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NGS Continue North American Expansion

31 May 2023 12:33

Nutritional Growth Solution’s North American expansion strategy continues to pay dividends, with the Company’s children nutrition products now being stocked in 465 Walmart stores.

The update comes on the back of a significant strategic restructuring to reduce Selling, General and Administrative (“SG&A”) expenses by approximately US$1.9 million dollars with the aim of aiding its expansion into North America.

Growing Growth Solutions

Alongside the growth in stores stocking NGS’ flagship product, sales velocity continues to exceed the Company’s expectations, hitting at an average sales velocity of 1.15, exceeding the 0.5 expected by the Walmart category buyer.

NGS’s products first hit Walmart shelves in September of last year and appear to be resonating with customers, with its Grow Daily 3+ Pediatric Shake Mix Powder Pouches holding an average rating of 4.8 stars based on 115 reviews on the official Walmart website, with the Company announcing in December that online sales were doubling month to month since launch in late September.

This continued sales momentum lead to NGS and Walmart growing their partnership twice in under four months, with Walmart moving to increase the number of stores holding NGS products in March and securing a range of NGS’ latest Happy Tummies product line in its stores in January.

And for NGS, this is only the beginning of the partnership, with the Company now working to deliver further store increases and higher sales.

Expand Growth Horizons

However, Walmart is not the only avenue NGS is taking into the North American market, with the Company also announcing it has begun onboarding two new retailers, iHerb and CVS Pharmacy-owned alternative formats, which are set to deliver further revenue and assist in further expansion into North America and globally.

Servicing over 10 million customers across 180 countries, e-commerce platform iHerb is set to begin sales of NGS’ entire Healthy Heights® line next month, with an initial order of US$10,000 and an annualised potential for over US$1,000,000 or more in sales.

CVS pharmacy-owned tailored offering stores will also begin stocking 2 items from the Healthy Heights® line in quarter one of next year, with the final store count, banners and locations still to be determined, with the Company’s products to be part of a multi-brand, combined “Power Wing” display, aimed to drive awareness and focus on children’s nutrition.

Looking Forward

The Company said it expects having NGS products stocked on iHerb will further build brand awareness, which is expected to result in a positive flow on effect to the Company’s Amazon business and the NGS website.

“Although the initial order is expected to be approximately US$10,000, the agreement with iHerb incorporates performance bonuses designed to drive growth and increase annual sales targets, and we expect this sales channel to significantly contribute to NGS revenue,” Chief Executive Stephen Turner said.

“NGS continues discussions with leading retailers across the United States, and we expect to see further expansion of the Healthy Heights brand as additional stores seek to leverage off Walmart’s sales success.”

NGS’ Australian Stock Exchange-listed share price has risen 7.69 per cent today, currently selling at 1.4c (12.31 pm UTC+8 hours).

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