A NEW DIVISION – HEALTHCO INTERNATIONAL In 1991, Elwood had the idea of starting a related company that would supply small competitors with our raw materials and help leverage our purchasing and increased production. NOW had sold to some companies, such as Solaray, niche ingredients that they were unable to find elsewhere. But when NOW became a larger competitor, branded companies didn’t want to buy from us because we were a feared competitor with too-low pricing. Our aim in starting HealthCo was to sell to these same type of accounts, while hiding behind a separate identity. Initially, HealthCo was run by Shirley Kollenburger, a veteran health food manager who had owned her own store in Lisle, IL previously. She also happened to have been my first boss at The Fruitful Yield health food store in Elmhurst, IL in 1979. Shirley was a natural manager and saleswoman who initiated new business and serviced customers quite well. By the end of 1991, HealthCo’s first year, sales hit $149,000 and the new venture was off and running. In 1993, David Richard left the Glendale Heights Fruitful Yield store and became co-manager of HealthCo, initially sourcing raw materials direct internationally. David helped obtain New Zealand Shark Cartilage direct, when the market was oversold and short on supply. He later found a connection in England that helped to import panax ginseng, siberian eleuthero herb, royal jelly, bee pollen and propolis direct from China. Then he found direct sources for French green clay and Moroccan red clay powders. David was also instrumental in lowering costs of products such as evening primrose oil by sourcing the imported seeds directly and then negotiating contract processing runs. These purchases were done under the HealthCo umbrella in an effort to truly make HealthCo international. These deals also provided salespeople with lower costs that beat the market prices on each of the items noted. Prior to one purchase, David had one lot of Propolis tested for heavy metals and found out that lead was quite a problem. He brought this up to the Bee Products Association, an industry trade group, and apparently no other company had been testing for this. Within a short time, most other brands of Propolis had to issue a formal recall due to lead contamination, but NOW’s propolis was safe from all heavy metals. In 1994, HealthCo Brokerage was launched as an attempt to broker sales direct from farmers and growers to retail health food stores. David hooked up with companies such as Aloe Farms, Zumbro, Aspen, Nutri-Pak, RyVital, Vitality Works, and Indian Wells, who would bypass traditional distributors and ship directly to retailers at discount prices. This did create some conflict within NOW, as we found ourselves competing internally for the same wholesale dollar, from the same customer base. The major problem with phone brokerage was that no major brands would switch services to HealthCo, since no representatives were actually selling inside stores. Our plan was to operate as telemarketers at a reduced fee for manufacturers, but that never seemed to take hold and the entire brokerage division was discontinued within a few years. 1989-1992 69
