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Naturade Total Soy, the #1 Naturade brand, was slumping at Sam’s Club, its #1 customer, after the new Slim Fast intro, and in certain danger of being discontinued; the company, the pioneer in natural protein powders, couldn’t survive losing this account.
Herbalife was the world leader in meal replacement shakes, but there was no written plan to grow the $1.5B retail food category. Its market-leading brand, Formula 1 Shake, had morphed into 365 SKUs and over 100 formulas with inconsistent nutritional specifications from country to country.
Naturade learned in May that Costco would not repeat its annual $1 Million 1st quarter weight loss promotion. Loss of this profitable in & out business would have major impact on the company’s year-end cash flow.
Naturade was the 80 year-old pioneer in Protein Powders. They sold their natural products exclusively through health foods stores. The new private equity owners wanted rapid growth via expansion into food/ drug/ mass without jeopardizing natural channel sales.