Nutritional Supplement Industry on the Rise In Face of U. S. Economic Slump

by Christine Hronec


In an article by TIME magazine, it was quoted that as of late 2010, 93% of consumers had changed their grocery-shopping habits because of the economic downturn [1]. As the assumption that higher price means higher quality fades, consumers are turning away from national brands. Consumers now have first-hand experience that store brands taste and perform just as good as the big-name brands. Private labeled products are now present in nearly every shopping category from food and supplements to even entire clothing lines. This opens new opportunities for emerging private labeled brands to gain a portion of the market share in their respective category.

One category attracting the attention of Wall Street investors is the nutritional supplement industry [2]. While the overall U. S. economy is growing at a feeble 2 percent, niche markets with the vitamin and supplement industry are literally on fire with some reaching double digit growth. Right now there are no specific brands with a dominating position in this industry making it somewhat of a “wild-west” for investors. Each time a new company comes along with a new product or approach, market share is up for grabs by the fistful.

Examples of the demonstrated growth of this industry are best demonstrated by the overall stock performance of some popular supplement stores and distributors in the United States. Pittsburgh-based GNC Holdings Inc. (GNC), carries its own product line of vitamins, minerals, diet products, and sports nutrition products under various brands. In addition to these brands, GNC carries a variety of third party brands both in store and through e-commerce. Over the last two years both GNC and Vitamin Shoppe (a competitive specialty retailer of various nutritional supplements with over 500 stores) stock has shown double digit growth (see Figure 1.) as displayed in the 2 year chart of this stock’s performance on the NYSE compared to the S&P 500 [3].

GNC

Figure 1. GNC Holdings Inc. vs. Vitamin Shoppe NYSE 2 Year Performance To Date (compared to the S&P 500 in red)

The overwhelming growth of this product category combined with the markets demand for private labeled goods makes it a no brainer for those seeking to profit from these market trends. Starting a supplement brand is a straightforward approach for anyone from gym owners, personal trainers, doctors’ offices, bariatric facilities, med spa’s, and entrepreneurs to not ask, but take a piece of the pie. For more information on private labeling nutritional supplements, contact Muscle Gauge Nutrition (www.privatelabelmgn.com) for more information on how to get started today.

[1] http://business.time.com/2012/11/01/brand-names-just-dont-mean-as-much-anymore/
[2] http://seekingalpha.com/article/719941-why-investors-should-be-looking-at-nutritional-supplement-stocks
[3] http://finance.yahoo.com/q/bc?t=2y&s=GNC&l=on&z=l&q=l&c=VSI&ql=1&c=%5EGSPC

Want to learn more? - Contact Us Today

The new Leader in Fitness Supplements has arrived - Browse our product catalogue