Asiatic Sourcing Blog

Buyout of US Vitamin Maker Increases Confidence in China Products

The 2010 Chinese buyout of International Vitamin Corp (IVC) based in New Jersey has given promise to further such deals in the future. Since being acquired by Aland Nutraceutical Group, a privately owned pharmaceutical firm in the Jiangsu province of China, IVC has expanded its work force and received an award for its economic contribution in the state.

Kim Guadagno, New Jersey Lieutenant Governor, toured the IVC factory in December and praised it for taking a leadership role in the vitamin and health supplement industry. She stated that IVC reflected the reputation of New Jersey being the best state in which to conduct research in life sciences and a go-to state for cutting edge manufacturing.

The China-IVC connection is also seen as a positive step in providing New Jersey citizens with greater job opportunities. The company has expanded in the past two years since being acquired by its Chinese buyer, creating an additional 130 positions for the state’s highly skilled and well educated workforce.

Although the vitamins and supplements are manufactured in the US, China manufacturing plants are utilized for supplying the specially mixed chemical ingredients that are used in them. These powders are imported from China to IVC’s manufacturing plant in New Jersey.

The buyout has increased IVC’s ranking in the US vitamin and supplement industry to second place from its previous fifth place position. This is due to the improvement of production practices. The US Food and Drug Administration inspects both products and production facilities on a two week basis. Since being acquired by the Chinese, the company has not failed an inspection.

IVC’s stellar performance under their new owners is boosting confidence in the “Made in China” label and providing exciting hope for others considering a move towards doing business in China through China sourcing outlets.

Also, because of its success, IVC is in the process of creating a business template so that Chinese investors find it easier to transfer business and technology strategies in future acquisitions. IVC played a key role in this area due to the fact that their new Chinese owners had to move from a mindset of base production to that of supplying materials for products of higher value.

Steven Dai, the CEO of IVC, said that there were initial problems at the beginning of the acquisition, but most were in the area of communication, especially via phone conversations. However, he says that those misunderstandings were soon ironed out and the company is now very pleased with the new management.

Dai goes on to praise the support that the Chinese investors received from the New Jersey state government. He attributes such assistance as a driving factor in the company’s rapid growth.

Lieutenant Governor Guadagno relayed to the newspaper China Daily that New Jersey was increasing its efforts to welcome foreign investors. The state recently opened the Office of International Business Development and Protocol to assist with this effort.  

By providing more US opportunities for Chinese investors and with those companies producing high quality products, it is hoped that “buy from China” will take on a more positive meaning.

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