Immunity boosting, preventive care, and ancient science – these are the terms that are typically associated with the nutraceutical industry and other nature-based medicine streams.
The market size of the global nutraceutical industry was around $382 billion at the end of 2019, and is expected to grow at a CAGR of ~9 percent, taking the industry to $755 billion in the next five years. Even the Indian nutraceutical industry is expected to grow from $4 billion at the end of 2019 to $25 billion in the next decade.
The nutraceutical industry presents immense possibilities not only for growth, but for innovation, experimentation, and market expansion.
It is an industry full of entrepreneurial opportunities. Let’s take a look.
Scope within the nutraceutical sector
The nutraceutical industry primarily operates in three categories — producing raw materials, manufacturing ingredients, and developing over-the-counter (OTC) products like dietary supplements.
Today, India is among the top three suppliers of medicinal herbs and plants to the world. There still exists scope for more.
Starting with manufacturing-led opportunities, one can explore areas such as – (a) enhancing crop yields through gene mutation and agriculture management to ensure the availability of quality resources required for innovation and research in various product categories; (b) importing more species of seeds, herbs, plants having medicinal utility, and cultivating them in India to facilitate R&D and reducing the import burden; (c) investing in capabilities to produce internationally accepted quality standards, creating facilities to do the stringent quality checks, and developing robust technical systems that ease the approval of Indian products globally.
In 2010, at OmniActive, we started cultivating a special variety of marigold flowers to extract medical quality lutein. Lutein is the key ingredient for eye-health supplements. What started with 1,000 acres of land has grown to 10,000 acres today. Not just that, it has increased the farmers’ income by 10x and has reduced the import requirements of the marigold flowers.
Similarly, there are many other crops like a special variety of paprika that can be cultivated here to support ingredient manufacturers like us.
Leveraging technological innovations
Opportunities are not limited to manufacturing-led solutions. The industry offers a variety of prospects that are even technology-led. Entrepreneurs can develop solutions that can help traceability, one of the critical parameters in global trade.
Starting from where and how the crops are grown to every stage it passes through can be tracked using various traceability solutions. It adds to quality assurance and thus attracts global demand. RFID Tagging, Blockchain, and Distributed Ledger Techniques (DLT) lead the way in technological solutions for traceability.
Similarly, unleashing the power of artificial intelligence (AI) across all the verticals can also bring progressive changes. AI finds its applications starting from at the farm level to predicting the need for supplementation and dosage computation for every individual.
Lastly, data analytics can be extremely helpful in R&D and clinical research. To endorse the acceptability of the Nutra products – these are essential areas to mainstream manufacturing and should be explored.
Supporting the nutrition drive of Mission Poshan 2.0
The industry offers a unique combination of amalgamating conventional science with modern technology. Multiple business prospects with promising growth potential are available to venture in by blending traditional medicine heritage, resources, and tech capabilities.
Regulators are more cognizant about nutrition at the country level. Mission Poshan 2.0 got announced during the Budget 2021.
Nutraceutical products can naturally support this drive as dietary supplements, functional food, and beverages are meant to bridge the gap between the nutritional intake through food and required nutrition for overall health.
A collective push can augment the upswing for the nutraceutical industry that is poised to see double-digit growth.
Opportunities extended to the allied sectors like logistics and edtech
Entrepreneurs can also look at allied sectors like logistics. A strong supply chain is a backbone for every industry. The nutraceutical products — whether the raw materials, ingredients, or the final OTC products demand special logistics facilities across all three delivery miles, i.e., first, middle, and last mile.
Technology-led logistics solutions like trucks with specific temperature control and other required conditions, safe and secured transit to various locations, and solutions that ensure no transit wastage, protection of quality during transportation, and swifter delivery especially of the perishable raw materials – all these offer various innovation possibilities with immense growth potential.
Last but not the least, the nutraceutical space offers prospects even in the edtech space, one of the most talked-about industries during the pandemic. The pandemic has compelled the healthcare sector to look at various delivery models giving a boost to the nature-based medicine streams.
People are preferring prevention to the treatments and home to hospitals.
Investing in creating more awareness about this subject, converting the heritage of Ayurveda and other ancient sciences to a more palatable language, and introducing formal courses to learn preventive care science systematically can generate meaningful socio-economic business returns.
Demand to learn these subjects is extremely high in the Western world and during the pre-pandemic years, medical tourism had seen this rush of students travelling to India.
Having been born in a business family, the ability to build enterprises and spotting opportunities come easy to me. However, it is heartening to see that entrepreneurship is now a welcoming career opted by young as well as middle-level professionals with no such background.
The global ecosystem is evolving, and India has enough ingredients to seize the upside of disruption in today’s transformative era. I would emphasise and urge entrepreneurs to invest in the nutraceutical industry, which has the potential to grow not in India and can bring India to the centre stage of the global industry.
(Disclaimer: The views and opinions expressed in this article are those of the author and do not necessarily reflect the views of YourStory.)