CEO Paul Sturman’s renewed sense of urgency has Nature’s Bounty propelling boldly into a rapid market.
Today, perhaps more than ever before, health is at the forefront of the minds of consumers. Whether you are among the 70 million-plus baby boomers or the 70 million-plus millennials, you are likely helping to drive the more than $4.2 trillion wellness industry.
This market segment, which includes everything from beauty products to preventative medicine, work-place wellness initiatives, and personal fitness, is also driving growth in the nutrition category and for the dietary supplements industry. It’s already a $40 billion industry in the US alone–with more than 170 million Americans reporting that they take supplements every day.
The internet, among other trends, have seen people increasingly seek out alterntive solutions to physical and emotional ailments, or products that simply make them feel better. “There’s been an on-going conversation around health and wellness,” Paul Sturman, president and CEO of Nature’s Bounty, told CEO Magazine in an exclusive interview. “Consumers are increasingly interested in living better and many are turning to self-care. Because they have easy access to information outside of traditional healthcare methods, through social media and blogs, it is easier to learn more about the choices available, including how nutrition can play an even more important role in their health.”
The Nature’s Bounty Co., is a New York-based global manufacturer, marketer, distributor, and retailer of vitamins, nutritional supplements, sports & active nutrition, and ethical beauty products. It has more than 4,000 colleagues worldwide, and offices in Canada, the United Kingdom, the Netherlands, Spain, South Africa, and New Zealand. The company’s portfolio, which includes nearly 20 brands, is distributed throughout North America and in more than 100 countries around the world.
Nature’s Bounty is the company’s flagship brand and makes dozens of letter vitamins and supplements, like Vitamin C, B12, and CoQ10, as part of its vitamins, minerals and health supplements portfolio, but may be most well known as the number one gummy vitamin provider in the market, with its Hair Skin and Nails product line. Its other trusted brands include Sundown, Osteo-BiFlex, Ester-C, and Solgar, long considered the gold standard in clean, non-GMO supplements. In addition to the dozens of VMHS offerings, Nature’s Bounty Co. has several highly recognized protein brands in the Sports and Active Nutrition space including Pure Protein, Body Fortress, and MetRx. It also has an organic beauty line, Dr. Organic, recently launched in the US, and a new line of refrigerated protein bars made with real whole food ingredients. In August, the company returned to China, taking part in Costco’s Shanghai debut and launching on Tmall.hk.
The company has nine manufacturing facilities in the US, located in Arizona, Florida, New Jersey, New York, and San Antonio, Texas. It has packaging facilities near its Long Island headquarters as well as distribution centers in Nevada, New York, and Pennsylvania. It also relies on a number of third party manufacturers, as far away as Europe, in order to meet the customer demand around the world.
Paul Sturman was named President and Chief Executive Officer in 2017 and immediately recognized that a change in culture was going to be a crucial first step in improving the company’s financial results. “It starts with the strategy and the necessity to define strategic imperatives, a vision of where you want to be,” he insisted. “This will help you make choices regarding what you want to do to get to your outcomes—and more importantly, to some degree, what you don’t want to do.”
A rapidly growing market
The personal health and nutrition industry is growing rapidly, driven by a number of factors including developing markets, higher incomes, busy lifestyles, and the growing number of chronic conditions. In fact, a number of estimates predict the dietary supplement market to grow to more than $200 billion by 2026. What’s also exciting about the sector is the level of innovation currently happening in the market—fueled by the development of entirely new products, whether it’s in segments like beauty or protein shakes and bars.
“The speed at which the market moves is much more rapid today than it’s ever been, but we have to remain disciplined,” Sturman highlighted. “We’re focusing on those products that are most relevant to the consumer, and growing the fastest, whether it’s probiotics, solutions for stress and anxiety, or better eating on the go. There are certain platforms that are still underserved in the market—sleep aids are a great example. Our goal is to develop products that make the biggest difference to the people who need them.”
Innovation is so important to the company that last year it launched an Incubator and New Ventures function in order to not lose sight of the opportunities in the market. It’s the first time the company has had a team devoted to pursuing projects outside the day-to-day priorities—and with the mandate, resources, and leadership sup- port to make them come to fruition.
This function is all the more important given the current competitive environment. The supplements industry is highly fragmented. With an ever expanding field of competitors, in which Nature’s Bounty are one of the larger players, the company recognizes that it must nurture and further differentiate its product range going forward. “We’ve been building brand value, whether through implementing new strategies or employing disciplined thinking to ensure that we have sustainable differentiated propositions,” Sturman highlighted. “We’re spending more money on things that are working and making sure that we’re pulling back on things that don’t. I always tell my colleagues that failure is expected. Learn from it, and make sure mistakes are very short and shallow, so that you come out of them quickly, and get better over time.”
Sturman believes the cultural shift at Nature’s Bounty since he took on the role of CEO has been crucial in fostering an environment in which employees feel they can provide input, the company can get the best out of its talent, and hierarchy and bureaucracy come second place to teamwork and good decision making.
To help demonstrate to the organization just how committed he was to this principle, under Sturman’s direction the Human Resources team held the first ever “Bounty Bootcamp” last March. They were intensive half-day sessions, for several hundred colleagues, designed to make them familiar and comfortable with these new cultural principles. The feedback was overwhelmingly positive and helped generate greater trust within the teams, who put in the hard work day in and day out.
Sturman also launched a policy of weekly lunches with colleagues across the organization, meeting hundreds of employees over a year. These informal meetings were about reinforcing open and transparent communication, and turned out to be some of the most informative conversations he’s had. “If you came to one of our meetings, it might be difficult for you to determine who the hierarchy of leadership is because we’re all just trying to get to the desired outcome,” Sturman insisted. “To accomplish this, we have to make sure we have a very open and transparent path to communication to provide an environment where disruptive thinking can thrive.”
The Nature’s Bounty Co. was purchased by Carlyle private equity in 2010 for $3.8 billion, turning the decades-old organization back into a private company. Then, in September 2018, the Manhattan-based global investment leader KKR purchased a controlling interest in the firm, with Carlyle retaining a minority stake in the company.
“In the faster-paced private environment, it’s really about confidence in making decisions, because we have to make them quicker, and really get behind them,” Sturman explained regarding the current business mentality at Nature’s Bounty. “The importance of having the right talent in the company, making sure we understand what capabilities we need to have to succeed in the marketplace, and ensuring that we fill any capability gaps that we have, is vitally important.”
On his own experience and leadership style, Sturman emphasized the need to listen and stay close to his employees to ensure both his and the company’s future success. “If you can get people focused on a common objective, fostering interdependence and shared goals, keeping the dialogue open and transparent, you can make a tremendous difference in a company’s revenue and EBITDA performance,” he insisted. “Our products are great, but I’d argue that most companies have great products these days. It’s really about how you lead and motivate people toward a common purpose that will dictate whether or not you have a culture of success and winning.”