Vietnam’s health supplement market has proliferated from 2010 to 2023, driven by rising health awareness, disposable incomes, and a growing middle class. Source of Asia covers market overviews, challenges, and investor opportunities in this sectorial note.
Market Overview
The health supplements market in Vietnam has experienced substantial growth from 2010 to 2023. This growth is driven by increased health awareness, rising disposable incomes, and a growing middle class. The market size has expanded significantly, reaching USD 335 million in 2020 from USD 305 million in 2019, reflecting a 10% growth rate. By 2022, the market was valued at around USD 600 million, with a compound annual growth rate (CAGR) of 18% expected from 2024 to 2030.
Key Growth Drivers
Increasing Health Consciousness: Vietnamese consumers are becoming more aware of health issues and are willing to invest in products that can enhance their well-being. The COVID-19 pandemic further accelerated this trend, as people sought products to boost their immune systems.
Aging Population: With more than 8 million people over the age of 65, the demand for health supplements tailored to aging-related health issues has increased.
Preference for Herbal Supplements: Over 70% of the market in 2021 consisted of herbal and traditional supplements, driven by the perception that these products are safer and have fewer side effects. Popular items include ginseng, which is valued for its immune-boosting properties.
Domestic and Foreign Market Dynamics: While local brands dominate the market with a 70% share, foreign brands, which account for 40% of the market, are trusted more by consumers and occupy the premium segment. Major players include Herbalife, Amway Vietnam Ltd, and Nu Skin Vietnam Co., Ltd.
Source: British Chamber Commerce in Vietnam, 2021
Key Players
Herbalife: is a global multi-level marketing corporation that develops and sells dietary supplements, weight management, sports nutrition, and personal-care products. Founded in 1980 and headquartered in Los Angeles, California, Herbalife operates in over 90 countries. The company is known for its meal replacement shakes, protein bars, teas, and vitamins aimed at promoting a healthy lifestyle.
Trafaco JSC: is a leading pharmaceutical company in Vietnam, established in 1972. It specializes in the production and distribution of traditional and modern medicines, health supplements, and other healthcare products. Traphaco is well-known for its commitment to quality and innovation, leveraging Vietnam’s rich heritage of traditional medicine. The company is a prominent player in the Vietnamese pharmaceutical market, with a strong presence in both urban and rural areas.
Amway Vietnam Ltd.: is a subsidiary of Amway Corporation, a global direct selling company founded in 1959 in Ada, Michigan, USA. Amway Vietnam was established in 2008 and offers a wide range of health, beauty, and home care products. The company operates on a multi-level marketing model, providing opportunities for independent business owners to sell Amway products. Key product lines include Nutrilite dietary supplements, Artistry skincare, and beauty products, and a variety of home care items.
Nu Skin Vietnam Co. Ltd.: is part of Nu Skin Enterprises, a global direct selling company founded in 1984 in Provo, Utah, USA. Nu Skin entered the Vietnamese market in 2013, offering products focused on anti-aging, skin care, personal care, and nutritional supplements. The company is renowned for its ageLOC brand, which includes innovative anti-aging treatments and wellness products. Nu Skin emphasizes its commitment to scientific research and product efficacy.
Hau Giang Pharmaceutical JSC: is one of the largest pharmaceutical companies in Vietnam, established in 1974. The company specializes in the production, marketing, and distribution of a wide range of pharmaceutical products, including prescription drugs, over-the-counter medications, and health supplements. DHG Pharma is recognized for its focus on research and development, quality manufacturing practices, and its extensive distribution network across Vietnam. The company aims to enhance public health and provide high-quality healthcare solutions.
Investment Incentives for Foreign Investors
Vietnam offers several incentives for foreign investors in the health supplement sector, outlined in Decree No. 09/2018/NĐ-CP:
Tax Incentives: Reduced corporate income tax rates and tax holidays for new investments in prioritized sectors, including health-related products.
Customs Duty Exemptions: Exemptions on import duties for goods forming fixed assets, export processing contracts, or scientific research (Articles 15, 16).
Land Rental Incentives: Exemptions for projects in prioritized sectors or difficult socio-economic areas (Article 19).
These incentives make Vietnam an attractive destination for health supplement businesses.
Source: Vietnam Briefing
Opportunities and Challenges
VAFF also exchanges information with the US, China, Japan, and the EU on legal standards and new products, ensuring Vietnam stays current with trends and quality, making it an attractive market for foreign businesses.
Local Distributors: Collaborating with a licensed and reliable local partner is crucial for success and can help navigate market complexities.
Trading Companies: Establishing a trading company requires obtaining several certificates (investment registration, business registration, and functional food license) and adhering to strict product declaration, labelling, and health and safety standards.
However, the health supplements industry in Vietnam faces significant challenges, including the proliferation of illegal products, false advertising, and regulatory shortcomings:
Illegal Products: Authorities struggle to control substandard, cheaper supplements.
False Advertising: Misleading claims on platforms like Zalo, Facebook, and YouTube deceive consumers.
Regulatory Gaps: Government regulations lag, unable to address false advertising effectively.
Source: Vietnam National Trade Repository & Vietnam Briefing
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