Recently, a number of chain drugstore enterprises announced their 2018 results, including two nutrition and health food-related businesses.
Performance of major chain drugstore listed enterprises in 2018
Net profit increase
(Note: Yifeng pharmacy's performance was three quarters of 2018; Remin Tongtai’s retail business accounted
Although the overall retail growth of nutrition and health foods in drugstore terminals is increasingly weak, but it is undeniable that drugstore channels are still one of the main sales channels for nutritious health foods. For example, the industry leading company BY-Health, domestic offline channels (including pharmacies, Supermarket, maternal and child stores) increased by more than 35% year-on-year in 2018, accounting for about 80% of its domestic income.
As we all know, from the end of 2018 to the beginning of 2019, under the powerful public opinion offensive and the government's "100-day action" high-pressure attack, the illegal propaganda phenomenon in the health products field has come to an abrupt end, and then the consumption perception, competition pattern and market composition of the industry will changes dramatically.
From the perspective of consumer groups, the offline channels such as drugstores are tend to middle-aged and elderly people, while functional health food is more popular.
As a very successful functional product in the field, BY-Health’s “Jianliduo” annual revenue reached 809 million yuan in 2018, up 128.80% year on year, contributing 18.6% of the company's performance. And Jianliduo is also launched the first "big single product" by BY-Health. In 2019, the company will launch three products at the same time. It plans to achieve continuous growth of all categories under the background of leading large single products, and open up new space for offline growth.
Another successful breakout of the “big single product” is the CSPC Innovation’s Guoweikang Vitamins product, which sold through the drugstores channel, with 2018 revenue of 440 million yuan, up 33.18 percent year-on-year, contributing 37 percent of the company's revenue. Through the unique positioning of the business value of “pharmaceutical companion”, Goweikang has locked the faster and better consumption value of curing diseases. It is estimated that the market size can exceed 850 million yuan, and the overall progress of VC category in the pharmaceutical retail industry can reach 3 billion yuan.
The market has developed in two directions. One is fast digestion, that is, products are closer to food and FMCG, while the other is specialization for nutrition and health food sold through drugstores.
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- China Resources Pharm’s new gastrointestinal product “Jiangzhong Lihuo Probiotics” was officially launched
- New food ingredients were accepted in the first quarter 2020: Tongkat Ali extract & Xanthoceras sorbifolia oil