Confucianism, Communism, Collectivism...Crossfit??? Healthy Living: China's Next Big Growth Market and How to Make $$$

Takehome:

• On June 23rd, 2016 China's State Council unveiled its national strategy to improve the health and physical fitness of Chinese people, setting aside 1.5 trillion RMB ($225 billion) for investment in sports and fitness by 2020.
• The CAGR of China's sports nutrition sector (2012-2017) is 20% with best estimates placing the value of the market between 70m and 100m US $ (just a fraction of the value of the US market) with plenty of room for the forecasted upward growth trajectory.
• China's markets are dominated by protein supplements with +90% of its value coming from sale of these products.
• The number of people engaged in recreational physical activities rose from 360 million in 2015 to 434 million in 2016.
• Chinese regulations for sports nutrition and related general foods impose relatively basic market entry barriers and when combined with the market data and optimistic growth projections offer favorable investment conditions. In addition China has extremely diversified retail channels for this sector with ecommerce and crossborder ecommerce performing extremely well and more recently China is becoming even more diversified in its retail channels with in-house gym based promotion and retail growing strongly.
• The primary legislative and regulatory references governing this sector of China's food industry are: The food safety Law and national food safety standards - GB 24154-2015, GB 13432 (labeling of foods for special dietary purposes) and GB 14880 (Nutritional fortification e.g addition of Vit A etc.) in addition to all the horizontal standards which stipulate requirements for all foods (food addtive, general foods labeling standard etc.)
• Regulatory requirements of foods catagorized as sports nutrition are articulated within GB24154 and are defined based on two different classification systems 1) Macronutrient and Energy Profile (Protein supps, carb sups, low calorie supps) 2) Functional characteristics (Speed, power, endurance, recovery)
• Related sectors categorized as general foods are also characterized by favorable regulatory environments, market data and growth projections. Notable examples include China's high protein yogurt market, nutritionally fortified beverages, use of ingredients from "new food raw materials list" and "list of foods considered as food and Chinese medicine" in general foods, nutrient supplements etc.
• The Innovation lag opportunity...The phenonmenon whereby developments in The West take several years before they are adopeted and become mainstream in China is extremely significant in China's healthy living boom and is something international skateholders can leverage to their advantage.

The Lycra Pants Index - The Most Reliable Surrogate Marker Predicting Growth in China's Healthy Living and Sports Nutrition Sector

The correlation has to be real... i just havent proven it yet. What correlation you say? Its between the increasing number of people here in China wearing "athletic" compression wear, knee high socks and "high-tech" training wear and growth in healthy living sector and sports nutrition. (Ps if there's anyone that wants to put lots of money into funding this highly significant groundbreaking study id be all ears :)

Ive been in China for a what feels like a long time now, a year in the Northeast (东北）in 2009 and then here in Hangzhou from 2013 to present day. Ive seen alot of things change but I have a particular interest in changes in healthy lifestyle apporoaches, nutrition, gym lifestyle, and general strength and conditioning programs and practices.

Something that Ill never forget was the first time i busted out my foam roller here in China to do some preworkout self myofascial release, I was pretty much treated like how id imagine a time traveller busting out a cigarette lighter to cavemen would be treated. To the unaccustomed eye rolling around the floor, of ones own volition, on a foam covered PVC pipe, breathing heavy and intermittently grimacing in pain is fair grounds for a quick call to the local authorities so i fully understand the looks morbid fascination on the faces of the 东北人 as grinded through a preworkout roll of the TFL and high hip flexors. The impact of this image is only mangnified when the setting is 2009, in a bodybuilding gym in a relatively obscure city in the northeast of China and the person doing the rolling is a 6ft2, 220 pound, pasty Irish man. I reckon an acutal extraterrestial alien would have been greeted with less amazement.

Functional Training Becoming Functional Decorations

Fast foward to 2018, you can go to any gym here in China and the litmus test for the quality of a gym is the number of foam rollers, kettlebells, truck tyres, hex-bars, heavy bands and all sorts of MMA equipment that essentially 99% of Chinese gym goers have no idea how to or no interest in using. So while the goal of this equipment is to foster beast level athleticism, the actual result is just a large array of interesting resting places for gym goers to end their last set of cable flys and chase thumb hypertrophy with a well deserved superset of mobile world of warcraft.

Innovation Lag....

Innovation lag is the term i use to describe the phenemenon where fitness and nutrition practices and trends which have already been developed and become established in The West, things like the afore mentioned hex bars, truck tyres, kettlebells foam rolling and other things like post workout whey, intraworkout BCAAs, new training modalities etc. take several years before they begin to make their way into Chinese gyms and become mainstream.

Chinese Gym Goers Seem Willing To Spend...

A lot of times when im at the gym it genuinely seems like there are more coaches than normal people. For the most party Chinese people are willing to shell out some pretty hefty fees to hire a coach and help them on their journey to perfection.

Blinded By Science...

Its amusing and a little baffling to see the new breed of Chinese coach spend 15-20 mintues trying to explain the importance of proper scapular control to some dude with the conditioning of a bar of butter and a massive belly to match. The lad just wants to lose some weight and gain some muscle, the fact a coach has learned what scapular retraction was 3 days ago and wants to impress their trainee with big words shouldnt mean you waste his 350 -500 RMB an hour time with your bullxxxx... Just give him a skipping rope and help the lad do some work.

Fortune Favors the Brave..

But i digress...The signs of the pending boom in China's healthy living and sports nutrition sector are obvious. However if business history in China has taught us anything it is that "opportunities" in China are transient at best. Chinese entrepreneurship and business in general is hallmarked by a rapid call to action. Risk assessment and cost benefit analysis to guide market strategy are essentially just afterthoughts in China. Arriving first to the party often seems far more important than arriving late but being well dressed. Fortune favors the brave but at the same time the road to sucess is littered with the broken remains of many an amibitious China market entry dream. On that note im gonna leave you today with a video of me bringing a bit of Irish training style to Chinese gyms..

The China Gym with Paul O'Brien:

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