Gnc Holdings Essay

3390 Words Feb 2nd, 2013 14 Pages
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GNC Holdings, Inc. | Operations/Supply Chain Management Overview and Analysis | | | | | |

Executive Summary
Background:
GNC was founded by David Shakarian in 1960s, and specialized in yogurt and other healthy food such as honey, grains, and “healthy sandwiches”. Due to increasing demand, GNC expanded stores throughout the United States during the 1970s. However, the emergence of other competitors in the external environment and poor management internally lead to a difficult period of time for GNC during the 80s. After Jerry Horn took over as President and implemented major changes in 1985, GNC had a fresh start and continued to grow. GNC is now the largest global specialty retailer of nutritional products:
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Some GNC stores were too close to one another, and poorly-performing stores were harming the overall bottom line. The company was also plagued by lawsuits and complaints involving anything from false claims about vitamins to fiscal impropriety. In 1985, Jerry Horn took over as President and implemented major changes. He eliminated underperforming stores and set up a system to root out underperformers. He also eliminated thirty percent of GNC’s offerings and changed the layout and product mix of stores to better appeal to consumers. Nearly all items were repackaged and new products such as skin and hair care products were introduced. The company began appealing more to body-builders and serious athletes with over-the-counter weight-gain and energy supplements. Horn initiated communication with the FDA and targeted new advertising toward fitness-conscious consumers. He also initiated a franchise program, which increased sales and encouraged company growth. GNC continued to grow through the 1990s, adding over 2,000 stores. The company also experimented with new types of stores, such as the Live Well stores, which offered gourmet health food and upscale health and beauty products, while partnering with outside firms to develop new health products which it could sell exclusively in GNC stores. GNC

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