Home Standard Operating Procedures Marketing Dept. Reference Distribution Channels Distribution Channels: Supplements Supplements: Other Retail

Supplements: Other Retail

Updated 2 yrs ago | 10 minutes

Overview

Retail stores, and other points of sale other than pharmacies, can include supermarkets, specialty retailers such as supplement shops and health food stores, convenience stores or online shops. However, such distribution depends greatly on the country and its prevalence of these types of stores that reflect sufficient demand to support more channels:

Supermarkets	Supermarkets are more prevalent in developed countries, but also are growing in developing countries. Every supermarket has a section of the store dedicated to OTC medicines and supplements, often in the same section devoted to healthcare products. Supermarkets will often have a similar range of offerings to a pharmacy, but perhaps less in terms of scope of products and brands.
Specialty Healthcare Stores	Retail stores selling only supplements and nutritional products, and health food stores, are growing channels, especially in developing countries which have increasing per capita GDP. The market share of these stores is still relatively small, but are becoming more prevalent to cater to health-conscious consumers.
Convenience Stores	The definition of a convenience store can vary depending on the country. More developed countries have chains such as 7-11, Circle K, Family Mart, etc., while developing countries have independent shops that fulfill the demand of mini-supermarkets that carry a bit of everything, mostly daily used products which can include a small selection of supplements.
Traditional Markets	Local bazaars and street markets are common retail locations, and cannot be ignored. Vendors typically sell a variety of health products such as herbal remedies and supplements.
Direct Sales and Multi-Level Marketing (MLM)	This channel plays a significant role in distributing supplements in developing markets. Independent distributors sell products directly to consumers through private networks or home-based sales parties. In developed countries, this channel is usually dominated by larger corporations such as HerbaLife, Amway, etc.
Community Health Centers	In rural and underserved areas, especially in developing countries, community health centers may stock basic supplements to address common nutritional deficiencies prevalent in the region.

Product Range: Which products apply to this channel and why?

Our entire supplement range is positioned for any retail channel, meaning we can cover all of the products that a retail store or shop would have demand for. It is important to understand which dosage forms are positioned for retail stores and who are the decision makers for the end consumer.

While pharmacies are likely to have a greater range and scope of supplement products, other retail outlets will vary as some will have a larger selection while others a smaller selection. For example, supermarkets are likely to carry a larger selection than a convenience store which is more likely to carry more basic, fast-moving products focused on specific uses such as energy, immunity or vitamins such as B, C and other common supplements that common people know and consume.

The following dosage forms in our pharmaceutical range are distributed through the retail channel:

SUPPLEMENTS IN THE RETAIL CHANNEL
TABLETS	Tablets are solid dosage forms made by compressing powdered or granulated supplement formulations and can be in various shapes and sizes, including round or oval. Tablets are swallowed or chewed and dissolve in the digestive system to release the active ingredients. Tablets are the most common form of supplements . Usually more volume of ingredients can be compacted into a tablet than a capsule, and tablets are cheaper to produce as the capsule shell is not needed. Common for all types of retail channels.
Coated/Uncoated Tablets (swallowable)	Tablets can be uncoated or coated, depending on the release rate of the ingredients.
Caplets	Caplets are tablets in which the shape resembles a capsule. Caplets are designed for easier swallowing due to the shape, and are usually coated which also aids in swallowing.
Chewable Tablets	More palatable and easier to consume, specifically for people who have difficulty swallowing. Usually preferred over swallowable tablets and more marketable.
CAPSULES	Capsules are cylindrical or oval-shaped shells made of gelatin or vegetable-based material that contain the powdered form of the supplement. Capsules are swallowed whole and dissolve in the digestive system to release the active ingredients. Capsules typically look nicer than tablets as the shell of the capsule can be chosen to match the intended use, but are usually slightly more expensive as the capsule shell cost is added to the production cost. Common for all types of retail channels.
SOFTGELS	Softgels are capsules with a gelatin or plant-based soft shell that contain a liquid or oil-based supplement formulation. Softgels are easily swallowed and typically provide better absorption of fat-soluble nutrients. Softgels are generally more expensive than tablets and capsules, but also more marketable for reasons mentioned. Common for all types of retail channels.
GUMMIES	Gummies are chewable supplement made from gelatin or plant-based pectin that have a soft and chewy texture. The color and flavor can be customized to suit the intended use of the formulation, making gummies highly marketable and popular. Gummies are especially suitable for children and people who have difficulty swallowing, or just prefer a better tasting supplement form. Especially well positioned for supermarkets, convenience stores and specialty stores as these are preferred by regular consumers who might not go to a pharmacy to buy a supplement product.
EFFERVESCENT TABLETS	Effervescent tablets are a type of tablet that is designed to rapidly dissolve in water, creating a fizzy or effervescent solution. The flavor and dissolving effect creates a sparkling, flavored drink which is preferred by people who prefer to drink instead of chew or swallow. Effervescents are a niche product, yet highly marketable given a solid form can be turned into an enjoyable liquid form. Especially well positioned for supermarkets, convenience stores and specialty stores as these are preferred by regular consumers who might not go to a pharmacy to buy a supplement product.
POWDERS	Powders are mixed with water, juice or other liquid to create a drinkable solution that can be measured and flavored. Powders are unique from other liquid forms due to the mixability with liquids other than water, for example smoothies or any liquid of choice. As these are more of a niche product, might be more suitable for pharmacies, supermarkets and specialty supplement stores, and less common in smaller shops.
SYRUPS	Syrups are a liquid form that is thick and viscous, suitable for children and people who have difficulty swallowing. Syrups are especially popular for children as most formulations are specifically for this age group. Syrups have the best taste masking of all liquid forms as the flavors are usually sweetened. Popular for children, these are still a niche product and therefore more commonly sold in pharmacies, supermarkets and specialty supplement stores rather than smaller shops.
DROPS	Oral drops are concentrated liquid in a small bottle with a dropper. Oral drops can be flavored (but are often unflavored) and mixed in water or other liquid, or administered directly under the tongue for better absorption. Oral drops are a more versatile liquid form preferred by some people who have difficulty swallowing or want various options for administration. As these are more of a niche product, might be more suitable for pharmacies, supermarkets and specialty supplement stores, and less common in smaller shops.
BY HEALTH CATEGORY
GENERAL HEALTH	Supplements for general nutrition and various health needs. The largest, most broad health category. Any supplement that does not fit into the other categories falls within General Health.
CONDITION SPECIFIC	Specialty supplements formulated to target defined health goals. Formulations with many ingredients that work together, such as for heart health, immunity, liver health, sleep support, prenatal, etc. Some formulations are generic, others are our proprietary formulations. Can be very marketable, but require more marketing as the conditions might be niche and consumers are not familiar with our brand.
VITAMINS & MINERALS	Any product that is a single vitamin mineral, or can be a combination of a few or more. Some examples include Vitamin C, Vitamin D3, Multivitamin, Calcium, Vitamin B Complex, Zinc, etc. Often more basic products that are popular and have demand, but highly competitive given so many competitors producing the same product without differentiation.
HERBAL FORMULATIONS	Herbal products are more mainstream, but a bit more niche. Some products are a single herbal or natural extract, while others are a combination of different herbal extracts. Products in the other health categories might contain an herbal extract but might not be included in this health category. Some examples include Garlic Oil, GInseng Extract, Cranberry Extract + Vitamin C + E, Flaxseed Oil, etc.

Target Audience

B2B: Primary Target Audience

As retail stores and outlets cannot purchase large volumes of supplements to meet our MOQ per product, they will purchase through domestic distributors.

See:

Distribution Channels: An Overview > Pharmacies/Retail Stores > Why don’t pharmacies buy directly from AdvaCare?

These distributors are our customers, the direct purchasers of our supplement products, and therefore our primary target audience.

See:

Distribution Channels: An Overview > Distributors

B2B: Secondary Target Audience

The retail stores and outlets that our distributors sell our supplements to, like pharmacies, are the secondary target audience - a later stage in the supply chain. The procurement manager, general manager and/or owner of the retail stores are the decision makers that decide the vendors and orders based on product prices, availability, quality and relationship with the distributor. Prices are especially important given that retailers are the point of sale. As the purchasing power of a single store or shop is comparatively small, the quantities purchased will usually be smaller unless the store has more than one location or is a chain.

It is important to know the different types of retail stores and outlets to understand this target audience and how pharmaceuticals fit into this channel.

Strong brand awareness and product promotional materials are especially important for our supplement products at retail points of sale, perhaps even more so than at pharmacies because unlike pharmacies, consumers often are not going to other retail stores specifically to purchase a supplement product as they would to a pharmacy. In such a case, our product packaging and promotional materials matter even more, as our products must sell themselves off the shelf. Therefore, it is important that we make our products and brands stand out amongst the competition. How do we accomplish this?

● As supplements are positioned on the shelf without the recommendation of a pharmacist, our product packaging must be more attractive than the competition, reflecting quality and credibility.

● In-store promotional materials that draw attention to our products, such as signage, product displays, shelf wobblers and printed materials that attract and educate consumers.

Once our product is used by a retail store, and if the product was well accepted by consumers, the consumer will again buy or request the same brand at the same store, and even consider other AdvaLife products.

B2C

Consumers are the end users of our supplement products. These people go to a retail store with or without the intention to buy a supplement off the shelf. Given that the decision to buy our product is often spontaneous and made on the spot, our branding awareness and messaging are very important. Compared to our other ranges, the consumer is most important to our supplement range as it is the consumer that always makes the buying decision.

Supply Chain

Retail stores are the second to last stage in the supply chain before the product is used by a patient or consumer:

API Manufacturer > Finished Manufacturer > AdvaCare > Distributor/Importer > [Sub-Distributor] > Pharmacy/Retail > End Consumer (patient/consumer)

See:

Distribution Channels: Introduction > Understanding Supply Chains

Promotional Materials: Which materials apply to this channel and why?

Retail stores rely on 3 methods by which to sell products:

1. Consumer walk-ins that intend to purchase a supplement product but have not predetermined the brand to purchase.

2. Consumers that go to a retail store specifically to purchase an AdvaLife product, either because they previously purchased the same or another AdvaLife product or were recommended our product.

3. Consumer walk-ins that do not intend to purchase a supplement, but make a spontaneous purchase by seeing our product or promotional materials.

The kind of promotional materials we produce for our distributors to provide to retail stores should be more retail oriented than those to pharmacies. And it is important to always keep in mind that consumers at retail stores that are not pharmacies are likely to be making a spontaneous purchase and are also likely less health-conscious.

The secondary target audience of retail stores and outlets utilizes the same promotional materials as pharmacies:

See:

Supplements: Pharmacies > Promotional Materials: Which materials apply to this channel and why?

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