Nutrabolt: a supply chain fit for rapid growth
“It’s easy to get very passionate about helping people with health and wellness,” says Casey Bauer, Chief Operating Officer at Nutrabolt.
A sports nutrition enthusiast and long-time fitness hobbyist, Bauer oversees operations including supply chain, product development, quality and IT, promoted to COO in December 2016 having arrived as SVP of Supply Chain in August of the previous year.
The maturation of Nutrabolt’s supply chain during this time has allowed it to cement its position as a leading sports nutrition company in the USA, providing a foundation to roll out new product ranges aimed at varying audiences looking for products to achieve their sport nutrition goals. For Bauer, having driven the transformation of Pharmavite’s supply chain, the opportunity to take on a new challenge – one that is so heavily dependent on partnership networks – was too enticing to turn down.
“I uprooted my family who loved the Southern California sun and took them to rural Texas, so hopefully they still love me for doing that to them!” he laughs. “Jokes aside, it has been a great transition, actually. We really enjoy it out here and the team at Nutrabolt has been amazing.”
The move into sports nutrition was an added bonus. Asked if this was a career he had always sought out, Bauer replies: “It wasn’t a natural career choice for me. I became interested in this space when travelling during my consultancy work, which involved living out of a suitcase and using hotel gyms.
“I hadn’t worked with these sports nutrition products before but had been exposed to them and been a consumer, which adds an extra element of excitement. We also have a beautiful state of the art gym on-site, which is stocked with all of our products, so we are consumers and users too.”
Bauer arrived at a company in the middle of a growth spirt. Formed in 2002, the business was set up to help smaller supplement shops source affordable products, leading to the formation of the brand Cellucor. This remains the most important and successful Nutrabolt range, comprising industry leading products for pre- and post-workout, amino acids, protein, weight loss and testosterone.
Current CEO Doss Cunningham arrived in 2004 as a part time accountant, buying out one of the two founding partners in 2007 before lifelong friend Manish Patel and he partnered to acquire the remainder of the business in 2008. It was from here the business began to increase revenues above the $10 million mark, the pre-workout market in particular helping it to become more profitable. In 2014, MidOcean Partners invested in a minority share and have proven invaluable in providing leadership and driving more aggressive growth. Bauer arrived shortly after.
“The interesting thing for me is that the retailers across the USA are coming to us to increase distribution, such is the demand for the products,” he says. “We don’t have to knock down the doors, they are already open. We have added several brands to the portfolio, including FitJoy protein bars last year, which has now put us in the quarter billion-dollar range. We have also just completed our acquisition of the Scivation brand which gives us market leadership in Branch Chain Amino Acids as well.”
Nutrabolt’s other brand is Royal Sport LTD, a six-product sports nutrition brand available only at GNC franchise stores.
While it was certainly an exciting time for Bauer to arrive in August 2015, he recognised the relentlessness of the growth would not be sustainable without a solid structure. “What I saw was a supply chain that was pretty frantic. Everyone was super focused on how do I get tomorrow’s order out of the door, so there was nobody with the luxury of taking a step back and observing.
“I walked into Doss’s office and said it’s crazy down there, and that I needed 60 days to come up with a strategy. He gave me that luxury and the team and I sat down and came up with a supply chain strategy for the first time in the company’s history.”
The 60-day evaluation told Bauer and his team two things: that Nutrabolt needed to be smarter at supply chain planning and continue to drive cost optimisation. The following 12-18 months saw the plan put into action and has seen some phenomenal results, not least when looking at inventory figures.
While inventory rates have been cut in half, fill rates have risen from 76 to a little over 96 percent in the latest month. “That is my favourite statistic,” Bauer adds. “When I first came in there was a very strange dynamic. I got a call from our President saying inventory turns are below two, and then had about 10 calls from sales leads saying they didn’t have the product to fill customer orders. This didn’t make any sense, and goes to the heart of the supply chain planning.”
In Bauer’s words, it was time to “stem the bleeding”. Investing in the supply chain planning software solution Logility has proven to really help stabilize Nutrabolt’s supply chain, despite Bauer’s trepidation at recommending such a significant investment so early into his tenure.
“I think the willingness to change was what I was most worried about before going into this,” he continues. “I pitched this only three months into being employed and was scared to death at the prospect – I was walking in as the new guy advocating a very expensive piece of software.
“But Doss was so supportive and we got on the phone to the MidOcean folks and they supported the idea straight away. My team on the demand planning and supply planning side were also super excited, especially having lived the pain. The willingness to change was emphatic, it has been a huge learning curve.”
Strength in suppliers
The effectiveness of Logility becomes even greater as key partners look into adopting the solution. Indeed, the smooth functioning of the Nutrabolt machine is dependent on collaboration with third parties, from freight companies and 3PLs to manufacturers and even their suppliers.
“This makes integration and partnership absolutely critical to any success,” adds Bauer. “The inventory improvements we talked about would never have been possible without collaboration with our partners. It is about transparency and closeness.”
Such close relations with production partners is especially critical given the move to turnkey manufacturing, which means Nutrabolt simply purchases finished products and holds no component inventory. Bauer points to a partnership with Genysis Brand Solutions as a case in point.
“We have monthly meetings that switch between our location in Texas and their location in Utah,” Bauer continues. “We make sure we meet face to face to add to our daily conversations. We have scorecards and metrics, talk about what’s working well and what’s not working well, and discuss how we can become more integrated and gain greater visibility.
“There was a time when we would be afraid to give a partner company too much data – now I’m pushing to give them more. I appreciate massively the transparency that exists between ourselves and the Genysis team, and we are now at a point where we are realising joint cost savings. We have even been able to cut lead times in half on key products and get products to customers significantly faster – this is because they have that visibility and are benefiting from the collaboration on the forecasts.”
Moving forward in 2017 and beyond, integration of the end-to-end supply chain will become a major priority. Bauer’s ideal state is one where all manufacturers and partners, and even their suppliers, can access central portals, offering 100 percent visibility and tying the whole supply chain together. He is also looking to add to Nutrabolt’s international supplier network, a move which will localise production and decrease shipping costs. Further still, the COO is targeting redundancy in the supply chain, mitigating risk in single source supplies.
“Innovation is another area we want to continue working with the likes of Genysis on, getting them into the process earlier to tap their wealth of expertise,” Bauer adds. “These are the people working with the key materials day in and day out.”
New channels, happy customers
As product formulas evolve, so do the channels in which Nutrabolt sells through. Although specialist retailers remain the company’s largest segment of business, some of the country’s retail giants are opening doors to orders en masse.
“Amazon has been a tremendous partner for us and we’ve had an amazing growth trajectory,” Bauer says. “We’ve just added Justin Jackson to our team, who is our SVP of Consumer Direct, overseeing our personal websites and the Amazon account. He is a former Amazon executive and has brought some massive improvements to the company.”
Indeed, Bauer is convinced that Nutrabolt can help to mature the product ranges seen in the likes of Walmart and other large supermarkets. “You see a lot of protein but not a lot else, so our C4 Sport line has been hugely successful in filling these spaces. Now we’ve started expanding our offering and the advent of FitJoy has allowed us to create a functional foods brand, which is specialty focused now can have reaches into other consumers, which is exciting.”
Different buyers bring with them different supply chain nuances, and Bauer points out some of the challenges associated with this diversification. For instance, selling through Amazon has demanded a whole new stickering process, while precision has become even more of a must with delivery schedules.
Bauer explains: “When you sell into the likes of Walmart you are dealing with extremely lean supply chains so it is vital to have consistency of demand. You can get fined by Walmart if you ship a product early – they don’t want extra inventory on their books, nor do they want to run out. This means we have to add an extra layer of sophistication to our supply chain.”
Challenges granted, expansion into new sales channels has opened up access to Nutrabolt’s product ranges to a far greater demographic across the USA. And having reached out to a wider audience of fitness enthusiasts, it is vital to convert as many of them as possible into repeat customers. Central to this is meaningful engagement.
“If you pick up one of our products it has a 1-800 number on the label,” says Bauer. “If you call that number you’re not routed to a call centre somewhere else, you are sent trough to a group of Nutrabolt folks we have downstairs who will answer questions and send handwritten notes back to the consumer.
“We had one recently, which was the first problem we’ve had on direct to consumer for a long time, where two products went to the wrong people. Our warehouse immediately got on it and dispatched the right products, and one of the customers even got the replacement and heard from us before they got home to see that they had been sent the wrong order. We really believe in that close connection and doing right by our customers.”
Bauer’s ambitions will not be realised without a fully motivated and energised supply chain team, something which has evidently come to the fore over recent months and is ultimately leading to high levels of customer satisfaction.
“Compared to the company as a whole, the supply chain group was in the lower half of the spectrum when it came to employee engagement,” he explains. “Part of that was because we were asked to almost do the impossible given how tremendous the growth was – people were scrambling to get products out of the door.”
However, thanks to the installation of aforementioned new processes and systems, the supply chain group is a much happier place to be and will continue to expertly to serve colleagues and customers. “A lot of our improvements in this respect have fed back into employee happiness and engagement,” Bauer continues, “but there have been some simpler things like recognition which has helped greatly.
“For a supply chain person, the best compliment you can receive is from a sales team ringing you up and saying good job, thanks for getting my order fulfilled.”