“Tremendous resilience” in supply chain boosts supplement sector amid COVID-19, says Ayanda exec

11 May 2020 --- Experts of the finance world warn of an imminent recession due to the COVID-19-induced market shut down. In the food and beverage arena, the hospitality industry seems to be the one most affected, having been closed for over a month now across many countries. However, one potential winner – if there can be one amid a global crisis – is the supplements space, which is seeing products flying off the shelves, with a pronounced focus on immunity and prevention. Dominique Baum, Managing Director of Ayanda, the European arm of Sirio and ingredients supplier for the nutraceutical industry, speaks to NutritionInsight about the pandemic’s impact on the supply chain, rising ingredient trends and building customer trust. 

NutritionInsight: How is COVID-19 impacting the supplements industry?
Baum: Supply chains are under pressure, but on the whole, certainly speaking for ourselves, we have seen tremendous resilience in the continuity of supply. Obviously having four global locations has given the company the advantage to react – and our customers reassurance that even in the most extreme situations, there are back-ups. However, it’s also changing the way we work with customers, at least in the short-term, and shows the importance of relationship building with partners. Even if we can currently meet our customers only “digitally,” demand for many products is up.

NutritionInsight: Do you see any supply chain disruptions and how can those be avoided?
Baum: There may be challenges without proper planning, but have we seen any? Not really. Security of supply is an essential issue for nutraceutical companies, and the obvious answer is planning ahead. One aspect is to maintain good levels of inventory, but the other is to properly vet your suppliers and make sure you are in regular contact with them. For us sourcing high-quality ingredients has become part of our company DNA. Ayanda was well prepared for such an extreme event, as we carefully monitor qualitative raw material availability in the market. In fact, we took precautionary measures as early as February and further bolstered our inventory and, as such, we are in a very robust position despite the pandemic. All our suppliers for example need to adhere to our Code of Conduct and we continuously monitor reliability. To this end Ayanda has qualified 2,800 ingredients, meaning that these ingredients are validated and tested by the company. 

One aspect is to maintain good levels of inventory, but the other is to properly vet your suppliers and make sure you are in regular contact with them, Baum saysNutritionInsight: What do you think could be the long-term impact of the pandemic’s outbreak on the industry? Will it instigate the rise of new trends?
Baum: It’s obviously very hard to say and a lot has changed. In Europe, many multivitamin products are no longer available – they were sold out in roughly a third of retail stores in some countries. There has certainly been a rise in demand for immune-boosting formulations and there might be a lasting trend for these products into the future. We expect people to be more aware of the importance of their health including their immunity status. Simple vitamin supplementation may be substituted for more holistic supplement formulations going forward.
However, the crisis has strengthened our relationships with customers, and I am hopeful for another lasting outcome, more collaborative working. For example, we have established a review process to determine which food supplement specialty could be suitable for a specific customer. The nice thing about this process is that we run it jointly with our customers so the outcome is relevant and actionable.

NutritionInsight: Are you seeing a growth in immunity supplements?
Baum: I definitely am. In the past couple of years, there has been a sizable increase across immunity supplements, and we are even seeing new dosage forms as well – particularly for products like multivitamins. Increasingly, consumers want health benefits that are well documented and safe, that do not compromise on quality, as well as delivered in a more enjoyable form. In light of this, we recently developed a vegetarian gummy that contains vitamins A, B, C, D and E vitamins, as well as essential minerals.
Another type of immunity formulation we’ve seen a big growth in is probiotics. We created a softgel featuring high counts of viable bacteria in part thanks to strong customer demand. This probiotic softgel was the first to contain omega 3 and be available in the market. Having proven its viability and commercial appeal with customers, we are now seeing a rapidly increasing level of interest. The same is true for probiotic gummies, recently launched by Sirio [Ayanda’s parent company]. They contain natural flavors, uniting probiotic supplementation and sensory delight. 

NutritionInsight: Are there any particular ingredients or vitamins that are in high demand?
Baum: This current climate has certainly led consumers to become more health focused, with many seeking to strengthen their respiratory and cardiovascular systems. Omega 3 fatty acids are also a supplement of choice as well as some antioxidants, which may protect against oxidative stress.
Vitamin D has seen strong demand, possibly driven by consumers’ lessened exposure to sunlight. With confinement regulations ranging from moderate to severe, many people are looking to boost their levels, and demand for nutraceuticals that contain vitamin D or other ingredients that compensate for the lack of natural daylight is growing.
Another trend we are now seeing, due to the COVID-19 pandemic, is that immunity products traditionally taken in the winter are anticipated to see sustained demand well into the summer.

NutritionInsight: Many brands are quickly trying to launch immunity products to market – how is this achieved amid pandemic related hurdles?
Baum: There is nothing new in customers wanting to launch products quickly, and we are constantly analyzing new health formulations – immunity is no exception. We have a broad knowledge, such as which combination of ingredients have positive, synergistic effects and their biological targets in the body. Therefore, we can quickly suggest to our customers evidence-based immunity formulations, which is greatly appreciated. The driver is that customers want new combinations, but at the same time products with proven health benefits that are well documented and safe. 

By Kristiana Lalou