Iconic weight loss and meal replacement brand, with #1 brand awareness in the weight loss category
SlimFast is an iconic weight loss and meal replacement brand with #1 brand awareness in the weight loss category. For over 40 years, SlimFast has helped millions of Americans take control of their diet, lose weight and keep it off. In addition to the flagship SlimFast brand, SlimFast/HNS (“SlimFast”) has a collection of brands including Healthy Delights, Nu-Therapy, Power Beets, and Teatopia that provide a variety of condition specific benefits ranging from weight management to sports nutrition, beauty and digestive health.
The Value Creation Opportunity
The Kainos team was introduced to Chris Tisi, founder of Heathy Natural Solutions (“HNS”), in 2013. Chris was looking for a partner to help him further develop his brands and scale his business. Chris Tisi had deep customer relationships in the supplements and weight loss category that were complementary to the Kainos network. While engaging with Chris to make an investment in HNS, Unilever made the decision to divest SlimFast. We quickly worked together with Chris to make an offer to Unilever and create a turnaround plan for SlimFast, which had declined from a peak of $850 million of sales in 2002 to $140 million in 2014 under Unilever’s ownership.
Our goal was to return the SlimFast brand to growth and profitability while leveraging a combined SlimFast/HNS platform to develop on-trend brands within the portfolio. Unilever valued the Kainos team’s industry knowledge and relationships in the health and wellness sector, and experience with brand turnarounds such as Vlasic Pickles and Hungry-Man. Kainos and Chris Tisi presented our vision for the SlimFast brand to Unilever and we were selected as their preferred partner. Both HNS and SlimFast were acquired contemporaneously in 2014.
Change Capital At Work
While HNS was a small emerging company with only 13 employees, SlimFast came with no employees and no systems. Kainos had a 12-month transition services agreement with Unilever to give us time to build out a full executive team, sales force and supporting organization both in the U.S. and in the United Kingdom.
Within months of acquiring SlimFast, we utilized our Kainos industry network and made over 40 new hires, including a CFO, VP Sales, VP Marketing, VP Supply Chain, a regional sales force, marketing and brand development support, and a 12-person team to run the SlimFast UK business. We also successfully implemented a new IT system and developed a third-party warehouse and distribution solution soon thereafter.
While working hand-in-hand with Chris to recruit a team, we also had to simultaneously reposition the SlimFast brand as “diet season” was quickly approaching – only months away. We worked daily with our key retail partners to reclaim the SlimFast heritage and make the brand relevant again. We started with the packaging and . . . the bottle. Together, management and Kainos developed a new bottle for the ready-to-drink, new packaging across the product range on the shelf, and new packaging formats and kit sizes for retailers selling the 3-2-1 plan. We also began to leverage the library of clinical studies to make product claims on the packaging and bottle such as “Up to 4 Hours Hunger Control” and “Clinically Proven.”
As we were working on the brand relaunch, we were also working on innovation. It was critical that we expand the product offering as there had been very little new product development prior to our ownership. Working with our innovation team, we launched 15 new SKUs in 2016, including high protein shakes and powders, upgraded meal bars, and 100-calorie snacks, leading to new SKUs at a number of different retail partners including Walmart, Kroger, and Meijer with a total of 135,000 new product facings on the shelf. In 2018, we launched a SlimFast RTD coffee beverage, SlimCafe, which took the SlimFast brand to a whole new section of the store – the beverage aisle.
With SlimFast on a successful growth trajectory, we needed to improve margins and return the brand to profitability. Working with the SlimFast team, we aggressively bid out all key outsourced manufacturing contracts we assumed from Unilever. Upon completion of this extensive process, we were able to garner significant savings in manufacturing, supply chain and distribution.
This successful partnership with Chris Tisi and his team has allowed Kainos to bring SlimFast back to the forefront of the weight management category. For the last three years, our efforts have made SlimFast the fastest growing brand in the diet category. We are proud to have reinvigorated an iconic brand that provides consumers with a variety of great tasting products that allow them to live healthier lives.
After returning SlimFast to profitability and becoming the fastest growing brand in its category during our partnership, we sold the business in 2018 to Glanbia Plc, a global nutrition group headquartered in Ireland.Back