There’s nothing like the pride that comes with owning your own business. The problem is getting there — especially if you are interested in starting a supplement business.
Research shows that the sales of supplements reached $28 billion back in 2010, but the total was expected to jump to around $36 billion in 2017.
However, as an entrepreneur, it can be scary to take that first step toward success. That’s why we’ve compiled a guide on how to start a supplement company in 2018.
Let’s dig in!
1. How to Start a Supplement Company: Identify Your Target Customers
A common mistake that entrepreneurs mistake is that they don’t connect their product ideas to the actual consumers who may want to buy them. In other words, they don’t have target customers.
For some entrepreneurs, the problem isn’t that they lack target customers. Rather, their target customers are far too vague. For instance, “a health-conscious man” isn’t a feasible consumer group.
Yet other business people don’t establish their target customers until after they have already made their products. This is like putting the cart before the horse — a major mistake in business.
You know that you have correctly defined your supplement company’s target market if you can answer the following questions:
- Who are the customers? (e.g., people united by a health issue or profession)
- What are the customers’ needs? (e.g., vegans want more joint-health product options)
- Where do the customers make their purchases? (e.g., websites, events, retail outlets)
- Where do the customers acquire information? (e.g., magazines, blogs, trade publications)
- Can you solve the customers’ problems in an affordable way?
For instance, America Vitaminas offers a unique product called Melatonina Meladream, which is designed to help people to sleep better. However, this supplement is specifically designed for consumers who have to eliminate gluten from their diets due to celiac disease.
Yes, there are a lot of questions in the above list, and answering them might seem like a laborious task. But surveying consumers’ needs now will save you money and heartache down the road.
2. Decide How You’ll Acquire Customers
So, you know who your target customers are. Now comes the harder part — acquiring them.
There isn’t necessarily a wrong or right way to acquire customers. But the right way for you is the method you can work with and do the best.
Here are some popular advertising options for acquiring customers:
- Working events
- Direct selling
- Pay-per-click ads
The method that feels right to you subconsciously is probably the method you should go with. Listen to your gut when it comes to honing in on your company’s comparative advantage.
3. Analyze Your Competitors
This is another critical step when in starting your own supplement company. After all, even the most high-quality products won’t end up in consumers’ hands if they don’t stand out in the marketplace.
So, take a good look at what your competitors are doing, and ask yourself these specific questions:
- What customers are they targeting?
- What are these companies’ prices per ounce, capsule or pill?
- What are these companies’ major label claims?
- How are they reaching their customers?
Next, pay attention to the price of your own supplement. Note that having a paper-thin margin starting out — like a dollar per bottle — is not unreasonable.
Then, look for a new segment of customers that hasn’t been tapped yet when it comes to the particular type of supplement you want to market — for example, people who have restrictive diets, athletes or seniors.
Another option? Look for an undesirable key ingredient that your competition includes in its products that you can delete from yours. That may immediately make your product stand out for the right reasons.
Then, get to work on product formulation. You can do this with the help of a product development laboratory that works with entrepreneurial startups, helping them to turn their ideas into products that are ready to go on the shelf.
4. Get Your Business Set Up
If you’ve done the above steps, you’re in business — almost.
The next step in starting a supplement company is to select a business structure — such as a limited liability company — that will provide you with legal protection and minimize your tax liability. A Certified Public Accountant can help you to accomplish this.
Also, you’ll need to establish your website — something you can easily do with the assistance of a Web designer.
Then, you need to make sure that you have a business plan detailing where you see your business going in the next five years, for example. As the adage goes, if you fail to plan, you plan to fail.
Finally, start advertising. That means start your first blogs, buy up advertising space, collect emails or negotiate deals with advertising partners. It’s time to start planting seeds now.
5. Look for a Manufacturer
Now that you have a comprehensive product idea and a basic model for your business, you can begin approaching manufacturers.
This may seem like a daunting and even unaccommodating task. But finding a manufacturer who has a reputation for working well with industry newcomers can make the process far easier.
For starters, look for a manufacturer that is NSF compliant. In addition, be sure to go with a manufacturer that is open and timely from the beginning. First impressions truly do matter in business.
The manufacturer may have an in-house designer who can work with you on your product’s label, or you could choose one outside of the company. Either way, choosing the right designer is paramount so that you can get your label done correctly the first time.
How We Can Help
We offer a wide range of high-quality advice, information, and tips for aspiring entrepreneurs.
For example, through our site, you can learn about finding industrial material manufacturers, how to select the right website templates for your business and even how to market your company effectively.
Get in touch with us to find out more about how to start a supplement company and keep its bottom line strong in the months and years ahead.