China is becoming increasingly important to Herbalife Nutrition's global business map, a key executive of the global nutrition company has said.
The firm's Changsha factory has been playing a critical role in its global production, as well as in research and development, and the further opening-up of the Chinese market offers more potential to tap, said Zheng Qunyi, chairman of Herbalife Nutrition China, on Thursday.
"Plant extracts from China are now a key factor contributing to our large global product portfolio," Zheng said, adding the Changsha factory now produces about 700 metric tons of plant extract annually, and about 80 to 90 percent of the extracts are exported as ingredients for the global market.
Plant extracts are the most important ingredients for Herbalife Nutrition's diversified products, apart from protein powders extracted from soybeans, according to Zheng.
Because the company produces plant extracts in the Changsha factory, instead of sourcing from suppliers, it now has a high level of traceability across the whole production chain, which is key to ensuring high product quality, and has become the company's biggest advantage in the fierce competition within the industry worldwide, he said.
Since it entered China in 2005, Herbalife Nutrition has seen healthy growth, despite the slowdown of the global nutrition industry.
The country is now Herbalife's third-largest market, after the United States and Mexico.
Apart from the Changsha factory, the company has built four research centers, five flagship stores, and two product production factories respectively in Nanjing and Suzhou of Jiangsu province, employing about 1,200 locals in China.
Revenues in 2017 were about 7 billion yuan ($1 billion), and revenue growth rates in the second and third quarters of 2018 reached 27 percent, yet the future market prospects are even more promising, according to Zheng.
The company's business fits well with the country's Healthy China 2030 initiative, and China's further opening-up promises a better business environment for foreign companies such as Herbalife Nutrition, he said.
Also, the large Chinese population, as well as rising body weight issues, indicate fast-growing market demand for Herbalife Nutrition's nutrition and weight management products and services, he added.
The Chinese healthcare market is expected to reach 16 trillion yuan by 2030, according to the Healthy China 2030 blueprint released by Chinese authorities in October 2016.