Heather Granato, VP of content at Vitafoods, believes supply and demand has traditionally been a universal problem. However, she says there are transparency issues due to geography and the number of people in the supply chain that urgently need to be resolved.
She explains: “I think the issues were there, but we didn’t have to confront them because it wasn’t a fix-it-or-else situation.
“It’s been exacerbated because of pandemic. We’ve always had these issues but anything that was an issue in the supply chain broke during Covid. That happened to every industry and we are certainly not unique, but we then saw that nutraceuticals were considered essential in many markets.
“We saw demand spike and then it was a case of scrambling to find new suppliers.”
The effect of ‘just-in-time’ model issues has also been highlighted as a result of the pandemic, according to Granato.
She says: “The just-in-time issue has been really exposed as a challenge.
“It’s great to maximise efficiencies in the supply chain and that works really well when things are going well but if you end up with all of your botanical ingredients stuck on a cargo ship that’s out at sea for an additional six months and nothing can be done about it, that’s an issue.”
The consequences
The problems in the supply chain can have long-term effects and therefore shouldn’t be ignored, according to Granato.
She explains: “If you can’t fulfil orders then you lose revenue, and you lose consumer trust because the consumers can’t get the products.
“Also, if they’re getting products that don’t contain what they say they do or don’t contain it in the right amounts then they’re not going to feel that efficacy. They’re not to going to continue to purchase so that lack of consumer trust harms the base of the industry.”
However, Granato also believes there can be positive consequences too, as it encourages the industry to get creative.
She says: “You will see innovation as people look for new solutions.
“For example, the lack of packaging has led to manufacturers and suppliers looking at different packaging technology. I think three-dimensional printing will be part of our broader industry in the future.
“We’ll see more transparency and technology will facility that. It will also facilitate trade and we’ll see more blockchain. That technology enables the transparency.”
Building resilience
In order to build resilience, there needs to be a focus on multiple sources so that manufacturers and suppliers aren’t just reliant on single sources, Granato insists. She believes there’s a balance to achieve in order to build mutually beneficial relationships with suppler partners.
Granato explains: “Fewer suppliers is appealing until they run out and you don’t have any other suppliers that you trust to work with.”
According to Granato, another way to build resilience among nutraceutical manufacturers and brands is to by offering support to the entire supply chain.
She says: “How do you build resilience? You build trust and you verify. You don’t just rely on trust. We need qualifications, auditing etc.
“Our microbiome is a powerful thing and sometimes you just want to trust your gut, but that’s not always enough.”