“But as for you Daniel, conceal these words, and seal up the book until the end time; Many will go back and forth, and knowledge will increase.” Daniel 12:4 2003–2005 Recent years hardly seem to qualify as history. Yet every year brings a multitude of surprises, disasters, discoveries, wars and hope. On March 23, 2003, the United States launched a preemptive attack against Saddam Hussein, the Butcher of Baghdad, in an elusive search for weapons of mass destruction in Iraq. A new disease called SARS afflicted countless Asian travelers, as well as our neighbors in Toronto. Atkin’s low-carb diet peaked as one in every 10 Americans lost weight with the widely promoted fad, though it turned out to be short-lived as Atkin’s declared bankruptcy in 2005. Finally, the entire world worked its way out of the shadows of international terrorism that had erupted on 9/11. At NOW, these three years were largely spent gearing up for the next great sales wave and future acquisitions, in order to keep up with public competitors’ growth. NOW installed a new Oracle ERP (Enterprise Resource Planning) system in June, 2002 and became internally divided about the benefits of a bigger and better system. The health food industry seemed to ‘discover’ NOW as we received a number of prominent awards including Manufacturer of the Year by one trade magazine in 2003. Vitamin consumption in the U.S. sunk to the low single digits as the Coral Calcium fad slowed and negative publicity on Vitamin E hurt sales of that category by up to 40%. And my father, Elwood, formally retired January 1, 2005, leaving the company in the hands of a very capable management team that he had molded over the previous decade. INDUSTRY CONSOLIDATION Every business student knows that it is a natural progression for growth industries to eventually mature and consolidate into fewer, larger and stronger competitors. Industries such as hardware stores, drug stores, book stores, toy stores and more have seen the number of independent businesses shrink in favor of large, usually public, consolidators and category-killers. These giant retailers and brand names are changing consumer shopping choices as more and more family businesses fail to survive the spiraling competitive landscape. At NOW, our first company acquisition in June, 2000 was a big one: Puresource (www.puresource.ca), Canada’s largest wholesaler with over 100 employees. Puresource had grown very quickly in only 10 years and had been NOW’s preferred importer to sell NOW products into Canada. Our part-time sales rep in Canada, Doug Finlay, was also a business real estate broker and he suggested this marriage and helped to make it happen. Puresource had a very successful sales and marketing team, but a weak financial side that caused the company to be sold. Our primary objectives for this purchase were to accelerate NOW product sales into Canada and to test the waters to see how profitable and practical distribution of third party brands to health food stores could be. Ten years after this acquisition, NOW has become one of the leading brands in Canada 2003-2005 93
