Indonesia’s State of Health and Investment Opportunities in Food Supplement Business

The Indonesian economy has been growing at a staggering pace in the past decades, but the country’s state of health is currently facing complex problems including in the sector supplement Indonesia. 

Due to the lack of national reformulation agenda by the government, the majority of consumers depend on the food industry for healthier products. Therefore, they have a pivotal role to play in restructuring national health by providing more healthy products to Indonesian citizens.

Health Supplement Market Landscape in Indonesia

According to Statista, Indonesia’s revenue in the Vitamins & Minerals segment is expected to clock USD 3.04 billion in 2023 and is set to grow with a CAGR of 6.43% through 2029. The segment only comprises over-the-counter natural and synthetic food supplements.

In addition, World Bank data also show that Indonesia’s health expenditure per capita is on the rise, from US$160.64 US dollars in 2021 to US$391.73 in 2023, growing at an significant rate of 143.86%. By 2025, expenditure is projected to continuously grow to US$ 409.87 per capita, reflecting a 2.4% increase of the previous year.

This increase is mainly due to higher demand from the younger population; Indonesians’ standard of living is rising due to better-paying jobs, which increases the size of the middle class, which in turn spends more on health products, including food supplements. 

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Supplement Indonesia: Prospective Consumers

From fulfilling the demand for cereals to diversifying diets towards more balanced nutrition, Indonesia is leaving no stone unturned in bolstering the Health and Food Supplement market. Following are some key market drivers for food and nutrient supplements in Indonesia.

The Middle Class

Over the past 15 years, Indonesia has witnessed its middle class grow from 7% to 20% of the population. Subsequently, their consumption has also been growing at 12% annually. Accompanied by a high rate of urbanization, the dietary patterns have shifted towards more balanced nutrition. Access to the latest information has led middle-class consumer demands towards healthier and more diversified food. 

The Elderly Population

Life expectancy in Indonesia has risen phenomenally from 45 to 69.2 for males and 73.6 for women. Furthermore, the birth rate has also declined dramatically, making Indonesia the fifth-largest country to have an elderly population in the world. 

As the elderly body’s capacity to absorb nutrition from food often gets reduced, it renders them rely majorly upon vitamin supplements to balance their diet. 

The culmination of all these market drivers coupled with the fact that most supplements are imported (according to Ministry of Health data in 2017) has set the stage for foreign investors to capitalize on untapped potential opportunities available in the market.

READ MORE:

• Why Does Food Safety Matter for Indonesian Products?
• How to Start a Wholesale Pharmacy Business in Indonesia

Regulation of Indonesia’s Food Supplement Registration

Before registering a health or food supplement product, it is crucial to understand the regulatory complexities to ensure a smooth registration process. In Indonesia, the National Agency of Drug and Food Control, known as Badan Pengawas Obat dan Makanan (BPOM), oversees the regulation of food and health supplement categories.

According to BPOM Regulation Number 11/2020, food classified as health supplements is intended to meet nutritional needs and support, enhance, or improve health functions. BPOM enforces rigorous control over drugs and food circulating in Indonesia through a comprehensive process that includes thorough pre-market assessments and ongoing post-market monitoring to ensure compliance with safety and quality standards.

Food Supplement Registration Category in Indonesia

According to BPOM regulations, food supplement registration is divided into new registration and various registration. New registration is required for first-time registrations, while various registration is necessary for changes to existing products, such as reformulations, packaging updates, or ownership modifications.

Each registrations type includes specific categories tailored to different supplement types, including:

New Registrations	Various Registrations
Category 1: Products with one or more ingredients (vitamins, minerals, amino acids, carbohydrates, proteins, fats, or other isolates)	Category 4: Products with changes in product name, packaging size or design, labeling, factory name, and importer name without ownership status changes.
Category 2: Products with one or more ingredients in category 1 and natural ingredients	Category 5: Product with changes in raw material or finished products analysis methods, stability, production technology and production location.
Category 3: Products from category 1 and 2, with claims of new usage, new dosage, and new dosing regimen.	Category 6: Product with changes in formula or composition with the main ingredients belong to one group and ingredients addition.

Requirements for Food Supplement Registration in Indonesia

These following documents are mandatory to register your food supplement product under BPOM in Indonesia:

1. Administrative Documents

• Company profile and proof of business registration (e.g., Business License or NIB in Indonesia).
• Manufacturer’s license (for local manufacturers) or an import license (for imported products).
• Letter of authorization (LOA) from the product owner, if applicable.
• Certificate of Good Manufacturing Practices (GMP) or equivalent.
• Statement of free sale or distribution approval from the country of origin (for imported products).

2. Product Information

• Complete product composition/formulation, including active and inactive ingredients with their respective concentrations.
• Detailed manufacturing process or flowchart.
• Product specification sheet, including physical, chemical, and microbiological properties.
• Certificate of Analysis (CoA) from an accredited laboratory.
• Stability test report to ensure product shelf life.

3. Labeling and Packaging

• Draft of product label in Bahasa Indonesia (e.g. product brand, ingredients list, net weight, usage instructions, expiry date, and manufacturer or distributor details)
• Packaging design, including primary and secondary packaging materials.

4. Safety and Efficacy Documents

• Scientific evidence or studies supporting health claims.
• Toxicological and safety assessments for new or novel ingredients.
• Evidence of the product’s intended use or health benefits.

5. Import-Specific Documents (for Imported Products)

• Import declaration or permit from relevant authorities.
• Halal certification
• Customs clearance documentation.

6. Additional Requirements

• Sample of the product for laboratory testing.
• Payment receipt for the registration fee.
• Any specific documents requested by BPOM, depending on the product type or category.

Food Supplement Registration Procedure in Indonesia

For starting a business in Indonesia as a foreigner, company establishment is required to proceed to product registration. The two common types of legal entities are PT PMDN (Local Company) and PT PMA (Foreign Company).

After setting up, the company also must have an Indonesia Import License – locally known as Angka Pengenal Impor (API) in order to become an importer in Indonesia.

Subsequently, it is also mandatory to go through The Standard Procedure of Food Supplement Registration to start a venture in the food supplement industry. One must go through the stretch of processes including pre-assessment of required documents and assessment of the actual products by the Agency of Drug and Food Control Republic of Indonesia.

Also, since the majority of the population in Indonesia follows Islam, investors should certainly care about halal certification issued by Indonesia Ulema Council (MUI) as well.

Seize the Potential in Indonesia’s Food Supplement Business with InCorp

Complying with the local regulations of product registration, import-export, company establishment, and halal certification may be challenging to investors. Thus, it is always viable to have an outsourcing entity like InCorp consult you through the stretch of these processes. We offer comprehensive one-stop solution service, including:

• Company Registration: We will guide you through Indonesia’s regulatory landscape, ensuring a seamless and hassle-free business setup.
• Product Registration: Enter Indonesia’s thriving food supplement market effortlessly with our comprehensive, end-to-end support.
• Halal Certification: Our expert consultants offer tailored insights and assistance to simplify the process of obtaining Halal certification.

Contact us today to discover how we can support your investment in Indonesia’s wellness industry!