The UK wellbeing sector encompasses everything from organic food, to homeopathic medicines, food supplements, natural medicines and external products, eg. skincare.
The one element these diverse product groupings have in common is real and potential growth in sales. Around 20 per cent of the UK population currently uses these products, but the level of media attention means that this proportion is likely to grow.
Factors affecting the wellbeing sector in the UK include:
- Buoyant economy and high disposable income.
- High consumer confidence.
- The UK population is becoming more middle-class, educated and aware.
- Increased coverage of alternative health issues in daily newspapers and magazines.
- More doctors willing to consider complementary therapies.
- Government easing the burden on the National Health Service by encouraging self medication.
- Products ameliorating the affects of aging are big business, as in all Western countries.
- Consumers are interested in more ‘natural’ products.
- Consumers are worried by animal testing.
- Wider use of Internet shopping and mail order.
Some of the issues are:
- Pending EU legislation for food supplements and herbal remedies.
- Removal of the retail price maintenance scheme which set standard prices for vitamins and OTC products.
- Inability to use any wording suggesting efficacy or health benefits on packaging or promotional material.
- Remedies classed as foods must comply with the Food Safety Act and other UK food legislation.
- Remedies classed as cosmetics or toiletries must comply with the Cosmetics Products Safety Regulations.
- Some products may need to be registered as a medicine.
- Competition from a wide range of cheap-source suppliers.
- No set industry standards.
All products exported to the UK are eligible for duty. Duty is taken as a percentage of the Cost-Insurance-Freight (CIF) price (total price per item including freight and insurance charges). The tariff code for each item in your range will dictate the duty rate applicable. Products made in third countries (eg. China) may be subject to quota. The way products and packaged sold and/or produced will dictate the tariff(s) that apply.
All beauty and wellbeing products that are sold in the UK and are considered a cosmetic or toiletry product under EU definitions must be tested in an EU laboratory and issued an EU safety assessment certificate. Full details on the regulations process and laboratory contact details are available from the Cosmetics, Toiletries and Perfumes Association (CTPA).
The labels on all cosmetic and personal care products must contain a list of ingredients used. They must also contain an EU contact address. Some products require a 'Period After Opening' symbol (an indication of how long the product remains usable after opening). To avoid re-packaging, some companies choose to place a sticker on their items to record the details of the EU address, and insert symbols such as those described.
A division of the Health Food Manufacturers’ Association - LAPAD - runs a label assessment service which provides full details on the above.
Under EU law, if you are selling an unregistered product, direct claims cannot be made on the packaging (or within the name) of a product. The use of words such as 'heals', 'cures' and 'fixes' should be avoided. Further details are available from the CTPA.
It is more difficult to sell directly into a retailer or achieve volume without an importer/distributor, particularly since one characteristic of the health food sector is a dependence on wholesalers – intermediaries who act as the link between the importer and the smaller retailer. Wholesalers generally do not import directly, preferring to buy from local importers.
Market entry strategies include:
- Appoint a distribution partner to handle importing and customer liaison.
- Manage the customer base from Australia and find a fulfilment company to warehouse and ship to the customers.
- Set up a UK office.
- Send one of your staff to the UK as a representative;
- Share distribution with another Australian company – preferably with a synergistic product range.
- Manufacture your products in the UK under contract or license.
- Undertake a joint venture with a UK company.
Health Food Manufacturers Association – www.hfma.co.uk
Cosmetics, Toiletries and Perfumes Association - www.ctpa.org.uk
British Complimentary Medicines Association – www.bcma.co.uk