GNC (store)
GNC (store)
Type | Public |
---|---|
Traded as | NYSE: GNC [27] (Class A) Russell 2000 Component |
Industry | Retail |
Founded | 1935 Registered: 9/1/1936 |
Founder | David Shakarian |
Headquarters | Pittsburgh, Pennsylvania, United States |
Number of locations | 4,691 (U.S. & Canada, 2016) 1,957 (International, 2016) |
Key people | Ken Martindale (CEO) Tricia K. Tolivar (CFO) |
Products | Nutritional supplements |
Revenue | US$ 2.54 billion (2016) |
Operating income | US$ -172.95 million (2016) |
Net income | US$ -286.25 million (2016) |
Total assets | US$ 2.07 billion (2016) |
Total equity | US$ -95.05 million (2016) |
Number of employees | ~16,800 (2016) |
Website | www.gnc.com [28] |
Footnotes / references [1][2] |
GNC Holdings Inc. (General Nutrition Centers) is a Pittsburgh, Pennsylvania-based American company selling health and nutrition related products, including vitamins, supplements, minerals, herbs, sports nutrition, diet, and energy products.
Type | Public |
---|---|
Traded as | NYSE: GNC [27] (Class A) Russell 2000 Component |
Industry | Retail |
Founded | 1935 Registered: 9/1/1936 |
Founder | David Shakarian |
Headquarters | Pittsburgh, Pennsylvania, United States |
Number of locations | 4,691 (U.S. & Canada, 2016) 1,957 (International, 2016) |
Key people | Ken Martindale (CEO) Tricia K. Tolivar (CFO) |
Products | Nutritional supplements |
Revenue | US$ 2.54 billion (2016) |
Operating income | US$ -172.95 million (2016) |
Net income | US$ -286.25 million (2016) |
Total assets | US$ 2.07 billion (2016) |
Total equity | US$ -95.05 million (2016) |
Number of employees | ~16,800 (2016) |
Website | www.gnc.com [28] |
Footnotes / references [1][2] |
History
A GNC store at Promenade
In 1935, David Shakarian opened a small health food store, Lackzoom, in downtown Pittsburgh. He made US$35 on his first day[3] and was able to open a second store within six months. A year later, Shakarian suffered from what appeared to be a fatal blow when the Ohio River flooded into downtown on St. Patrick's Day. Both of his stores were wiped out. However, he quickly rebuilt both stores, and opened five more by 1941. The company officially registered as a corporation on September 1, 1936 Shakarian moved into the mail order business during WWII. He said that customers sent him a check and asked him to mail their product as they could not drive to his store due to the gas rationing which happened during WWII. During the health food craze of the 1960s, Shakarian expanded his chain outside Pittsburgh for the first time, and in the process changed its name to General Nutrition Center. He continued to run the chain until his death in 1984. Shakarian took GNC public (listed on the NYSE) in the 1980s. Overexpansion and his death in 1984 resulted in a highly leveraged GNC. The Shakarian family decided to sell GNC shortly after his death. The family brought in a "turn around" executive, Jerry Horn, with instructions to "stop the bleeding" and position GNC to be sold.
In 1990 the company considered relocating but a public/private effort retained GNC headquarters in Downtown Pittsburgh.[4] GNC was taken private and sold to The Thomas Lee Company, a PE investment/management fund in the late 1980s. Thomas Lee ran GNC and took it public prior to selling the company to Royal Dutch Numico and Numico acquired GNC in 1999;[5] it sold GNC to Apollo Management in 2003.[6] Ontario Teachers' Pension Plan and Ares Management bought GNC in 2007.[7] GNC went public in 2011.[8]
In 2018, Harbin Pharmaceutical Group Holding Co., a company controlled by the Chinese government, agreed to acquire an approximately 40% stake in GNC.[9]
Retail stores
GNC store, Ypsilanti Twp., MI
GNC stores typically stock a wide range of weight loss, bodybuilding, nutritional supplements, vitamins, natural remedies, and health and beauty products, in both its owned brands as well as third-party brands. The stores also sell health and fitness books and magazines.
GNC has more than 6,000 stores in the U.S., including 1,100 store-within-a-store locations within Rite Aid, as well as locations in 49 other countries. In addition, GNC LiveWell currently has 41 Stores located in Brisbane, Sydney, and Melbourne in Australia.
In July 2019, it was announced that GNC plans to close up to 900 retail locations, primarily those located within shopping malls.[10]
Business model
GNC retail stores are a combination of corporate-owned and franchised stores; 950 of the 5,000 domestic US stores are franchises, commonly located within urban shopping malls and shopping zones. In addition to the GNC.com website, GNC's products are sold on drugstore.com, as well as amazon.com.
Lawsuits
In 1998, GNC was accused of purposely running its franchisees out of business in order to "retake" the stores into corporate control.[11] An April 30, 2003 article states that the GNC corporate company was sued by numerous franchise owners.[12] The complaint is that the parent company was allowing their corporate owned stores to sell products for less than the franchise stores are allowed to sell them for. The suit also claimed that GNC charged high "reset fees" to franchisees when there is new signage that needs to be changed in the store or an image facelift that must be done by GNC corporate. A similar lawsuit was filed again in an article written on October 20, 2004.[13]
In February 2015, New York Attorney General Eric Schneiderman sent cease and desist letters to GNC and other major retailers due to concerning laboratory tests regarding the accuracy of the claimed contents of supplements.[14][15] GNC shortly afterwards removed some stock from sales while working with the Attorney General.[16][17] In September 2016, GNC, the New York Office of the Attorney General, and other supplement retailers ultimately came to an agreement and retailers are now accomplishing more robust testing of supplements to ensure accurate labeling.[18][19]
On February 2, 2017, GNC threatened to sue the Fox Broadcasting Company for "significant economic and reputational damages, lost opportunities, and consequential damages", after an advertisement for the chain was blocked from airing during Super Bowl LI. Despite repeated approvals by Fox, the network stated that the ad had been vetoed by the National Football League because of GNC's placement on an NFLPA blacklist for selling products that contain substances banned by the NFL. The letter of intent claimed that Fox had not informed them of any such rules when they purchased the ad time, and cited that the purchase induced them to "spend millions of dollars in production costs and in the development of a national, coordinated marketing and rebranding campaign" around the commercial. The NFL itself does not prohibit ads for health stores unless they contain references to specific prohibited products; the GNC ad only contained motivational themes and no references to its products.[23][24][25]