Supplementing Your Profits

Supplementing Your Profits
Health Supplement Sales Continue to Rise

by Scott Eric Barrett

Salon operators who don't believe their salons are true retail stores probably aren't making as much money as their competitors. Most salons sell lotions, with great results, but the real success stories take place in the salons that sell ancillary items, beachwear, T-shirts, etc., as well as lotions. These items work because they blend well with indoor tanning. With all the potential retail sales boosters aimed at indoor tanners, health supplements might just be the best complement of all.

According to the Nutrition Business Journal, supplement sales were to reach $17.6 billion in 2002. In the past decade, the health-supplements market has tripled--from $5 billion in 1991 to $15 billion in 2001--and has drawn more attention than any other component of the alternative medicine revolution in the United States. It has gotten to a point where ginseng, ginkgo biloba and echinacea are so popular that Snapple is using them to sell drinks.

"It's very important that operators understand that they are there to sell merchandise," says Stacy Kaufman, president of Performance Brands in Sunrise, Fla. "Of course you want to sell the tans, but the real profit comes from selling any type of accessory merchandise. Health supplements just happen to be a perfect fit because the average person who tans is familiar with or has thought about taking health supplements."

It seems simple, but the world of healthy living is far from that. Unlike beachwear and candles, most health supplements are FDA-regulated items. Forget about the trendy stuff like vitamin C and E or Saint John's wort. Consumers can get them cheap at supermarkets and drug stores. Kaufman says the key to this market is niche items.

The Rules Of The Game

The health-supplement market has boomed since the passage of the Dietary Supplement Health and Education Act (DSHEA), and the ability to better educate consumers about supplements.

"The largest segment of our population--the baby boomers--has reached middle age and is looking for solutions that will slow the aging process and ameliorate the signs of that process," says Tracy Taylor, director of communications for the National Nutritional Foods Association (NNFA). "More specialty products are being developed to address these needs."

For the past several years, it had been predicted that the market had reached maturation, yet there has been a steady 4-percent to 5-percent growth each year. Also, as more research validates the therapeutic benefits of health supplements, their use will continue to increase, albeit not at the exponential rate of the immediate post-DSHEA years, Taylor says.

"Health supplements or dietary supplements are food supplements, not drugs--this is a very important distinction--and are strictly regulated by the Food and Drug Administration [FDA]," she says. "In 1994, the federal government passed specific legislation governing dietary supplements. The legislation, the DSHEA, regulates how manufacturers promote their products, and requires companies in the field to adhere to other broad-reaching regulatory guidelines. Makers of dietary supplements must derive their products from substances that are considered safe."

This is important because if a manufacturer wants to market a product containing an ingredient that was not used in commerce prior to the passage of DSHEA, the FDA must be notified in advance and provided with safety data. At any time, the FDA is fully authorized to require manufacturers to recall a product if the agency believes it presents a health risk.

"Under the DSHEA, makers of dietary supplements are limited as to the type of claims they can make about their products," Taylor says. "Statements of nutritional support, commonly referred to as structure/function claims, are restricted to explaining how a particular product or ingredient affects the structure or function of the body. A supplement maker may not claim that a product is intended to 'diagnose, treat, cure or prevent a disease.'"

The manufacturer must have substantiation that the statement is truthful and not misleading and must notify the FDA within 30 days after first using the claim in the marketplace. It's important for salon operators to understand and educate themselves and their employees about every supplement they sell.

A Niche Form Of Marketing

Weight-loss products, which are sometimes grouped with sports- nutrition products, sell well, Taylor says. Interestingly, despite an almost ongoing beating they take from state and federal legislators as well as media, weight-loss products containing ephedra remain popular.

"To really take advantage of this market, a salon should focus on niche-supplement sales--supplements that are not always available at your local store and that have a purpose like weight-loss," Kaufman says. "Weight-loss is a tremendous avenue for tanning salons to sell. People are always into diets. It just works well with tanning."

If a salon is not afraid to be a little risqu, sexual-enhancement products are very popular and becoming widely accepted since the Viagra launch, Kaufman says.

"I would stay away from gimmick products--stuff that is unproven like breast-enhancement products or the immediate weight-loss types of products," he says.

Tanning supplements are another niche item growing in popularity. "That is the biggest thing salons are missing out on," Kaufman says. "I am a big advocate of achieving the darkest tan through proper nutritional supplements. Our products possess what we call a tanner's blend of vitamins like proper tyrosine, beta carotene, B6 and copper, which all help give tanners a darker, longer-lasting tan."

An unknown social philosopher once said that money is to a man's social existence what health is to his body. Offer health supplements to your customers and your social existence can reap the benefits. The most important aspect of all is for salons to educate themselves before they decide to sell health supplements. It's a good idea to read magazines and go to the health-food store and ask questions. When you know what you're talking about, it's easier to make a sale.