Out of stock.” These three words are shoppers’ least favorite words to see when purchasing their go-to products, especially when it’s an item that supports their everyday healthcare routine. This issue can come down to several factors, a critical one being the ability of raw materials suppliers to keep up with market demand seen by finished product manufacturers and retailers. We can all attest to the significant supply chain issues that the pandemic caused, some of which are still wreaking havoc. For instance, problems with shipping increased container prices, material shortages and overall rising costs are still very relevant for many of today’s manufacturers, and combining these while also trying to meet the heightened consumer demand can create quite an imbalance. Look no further than NutraIngredients USA's 2023 annual ‘State of the Industry’ report to back up this assertion.  It found that shipping costs and delays still accounted for key disruptions for 80% of the respondents (1).

While the natural products supply chain remains volatile, these disruptions aren’t stopping consumers from wanting their dietary supplements. According to the 2023 Council for Responsible Nutrition’s (CRN) Consumer Survey on Dietary Supplements, 74% of Americans take dietary supplements, with 55% reporting they are regular users (2). In another report, the CRN found that the dietary supplement industry provided $158 billion to the U.S. economy, up 23% from 2016 (3).

These statistics support that the demand is there, but the question remains: What innovative solutions are raw materials suppliers and finished product manufacturers implementing to keep up? 

Interestingly enough, the NutraIngredients USA survey went on to reveal that 12% of finished product manufacturers said they added a second qualified supplier, 9% had to find a new provider of their raw material, and in some cases (5%) discounted the SKU(s) or reformulated the product entirely. It also reported that 36% adopted a combination of these approaches, and 18% said they had to implement all four (1). 

As brands become more savvy with their supply chain strategy, how can raw material suppliers better support their brand manufacturers and retailers and meet consumers’ demands and expectations, all while improving and preparing for unexpected challenges? One way is to diversify. 

Supply Diversity, Sustainability, and Transparency

Diversifying the supply chain offers adaptability to the ever-evolving landscape of global commerce and helps prepare for unexpected world issues. It positively impacts inventory and, over time, can improve cost management.

People want quality, value, and trust in their products, and to increase that brand loyalty (or emotional connection), consumers want to know about the environmental and ethical standards the company promotes.

1. https://www.nutraingredients-usa.com/Article/2023/03/15/state-of-the-us-dietary-supplements-sector-in-2023 
2. https://www.wholefoodsmagazine.com/articles/16497-74-of-americans-take-dietary-supplements-crn-consumer-survey-finds
3. https://www.crnusa.org/newsroom/crn-report-dietary-supplement-companies-pump-158-billion-us-economy-23-2016 
4. https://www.reportsanddata.com/report-detail/lutein-market