An introduction to The UK Health Sector

HSM Credentials  Area of Expertise - Works specifically in the Health Channel  Cliff Moss – Has held a number of key industry positions including Consultant to some major Brand Owners, and was Managing Director of Green & Black’s  Turnover Responsibility - brands now represent a turnover of over £35m retail sales

Health Sector Credentials  A Brand Sales Management Company  Green & Black’s  Heath & Heather Tea  Rowse Honey  Cauldron Foods  LifeStream  Trilogy  Aqua Oleum  Toms of Maine  Since 1995 – currently employs a team of 15 people and has a close collaborative relationship with key industry figures

Channel Outline Health Food Trade

 Holland & Barrett  £280 million (approximately)  Independents  £250 million (approximately)  40% Food - 60% Non Food (Value)  No TNS or other sector data Market Size

 H & B Group is the major player in channel with  516 H & B stores  31 GNC Stores  69 De Tuinen  19 Natures Way (Irish Stores)  1100 independent stores but few other chains  1 Wholefoods Market, 5 Fresh & Wild  5 Planet Organic  Wyedean – 15 Stores  Independent market served by 18 main UK wholesalers (2 Irish wholesalers) Sector Summary

Wholesale Network

The Health Store Infinity Foods Community Foods Suma Wholefoods Rainbow Granary Essential Trading Good Food Distributors Goodness Foods Tree of Life Green City Highland Wholefoods Wholefoods Wholesale Juniper Marigold Lembas Munster Wholefoods Queenswood Health Food Wholesalers CLF Distribution

The Health Store Infinity Foods Community Foods Holland & Barrett GNC Suma Wholefoods Rainbow Granary Essential Trading Good Food Distributors Goodness Foods Tree of Life Green City Highland Wholefoods Wholefoods Wholesale Juniper Marigold Lembas Munster Wholefoods CLF Distribution Many wholesalers supply stores in other wholesalers ‘natural’ territories Queenswood Pitman Agencies Sales Coverage - Territory

The Health Store Infinity Foods Community Foods Suma Wholefoods Rainbow Granary Essential Trading Good Food Distributors Goodness Foods Tree of Life Green City Highland Wholefoods Wholefoods Wholesale Juniper Marigold Lembas Munster Wholefoods Queenswood Many Wholesalers Inter-trade CLF Distribution Pitman Agencies

 National – Tree of Life, The Health Store, CLF Distribution  Workers Co-operatives – Essential Trading, Infinity Foods, Suma, Green City, Highland, Lembas  Religious Based – Goodness Foods, Community Foods  Other Regional – Queenswood, Rainbow, Granary, Marigold, Good Food Distributors Wholesaler Categories

 Supplements and Food  Tree of Life  The Health Store  CLF Distribution  Marigold (some mainly natural) Food or Supplements?

Supplements or Food?  Foods  Community Foods  Queenswood  Rainbow  Granary  Marigold  Good Food Distributors  Foods  Essential Trading  Infinity Foods  Suma  Green City  Highland  Lembas  Goodness Foods

 Listing Fees – most now charge a listing fee for inclusion in price books  Promotional Activity – all wholesalers actively run promotional activity for which they charge  Magazines – some have own magazines to support products  Goody Bags – some will arrange sampling Wholesaler Cost of Entry

 Wholesaler Benefits  Instant access to shops though price books  One delivery point per wholesaler  One invoice point  More financially sound than some stores  Wholesaler Disadvantages  Loss of Margin – although most wholesalers discount  Loss of direct contact with stores  Sale or return Wholesalers or Shops Direct?

Holland & Barrett

One buyer – 566 stores!  Multiple of the Health Sector  High Margin Expectation compared to multiples  due to distribution and volume costs  Stock Trial – currently H & B look to the supplier for free of charge stock instead of listing fees!

One buyer – 566 stores!  Committed to listing 500 new products per year  Business split into 5 Zones for ranging  varies by category  Buyers only recommend products  Trading Meetings decide on Listings

Why Consider the Health Sector?

Health Sector benefits  Great place to start ! – many brands have started here – Green & Black’s, Jordans etc  Gives a brand Heritage and substance – selling in the Health Sector helps to maintain brand heritage  First for New Trends – many trends start here  Organic  Fairtrade  Free From  But…….  Difficult Transition for Multiple Based Brands

Brand Building

Brand Building in the Sector  Allow Time to Grow – its not instant sales like the multiples!  Be Innovative – new products not ‘me too’  PR – be active to drive customers to your products  Talk to the shop owners – direct salesforce activity is the key  Keep Promoting in Wholesalers – many independent stores buy products on deal!  Keep ahead of the market  Wholefood – Organic – Fairtrade – where next?

The Health Sector Products  Most Importantly Know your Consumer!

You May Just Get there!

The End Healthy Sales & Marketing Ridges Court Industrial Park Okehurst Lane Billingshurst West Sussex England