NBTY Europe’s Holland & Barrett and GNC have pulled fast-growing sports nutrition brand USN - whose MD is an ex-buying director of Holland & Barrett.
NBTY Europe initiated a supplier review in May following the imposition of VAT at 20% on sports nutrition products in October last year.
The health retail group is reported to have asked its sports nutrition suppliers to present their best possible terms on the understanding it would be removing one of the top four brands.
USN claimed NBTY Europe’s demands would have made it “extremely difficult” to continue supplying the company.
“NBTY/Holland & Barrett appears immune to understanding our position, and so we have little choice other than to divert our energies and attention to retailers who prefer a more even-handed relationship to working with brands who attract consumers in droves,” said USN MD Jason Oakley.
He accused the company of failing to account for USN’s marketing activity, such as its sponsorship of the Bolton Arena, or its record on innovation and growth. He said the company had launched 23 new products so far this year and had grown sales by 45% to £25m in the year ending 28 February.
Before becoming MD of USN in 2007, Oakley spent 20 years working for Holland & Barrett.
NBTY said it had reviewed its offer after last year’s VAT changes to “give customers the best value and quality”.
“Although we have enjoyed an excellent working relationship with USN, we no longer feel its proposition supports the future direction of our business,” said group trading director Kyle Rowe.
The VAT hike has hit the category hard. In February, The Grocer reported that sales growth had slowed in grocery from 35% before the VAT rise to 7%.
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