Lockdown ‘supermarket effect’ hits Swisse

vitamins pharmacy products

Vitamin sales moving to supermarkets, echoing the experience of competitor Blackmores

There has been a shift of more people buying vitamins from supermarkets than pharmacies over the past 12 months, according to Swisse Wellness Australia New Zealand managing director Nick Mann.

And despite there being an increase on online sales during lockdowns, the e-commerce sales only accounted for around 10 per cent of total sales, he was quoted in the Australian Financial Review.

This did not make up for the tougher trading conditions overall in July and August, he said.

The data had also revealed a shift to more people buying vitamins from the supermarket than pharmacies over the past 12 months, Mr Mann said.

His comments came after Swisse’s parent company Hong Kong-listed Health & Happiness (H&H – formerly Biostime International) delivered its first half of 2021 results to 30 June which showed its vitamins business in Australia/New Zealand had grown by just 0.7 per cent with its Australian e-commerce channels delivering revenue growth of 55 per cent year-on year.

The report did not say how sales had declined in July and August.

Mr Mann’s observations echoed those expressed earlier by Alastair Symington, CEO of vitamin market arch-rival Blackmores, after its annual report showed its vitamin and dietary supplement category fell $200 million in retail sales on an annual basis, with a 14% decline in its Australia/New Zealand revenue.

The past 12 months of restrictions and lockdowns in Australia “have led to a consumer shift, with foot traffic moving from pharmacy to grocery, and from traditional retail to online,” Mr Symington said.

In the Swisse report, Mr Mann said there had been been strong growth through the company’s own website and through major online outlets like Amazon as well via the e-commerce channels of its traditional retail partners.

While there was a switch to online vitamin sales when large cities go into lockdown it wasn’t “huge as our primary retail channels such as Chemist Warehouse, Woolworth and Coles remained open”, he said.

The H&H report said the Australia and New Zealand market continued to expand channels and launch a variety of new products.

Swisse is vigorously developing offline retail and pharmacy channels in Australia and New Zealand,” it said. “Swisse Nutra+, the first nutritional product series dedicated to pharmacy channels, is now available in more than 1,000 pharmacies”.

The report said its ANZ BNC business unit, which covers infant formula milk powder brand Biostime and immunity-related products, achieved double-digit growth of 29.8 per cent. 

In order to further accurately meet the needs of the Australian and New Zealand local market, the Group took the lead in launching infant foods containing HMO (breast milk oligosaccharides) in the Australian market,” it said.

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