Inspection and track and trace solutions for nutraceuticals.
More than half (55 percent) of consumers say having “transparent and open business practices” builds trust in a company and trust in a company makes consumers more likely to buy their product (68 percent), recommend them to a friend or colleague (59 percent) and even pay more for a product (37 percent).1 In the nutraceutical market, transparency often results in increased sales; according to The ROI of Transparency, one in five U.S. consumers make a transparent vitamin and supplement brand their first choice2 and in a survey conducted by Trust Transparency Center, 67 percent of U.S. supplement consumers polled stated that transparency impacted their supplement choice.
“For consumers, transparency means showing or making available critical information beyond the minimum. This can mean the ways they source and produce, their values and relationships, certifications, branded ingredient logos and other differentiators.” said Len Monheit, CEO of Trust Transparency Center and executive director of the Probiotic Association.
There are several opportunities for nutraceutical manufacturers to be transparent throughout the manufacturing process and as the clean and sustainable movements continue to drive the market, the consumer desire to be more informed will continue to increase, in turn placing pressure on manufacturers to digitize their operations.
Need for Transparency in Nutraceutical Manufacturing With the Help of Track and Trace and Inspection Systems
A March 2013 U.S. Government Accountability Office report, noted that over the period of 2008-2011, the FDA (U.S. Food and Drug Administration) received 6,307 adverse-event reports related to dietary supplements.3 This is in large due to the FDA and other regulatory agencies rarely testing dietary supplements and other natural items, leaving the manufacturers and distributors of these goods solely responsible for their transparency and honesty.
A track and trace solution can improve several processes at once while providing transparency about the product to the consumer. Developing an operation that is effective, complies with requirements, and provides data to the end user with information such as origin of raw materials, accurate dosage-levels, smart packaging, while tracking every aspect of the supply chain builds a rapport with customers and helps to influence their buying decision.
Transparency in Ingredients & Formulation
Product and ingredient adulteration is a consumer and manufacturer concern throughout the nutraceutical industry. According to a study conducted by the California Department of Health, from 2007 to 2016, the FDA logged 776 dietary supplements as being adulterated
with pharmaceuticals but less than half of those products were recalled.5 There are many ways for a manufacturer to ensure ingredient quality and provide consumers transparency in the formulation.
• Ingredient Identification Verification: Confirms the ingredient through technology such as DNA testing and macroscopic and microscopic analysis.
• Potency: Confirms the concentration of an ingredient.
• Purity: Purity tests confirm that there has been no adulteration from undesired sources like micro contaminations or metals. These include tests for mold, chloroform, yeast, salmonella, E. coli and heavy metals.
• Spiking: Ensures that there has been no extra fortification, such as the addition of actives that don’t occur naturally.
• Contamination: Confirms that no banned pesticides are used during cultivation and that authorized pesticides are applied responsibly. Also verifies that levels of heavy metals are not above acceptable limit.
Transparency in Labeling
The Nutrition Labeling and Education Act of 1990 amended the Federal Food, Drug and Cosmetic (FD&C) Act, requiring that most foods, including dietary supplements, bear nutrition labeling. In 1994 it was updated, in part, by defining dietary supplement, adding specific labeling requirements for dietary supplements, and providing for optional labeling statements. In 1997, the FDA implemented DSHEA (Dietary Supplement Health and Education Act of 1994) by publishing several key regulations (62 FR 49826) on the statement of identity, nutrition labeling, ingredient labeling, and nutrient content and health claims for dietary supplements and amended it in 1998 to include nutrition labeling of extracts used in dietary supplements.6
A supplement label should be several things; it should be aesthetically appealing to the buyer and provide brand differentiation, while abiding by FDA guidelines to have a complete ingredient list, an accurate amount contained, provide nutrition labeling and manufacturing location details. Proper labeling laws must be observed closely, and as this industry expands, we should anticipate that these rules will continue to alter and evolve.
Accurate labelling of infrmation is vital, but manufacturers must take caution when making claims and promises to be “all natural” or “pharmaceutical grade.” Labeling claims fall into four categories; 1) Health claims show a link between a food or substance and a disease or health-related condition. 2) Nutrient claims describe the level of a nutrient in a food or dietary supplement, 3) Structure/function claims refer to the supplement’s effect on the body’s structure or function, including its overall effect on a person’s well-being, and 4) Qualified health claims that describe diet–disease relationships and summarize the quality and strength of evidence for a claim.7
Transparency in Packaging
Packaging manufacturers have begun upgrading the traditional packaging systems with more intelligent, connected, interactive and capable of performing smart functions such as tracking and tracing solutions to meet customer demands.
Designed to improve product quality and shelf life, ensure safety and prevent counterfeiting, manufacturers can track and record product information at various stages of the manufacturing process, transport and distribution. This data is also a great resource for customer mapping, buying personas, buying patterns and the customer journey, allowing for a more personalized buying experience.
Transparency in Supply Chain
In the nutraceutical industry the number of transactions that occur during the manufacturing process—from the seed of a natural ingredient to the final product on the shelf—is astounding and managing the complexities of this worldwide supply chain may be a difficult and daunting task without the integration of traceability and inspections systems.
A digital supply chain provides more visibility while improving agility and efficiency; it integrates and applies advanced digital technologies into supply chain operations, from procurement data, inventory management to transportation and distribution. Organizations can digitize physical assets and create a decentralized immutable record of all transactions, making it possible to track from production to delivery.
Companies planning to move forward with their transparency journey need to look at blockchain as an amazing tool that can make global supply chain transparency a reality. Blockchain is a digital ledger that keeps track of a collection of transaction records known as blocks, results in a fully transparent, continuous sequence of transactions and a non-manipulatable audit trail.4
The Future of Transparency in Nutraceuticals
With 77 percent of U.S. adults reporting they consume dietary supplements, according to a Council of Responsible Nutrition (CRN) 2019 Consumer Survey on Dietary Supplements and the Business Journal reporting that by 2023, supplement spend will be $1.4 billion higher than pre-COVID with 2020 sales having topped $50 billion,8 the transparency and digitalization “trend” will undoubtedly continue to be a key factor in the competitive business of manufacturing nutraceuticals. As consumer awareness and consciousness around traceability and digitization continues to grow, brands making a step forward and disclosing information on their supply chain will have a competitive advantage in the marketplace.
“Over the past few years, new consumers have entered this category. They are of a different demographic with different values. In order to retain them, we are going to need to push ourselves—sometimes into the uncomfortable, for them to stick with us. This means opening doors into thinking and sourcing processes, suppliers chosen (and perhaps even not selected) and having information ‘at the ready’ for when they want to dig deeper into who we are as companies ” Monheit added.
When it comes to standing out in the nutraceutical market, transparency is crucial. Brands who make sincere claims, employing tested components, high quality ingredients, and emphasizing all of these qualities right on the package label will build a rapport based on trust and transparency often resulting in customer loyalty and repeat sales. NIE
References:
1 Transparency and trust: The risks and opportunities of content marketing. The Economist Group. February 19, 2016.
2 www.purebranding.com/roi-of-transparency/.
3 U.S. Government Accountability Office report. “Dietary Supplements: FDA May Have Opportunities to Expand Its Use of Reported Health Problems to Oversee Products.” March 2013. Accessed. at: www.gao.gov/assets/660/653113.pdf.
4 www.nutritionaloutlook.com/view/can-blockchain-save-dietary-supplement-industry-transparency.
5 Tucker J, Fischer T, Upjohn L, Mazzera D, Kumar M. Unapproved Pharmaceutical Ingredients Included in Dietary Supplements Associated With US Food and Drug Administration Warnings. JAMA Netw Open.2018;1(6):e183337. doi:10.1001/jamanetworkopen.2018.3337.
6 FDA. Dietary Supplement Labeling Guide. Published April 2005.
7 www.fda.gov/regulatory-information/search-fda-guidance-documents/small-entity-compliance-guide-structurefunction-claims.
8 www.nutritionaloutlook.com/view/dietary-supplement-sales-success-post-covid-how-can-industry-keep-the-momentum-going-after-the-pandemic.
Evelyn Reinson is the Head of International Marketing at ACG, responsible for global marketing strategies of the company’s product range of capsules, films & foils, engineering, and inspection worldwide. For more information, visit www.acg-world.com.
