The Statistics Bureau of the Japanese Ministry of International Affairs and Communications has reported the results of its Family Income and Expenditure Survey of 2004. In this Survey, the Ministry calculated the size of the retail-base market (annual expenditure per household x total number of households in Japan) for *tablet/capsule formed foods (dietary supplements), and has shown that it has grown to 677.7billion yen (6.5billion US$) for 2004, achieving a year-over-year total of 115%.  Expenditures per household have grown 2.3 times over the past ten years, steadily increasing from 2000.

The survey for “two-or-more-person households” showed that the monthly average of living expenditures was 304,203 yen, dropping to 96% of the 1995 number. However, annual expenditures for tablet/capsule formed foods have grown 227% (about 2.3 times) reaching 15,038yen.

According to the data which analyzed the market for 10 years after dietary supplements were first included in the Family Income and Expenditure Survey in 1995, there was only a gradual expansion until 2000, which, after 2001, skyrocketed to reach the 2.3 times growth.  Among the nearly 800 consumer goods categories listed in the Survey, tablet/capsule formed foods has grown the most rapidly, surpassing even shochu (clear liquor distilled most commonly from sweet potatoes, rice or buckwheat) which showed 1.6 times growth in the past 10 years. The Survey also reported the percentage of purchasing households and purchase frequency for each expenditure item, and both numbers are increasing year by year for tablet/capsule formed foods in the past 10 years. Each has increased threefold, pushing the high growth in expenditures. In 1995, only 5 out of 100 households were purchasing dietary supplements, but today, 11 out of 100 households use them. This is nearly the same percentage as happoushu (beer-like drink brewed with under 67% malt) which is 18%.

On the other hand, compared to other foods, expenditure per purchase for supplements has decreased more than 20% in the past 10 years (5,967yen for 2004), largely due to the difference in unit prices, according to distribution channel and items. In the “Survey Reports on Usage of Dietary Supplements” published by the Tokyo Prefecture in 2000, average unit price per purchase was 4,529 yen, and 60% of the consumers considered the price for dietary supplement “ too expensive” and 19.9% “rather expensive”, totaling nearly 80% of the consumers who considered dietary supplements ‘expensive’.
 
The decrease in expenditure per purchase might potentially have resulted in an expanded consumer base, however, as more dietary supplements diffuse throughout society, chances are that more people will continue to stay away from the more expensive products.
Regions where tablet/capsule formed foods are the most consumed have traditionally been Kyushu and Okinawa, but this year, Okinawa has dropped to become a lower consuming region, and some low consuming regions are moving closer to the average. Nationwide, distribution of products is gradually addressing the regional disparity. As far as the age of consumers is concerned, those over 50 are heavy users of dietary supplements, and the older the members of the household, the higher the expenditure. Looking at the expenditures by the age of the head of the households for the last 5 years, compared to consumers aged 40 years and below, expenditures of consumers in their 50’s and 60’s, especially of baby-boomer women, have soared rapidly. It is obvious that these advanced age, but active women will continuously be a strong driving force behind the demand for tablet/capsule formed foods. 
 
One thing we must keep in our mind is the experience of 2002. In this year, there were some scandals in the industry which strongly alienated the consumers. In January of that year, fraud by the company, Hachiyou Butsuryu, was reported, and in July, issues concerning weight controlling food from China were on the news for days. From these months on, expenditures for tablet/capsule formed foods showed a sharp decline until the industry recovered consumer credibility 15 months later. With a favorable wind now blowing for this industry, companies now have a chance to establish their GMP’s and compliance.

* In the above Survey, tablet/capsule formed foods are called “health fortifications” including tablet, capsule, granular, powder, or liquid (extract) formed foods. Examples include soft shell turtle, aloe, kale, Korean ginseng, plum extract, chlorella alga, green vegetable juice, etc.