E-commerce channel has become a new growth engine for the nutrition and health food industry. China's health food industry grows by 10%-15% annually. E-commerce channels, especially cross-border e-commerce, is expected to maintain a compound growth rate of more than 50%.

In the past, health food used to be an important profitable category for retail drugstores. Due to various factors, the sales growth of drugstore terminals is gradually slowed. The continuous and high-pressure regulatory actions against the marketing channels as well as the recent "100-day action" - the highest standard handling and crackdown of illegal direct selling - will further reduce the market share of offline health food.

On the contrary, with the rise of the young generation, e-commerce has become an important platform for young people’s health “fashion”. Many favorable policies, including the first E-commerce Law, have promoted the healthy development of e-commerce and cross-border e-commerce industry.

Take the Taobao’s health food/dietary nutrition supplement sales index in Jan 2019 for example, a group of foreign brands entered through cross-border e-commerce have occupied half of the TOP10 monthly hot brands.

Taobao’s health food/dietary supplement

TOP10 monthly hot selling brands,Jan 2019

By-health, which ranked the first in the e-commerce brand list, previously released the performance preview which showed that the company consolidated the key SKU strategy and implemented the e-commerce brand 2.0 strategy, etc., which started a new round of growth cycle. It is expected that the company's annual revenue will increase by 20%-40% in 2018, with a net profit of 0.9-1.1 billion yuan. Another company, Xiwang food, which has acquired Muscletech, will focus on its two main businesses in 2018. Xiwang food expects its profit to increase by 30-35% year-on-year, reaching 440-460 million yuan.