Vitamins: NBTY

CHRISTINA VEIDERS

NBTY HAS BUILT ITS reputation with retailers by staying true to its mission: Deliver the highest-quality nutritional supplements with the best value.

When it comes to vitamins sold at retail and within other distribution channels, NBTY is all pervasive.

The company markets numerous brands such as Nature's Bounty, Solgar, Rexall, Puritan's Pride and Sundown Naturals through different channels of trade. It's also a major supplier of store brands, having acquired Leiner Health Products in 2008.

“The idea is to have different brands for each channel and sub-brands in stores,” said Gary Giblen, executive vice president, Quint Miller & Co., New York.

But it is the Nature's Bounty brand, considered NBTY's signature brand, that retailers who voted in SN's category excellence survey mentioned most for its high brand-name recognition among consumers. Nature's Bounty is in 100,000 doors nationwide.

“Nature Bounty is the lead brand in mass market and supermarkets, and we continue to be very promotional and do heavy advertising. Consumers are asking for our product. We have upgraded our labels and packaging, and the products look better on shelves than the competition,” Harvey Kamil, NBTY president and chief financial officer, told SN.

NBTY has won numerous awards from retailers like CVS and Sam's Club for delivering the right product, on time and at competitive prices.

“They have the most reliable delivery, lowest prices and most consistent product quality. They are category captains to many retail chains. Because of that, they are the preferred player for shelf space,” noted Giblen.

NBTY considers its vertical integration a big advantage especially when it comes to quality assurance and control. Its large manufacturing operation supplies four channels of distribution — direct response/e-commerce, European retail and North American retail and wholesale. This multi-distribution system gives NBTY speed-to-market advantage and diversification of products.

Through its Vitamin World stores and direct response/e-commerce channel, valuable consumer sales data is generated and vitamin trends are shared with its retail customers. The Vitamin World stores are used as a laboratory for new ideas and are an effective tool in determining and monitoring consumer preferences.

The company has been very promotional minded with its retailers. “We do everything from a promotional standpoint,” said Kamil, “from BOGO, coupons, circulars and working with retailers to make sure retailers move products and customers get the products at great pricing.”

NBTY applies “new science” about vitamins to reformulate products. In response to health reports that many Americans may be vitamin D deficient, NBTY came out with vitamin D in 1,000 International Units.

Quality of product distinguishes NBTY in the supplement category. “Our tablets are smaller than the competition, always coated and easy to swallow,” said Kamil.

The global nutritional supplement manufacturer has gone from a public to a private company with the Carlyle Group acquiring NBTY for $3.8 billion.

Kamil said he doesn't anticipate any change as a result of the acquisition. “Carlyle is one of largest private equity firms in country. They like the category. They are excited to be partners with us and they will help us expand our international markets.”

Giblen wonders if NBTY can continue to hold its low price line under private equity ownership.