Yakult unveils US volume surge as good bacteria message gathers pace

US consumers now drink around 142,000 bottles of Yakult's probiotic fermented dairy drink a day, 24% more than they were gulping down this time last year.*

While this is small fry compared with the 2.1m bottles a day consumed in China and the 3.26m bottles a day knocked back in Mexico, the number is growing fast and is not far behind markets such as the UK (236,000/day), the Netherlands (230,000/day) and Singapore (200,000/day), where Yakult has been marketing its products for significantly longer.

And while Yakult USA still remains a relatively small player in its global probiotics empire, it is a key area of focus for the Japanese firm, which will open its first US factory in Fountain Valley, California, in the fall of 2013.

Group profits up 0.9%, net sales up 2.2%

The figures were released as Yakult posted a 0.9% rise in net income to ¥13.29bn on sales up 2.2% to ¥312.55bn in the year to March 31, 2012.   

Food and beverages sales in the Americas were up 3.9% to ¥39bn and up 25.4% to ¥32bn in Asia and Oceania in the year to March 31, 2012. Sales in Europe dropped 7% to just over ¥8bn over the same period.

While more than half of its revenues are still generated in Japan, Yakult has been steadily increasing its presence in overseas markets, and has notched up strong volume growth in the US, China, India, Brazil, Indonesia, Malaysia and Australia this year.

However, it has struggled in many parts of Western Europe (with the notable exception of Italy) as competition has increased, and has seen drops in volume in the UK, Belgium, Germany and Austria.

For the next financial year (to March 31, 2013) it is predicting flat growth in Europe, 2.5% growth in the Americas and 27% growth in Asia/Oceania.

New Fountain Valley CA factory operational in the fall, 2013

Yakult, which has just completed the self-affirmed GRAS process for its proprietary probiotic strain L. casei Shirota, plans to start construction on its Californian factory this summer, with the first bottles of Yakult likely to roll off the production line late next year.

The factory is a short drive from Yakult USA’s HQ in Torrance, CA, and will supply stores in California, Nevada, Arizona, Texas, Colorado and New Mexico (which are currently supplied by its factory in Guadalajara, Mexico),  but will also provide a platform for expansion into new regions.

Probiotics in the US

While US consumers were introduced to the concept of good bacteria a little later than their Asian and European counterparts, sales are growing fast with per capita spending on probiotic supplements forecast to almost double over the next five years in the US according to Euromonitor International.

Speaking at Pre-& Probiotics 2012, a virtual conference and expo hosted by NutraIngredients-USA and NutraIngredients in March, the market researcher’s head of health and wellness research Ewa Hudson said global sales of probiotic supplements were predicted to rise 48% from $2.7bn in 2011 to $4bn in 2016.

Within that, the strongest growth was coming from the US, which generated new sales of $140m in 2011 alone, she claimed.

 “In the US, per capita spending on probiotic supplements is expected to nearly double by 2016 and overtake Japan.”

Global sales of probiotic foods and supplements predicted to grow by 50% from 2011-2016

However, strong growth is predicted for probiotics across the board, predicts Euromonitor, which forecasts that global sales of probiotic foods and supplements will surge by 50% in the next five years from $28bn in 2011 to around $42bn in 2016.

For yogurt, said Hudson, the majority of growth is coming from emerging markets, particularly Brazil and China. However, there was also strong growth in the US, she said.

Probiotic yogurt grew faster than non-probiotic yogurt every year from 2006 to 2011 reaching nearly 35% of global yogurt sales in 2011.”

Probiotics, health claims and the US consumer

As for communicating the benefits of 'good bacteria', Mike Bush, vice president of business development at probiotics expert Ganeden, said: "The science must be relevant to the consumer, so avoid discussing gene expression in mice".

He added: “If you look at launches, claims are increasing but at the same time they are becoming a little softer. ‘Contains probiotics’ is the top claim consumers are looking for, or ‘supports digestive health’, ‘supports immune health’.

*The figures are based on an average of bottles of Yakult sold in January to March 2012 and are compared with the average number of bottles sold in January to March 2011.