International Joint Ventures and Merger & Acquisitions

Amway Plans to Take Herbal Range Overseas

September 04, 2018

The demand for herbal and natural products has increased manifold in the recent past. People are switching to natural healers and supplements for the long term benefits.

The demand for herbal and natural products has increased manifold in the recent past. People are switching to natural healers and supplements for the long term benefits. Considering the increasing popularity of herbal products in the overseas market, Amway India has planned to conquer this newly expanding territory with its indigenously manufactured product range.

Anshu Budhraja, Chief Executive of Amway said, “Based on the response met by our Nutrilite traditional herbs range over the past six months, we are exploring options to take the products global”. Amway is one of the top direct selling firms in India with a worth of 18 billion. In this, nutrition contributes around 55 per cent share followed by around 12-15 per cent by beauty segment, 20 per cent from home care and 10 per cent from personal care and rest from others. In near future, the company also plans to launch its consumer durable products by introducing air purifier and water purifier segments.

Presently, India is the seventh largest market for Amway and is growing with a CAGR of 20 per cent which he predicts to be placed among top three by 2030 as they prepare to add new categories such as consumer durables and launch new products in the beauty segment. Recently, Amway also invested Rs 6 billion in a manufacturing facility in Tamil Nadu as part of the Rs 10 billion investment plan in India. The company plans to supply to the European and African markets from this facility.

Amway, the maker of Satinique shampoo and Artistry skin-care, launched a naturals range earlier this year and projected sales of 1 billion for it by year-end. It has been persistently working hard to strengthen its base and visibility in herbal and natural space. Patanjali and Dabur are its major competition with numerous herbal and natural products in the market.

According to the Euromonitor’s research reports, in 2017 Amway emerged out to be the leader of vitamins dietary supplements with a total market of 94 billion, with 12 percent market shares. Moreover, almost 29 percent of this category comprises traditional vitamins and dietary supplements. Euromonitor predicts the category to grow around 10 per cent over the next five years. Presently, Amway has five Rs 1 billion brands in its portfolio which include Nutrilite All Plant Protein Powder, Nutrilite Daily, Amway Queen Cookware and Glister toothpaste. Besides, Amway plans to launch its latest herbal range in the beauty and personal care category to cash on the opportunity of growing awareness on such products.

Amway India is a wholly-owned subsidiary of Michigan, US-based Amway, which has the world's largest direct selling business. The India arm of the Michigan-headquartered maker of health, beauty, and home care products has committed investments of 1 billion in the country, and is targeting sales of 6 billion by 2025, it said.

Anshu Budhraja said the growth in the demand of herbal and natural products is fuelled by the increasing focus of consumers on precautionary healthcare options. The traditional remedies with organic certification and high level of active ingredients are inclining people in India and overseas towards Amway products and driving the growth. About investments, he said Amway plans to invest around Rs 1 billion in next 2-3 years in India, which includes Rs 0.7 billion investment in R&D, Rs 0.1 billion in manufacturing and Rs 0.2 billion-0.3 billion in digital initiatives to promote e-commerce.

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