From probiotics to protein powders, veggie capsules to CBD oil, nutraceutical products are exploding in popularity – and companies are scrambling to fill open positions. Fueled by strong demand from health-conscious and wellness-savvy consumers, the industry is expected to be worth more than $578 billion by 2025.
‘Nutraceutical’ is a term coined in the 1980s to describe food products with medicinal benefit. This sector is where food, medicine and technology converge and broadly encompasses four major product types: functional foods, nutritional supplements, sports drinks and medically formulated foods.
The massive market potential is attracting major food and beverage companies and pharmaceutical companies into a space once dominated by entrepreneurs and smaller, mom-and-pop businesses. Here’s your cheat sheet to hiring talent for this rapidly transforming industry
Big Food is acquiring smaller companies, but not all employees are happy.
For international food conglomerates like Nestle, the nutraceutical industry represents an attractive diversification opportunity. Major food and pharmaceutical companies have a natural competitive advantage: they’re experts at large-scale manufacturing and global logistics that reach mass markets. Compared with pharmaceuticals, functional foods have a lower R&D cost and fewer–if any–regulatory approval hurdles. From a financial standpoint, acquiring smaller nutraceutical companies is smart business, especially if the parent company can scale its new acquisition quickly.
But when large conglomerates swallow up smaller mom-and-pop businesses, the integration process can be challenging. Big food companies don’t have the same agile, entrepreneurial mindset or R&D expertise. Employees at smaller companies are more likely to be passionate about nutrition and value their independence. They may resist becoming part of a larger corporate environment, especially at corporations that minimize the R&D or resist swift process and manufacturing changes on the floor. This can create talent retention challenges.
Nutraceutical skill sets are not always transferable.
Everyone from big market players to smaller startups are searching for manufacturing, operations, and R&D talent. Since ‘nutraceutical’ is a large umbrella term, experience with one type of product is not always transferrable to another, posing a recruitment challenge. For example, an operations manager who oversees pressed super food tablet production may know little about vitamin, gummy vitamin or powdered supplements. The formulations, shelf life requirements, and the machinery used in production are different. Because of this, operations positions are the most difficult to fill.
Exacerbating this challenge is the fact that many CEOs or Vice Presidents do not have a technical background. Consequently, they’re counting on their operations hire to not only manage day-to-day operations, but also be the primary knowledge source for all operation-related decision-making, educating the executive leadership team as they go.
Expect the talent search process to take months, not weeks.
Recently, I placed a Vice President for R&D at a company getting certified for 21 CFR 111 (current good manufacturing practice in manufacturing, packaging, labeling or holding operations for dietary supplements). Finding this professional was a true “needle in the haystack” search. Not only did I need someone with the right technical expertise and certification background, but this person also needed the right leadership qualities and people skills. Filling open positions like this is not impossible, but it does take time. Companies need to separate “must-haves” from “nice-to-haves” and expect the recruitment process to last three to four months, rather than three to four weeks.
Employer brand matters.
Companies, especially larger ones, need to consider their market reputation when hiring. For example, I recently filled a director-level operations position at a nutraceuticals company that manufactures vitamins. The company wanted to bring in a superstar to build up this new business line and assumed potential hires would be excited about the opportunity to grow a division from the ground up. I cautioned them to consider the opposite: prospective hires would also be concerned about leadership buy-in and organizational support.
For prospective hires, there’s a fear that promises won’t match reality, and that company leadership may not truly understand what it takes to build a new business line in a different industry. Candidates for the operations role expressed concern for continued division funding and the feasibility of the company’s aggressive growth plans. Several candidates shared their past experiences working on smaller product lines at larger organizations, detailing how these companies ended up slashing R&D and operations budgets. These candidates didn’t want to relive this experience and were reluctant to consider this position.
This is where a strong employer brand can make the difference. If you have a reputation as a company committed to innovation and development, you will have a much easier time landing your top choice hire.
Recruiting manufacturing, operations and technical (R&D and quality management) talent for the nutraceutical industry is a very unique process. It’s part food & beverage, part pharmaceutical, and part entrepreneurial. The right candidate must have a combination of hard skills, experience, leadership capabilities and a strong passion for functional foods.
What challenges have you faced hiring talent for nutraceutical product lines? I invite you to share your experience in the comments below.