Vitamin Shoppe Slump Continues

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Secaucus, NJ — Continued price competition in the sports nutrition segment led to an 8.5% decline in third-quarter net sales for The Vitamin Shoppe. Same store brick-and-mortar sales were down 7% and online sales were down 5%, the company reported this week.

On a conference call with analysts, CEO Colin Watts attributed 80% of The Vitamin Shoppe’s decline in sales to the heavy promotional climate in the category. Hurricane impact on stores was also a factor. Total net sales in the third quarter were $288.2 million, 8.5% lower than the  $314.9 million from the same period last year. Three stores were added in the quarter.

On the bright side, Watts said the company’s new SPARK Auto Delivery program is running ahead of projections, and has attracted more than 200,000 subscribers in its first six weeks. The program offers a 10% discount, delivers paying rewards members a sample box four times per year, free shipping, flexible delivery and a wellness plan.

Full-year capital expenditures of $50 million include the build-out of Vitamin Shoppe’s distribution center in Arizona, about 15 new stores, 10-15 store transformations and expanding the Secaucus headquarters to support the closure of its North Bergen offices.

Vitamin Shoppe forecast a full-year comparable sales decline of negative 7%, which includes the impact from hurricanes. Gross profit of $86.1 million for the third quarter was 15.7% lower than $102.1 million in third quarter 2016.

On the other hand, competitor GNC recorded a 1.3% increase in corporate-owned same-store sales, transactions up for the third quarter in a row. GNC launched One New GNC in late December. 2016, which involved reduced prices and a new loyalty program.

Posted on WholeFoods Magazine Online, 11/10/17

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