New Beginnings for an Old, Established Chain

Le Naturiste’s new owners Melanie Kau and Stephen Rosenhek plan to revitalize the company

BY CAROL CRENNA

PHOTOGRAPHY BY VADIM DANIEL

When natural health icon Jean-Marc Brunet launched Le Naturiste in 1968, his vision for the future may well have included the goals of the newest owners of the 80-store chain. The enthusiastic and enterprising Montreal-based entrepreneurs Melanie Kau and Stephen Rosenhek, who acquired the company last year, have big plans. Kau, who formerly worked within a family-owned furniture retail business, states, “Donald Trump said, ‘If you are going to be thinking anyway, think big.’ We had great careers before this venture, so if we we’re going to begin a new one, we want to make it fantastic, and have fun doing it.”

Le Naturiste has built strong brand recognition among health-conscious Quebecers; as the first retailer to offer easy access to natural products, it’s established as a “community destination.” The new owners aren’t about to compromise that.

What are key considerations for transforming the 44-year-old chain, while at the same time not alienating existing customers?

REBRANDING PLANS

Since the name has tremendous equity “as a personality,” it won’t change. Kau says, “Customers tell us, ‘We came here as children with our mother and now we bring our kids.’ But we will rebrand to appeal to a wider base of people. We want to continue along the lines of the company’s founder who had a vision to better connect people to their health.”

To do this, the customer experience will be upgraded. They will be re-thinking interior design, signage and layout. “Customers are already waiting to see a new store prototype or flagship location. This will occur in 2013, whether it is a makeover of an existing store or a new store in a new market,” Rosenhek says.

Although all 80 stores are corporately owned, the new owners don’t want Le Naturiste to be pegged as a “big chain.”

Unique product mix  

Rosenhek explains, “The amount of products that you wade through in U.S. chains is enormous, with 20 to 30 brands of each supplement or several feet of one brand merchandised together. Our job is to sift through and edit products to buy an intelligent mix, rather than becoming an impersonal environment where a customer asks about a product and the clerk says, ‘They are in aisle 17. Good luck.’ We must also rationalize why these two or three are best, targeted for specific customer’s needs.”

Local focus

Le Naturiste currently offers popular brands like Adrien Gagnon No, Genacol, Genuine Health, New Nordic, EAS and PVL, but the owners are also forging new relationships with smaller local producers within Quebec, and other parts of Canada. Rosenhek says, “We will seek out international specialty items, but for core products, why add environmental impact from something put on a ship or plane that isn’t necessary?”

They won’t give up bestselling Le Naturiste private label products sourced from Europe which have established the company as a leader. Rosenhek says many people rely upon its France-made ampoules (small glass vials that contain a one-dose liquid remedy) formulated for increased energy, weight loss, nutrient absorption and system cleansing.

Kau explains, “Europeans have advanced knowledge in plant extracts since their greater degree of acceptance by consumers creates demand for increased research. The ampoules we buy use a cold-pressed process that has not been replicated in North America.”

Combined experience

Kau, who describes the chain as “the perfect little jewel,” is responsible for anything that touches the customer: consultants, merchandising, in-store experience, branding and marketing. Rosenhek, formerly an accountant, works with research, finance, operations and buying teams.

Although the natural products sector is growing, government regulation and economic barriers frighten some newcomers away. But Rosenhek says they applaud Health Canada regulations because a large percentage of consumers still question the efficacy of natural products. “We were interested in buying Le Naturiste because it has a history in keeping abreast of these issues, and customers trust its quality. New regulations will help promote our company’s scientific basis, and improve the industry’s image.”

Behind the scenes

The company’s rigorous quality control department researches what claims are being made and whether those claims should be made; they consult on product design, and are part of the buying team to decide what makes it onto store shelves. Scientists in external and internal laboratories ensure efficacy, whether it is sampling products purchased from national brands or researching private label ingredients,” explains Rosenhek, who feels that shoppers are looking for greater transparency regarding ingredient sources.

Would Canadians rather shop a chain? 

There aren’t many Canadian chains of this size, which has advantages. Customers can count on favourite products being available at every location. The company has the ability to create private label formulas, and have economies of scale for product pricing, unlike most independents. Its community stores also have a long history of personal relationships with clientele.

Rosenhek says, “As a customer, I used to leave my local pharmacy with no product in hand because I was confused. To take products appropriately and effectively, you need to receive proper questioning at the store. Sometimes product A and B work effectively together, but you won’t know it unless told.”

Specialized service

Plans include offering in-house professional practitioners’ services, in-store guest lectures and public health testing, comprehensive written information, and an interactive online experience. Kau, says, “Using technology, we are working on creative ways to enable customers to have live (real-time) health consultations with our corporate naturopath, and to get customers involved in helping to choose products.”

The future? 

Rosenhek says, “We have twinkles in our eyes when asked about plans. We have lots of possibilities to expand through strategic alliances and acquisitions with retailers and suppliers. We have been presented opportunities abroad, too.”

The company will introduce professional-level products that consumers don’t usually have access to. European personal care items will be offered at a level not seen in the North American industry including high performance creams with completely natural ingredients. Environmental responsibility will increase. “People now buy products that are healthful but aren’t made with eco-friendly ingredients or manufacturing processes. We are looking at more traditional and more advanced methods that are highly sustainable,” concludes Rosenhek.

Stores may close and open

The chain’s 78 Quebec stores and two New Brunswick stores may change after the owners examine whether each location has evolved with their neighbourhood. “Customers may move away from certain areas; traffic patterns may have changed, and a store may not still be pertinent. Yet some locations have been points of reference for 20 to 30 years so we have to be careful,” Kau says.

Believing their business model can easily be exported, they plan to open new stores where a client base exists. “Ontario is looking pretty good,” Kau admits. Rosenhek qualifies, “As native Quebecers, unlike NBTY, we know this market. We have also worked outside the province so aren’t afraid of expansion, yet are aware that you can’t cookie-cutter stores, and must understand and adapt to customers in different regions.”

They’re not experienced supplement users

Kau feels she represents the majority of occasional shoppers who venture into a health store. “I wasn’t a big user of these products because I never understood how to interact with them. I would use one or two and then stop, not because I wasn’t interested, but because no one who acted like they understood my needs offered advice I could follow, so I could shop with a degree of confidence.”

Rosenhek was similar. “I’d spend more time in the supplement aisles than anywhere trying to find natural ways to deal with ailments I suffered from including migraines, and aches due to overdoing activities like running. Yet I only bought basic vitamins because I never got help. I am now able to deal naturally with health issues that have bothered me for years simply from learning more within this business in the past few months. I am like our customers and Melanie, very interested but never knew how to get to the next level.”