ULTIMATE SPORTS NUTRITION: USN Growth Strategy Gains Big Boost

As one of the truly great South African brands to go international, Ultimate Sports Nutrition (USN) continues to power a generation of athletes and sports enthusiasts with its portfolio of scientifically proven nutrition and wellness products. Now, with more than 20 years of experience, USN is looking to further strengthen the grip it holds over the market both locally and internationally, and always-industrious CEO Albé Geldenhuys continues to search for gains across all verticals.  

Already operating across the major markets of the world including the USA, UK, Germany, Slovenia, Russia, Spain, France, Malaysia, the Middle East and more, USN has strategically positioned hubs around the world as it looks to diversify its operations and reduce the risks of being exposed to South Africa alone.  

Globally, the sports nutrition market is set to bulge, reaching US$35.4 billion by 2025. As one of the fastest growing sports nutrition brands, USN is ready to pump its market share to new heights as a renewed focus on healthy living sweeps the globe. Protein, creatine, vitamins and capsules, weight control, pre-workout, accessories and much more are manufactured to very detailed recipes much to the delight of clients from all different sporting backgrounds.  

Progress for USN starts at home, and in March 2021 the company began working from its new head office in Louwlardia Logistics Park, Gauteng. By upgrading its space to a brand-new building, and moving office, manufacturing, logistics all under one roof, the company is well-placed to effectively distribute all over the country.  

BIGGER, BETTER 

“A lot of our growth is now being initiated by adversity and challenges,” Geldenhuys tells Enterprise Africa, talking about the challenges faced as a result of the Covid-19 pandemic. “We were forced to take over our own logistics again so that we have more control over our supply chain which meant that our service levels improved significantly. It was all because of adversity during the Covid time. Some of our subcontractors were struggling so we planned our new space to set up for a logistics operation. We still outsource the function of logistics – we are not experts in logistics and we are the first to admit that – but at least we now have control over the USN supply chain.”  

The new custom-designed site covers 14,000m2, over a ten-year lease and offers the company the ability to deliver faster market response and world-class customer service. Great access to the N1 allows for smooth distribution countrywide, as well as quick input from the Port of Durban.  

This is important as the company will utilise manufacturing capability in South Africa to complement its global output as the push into new markets, and pull from desperate customers, continues.  

“We started shipping a lot more products to Russia, the Middle East and the Far East including Malaysia,” says Geldenhuys. “Our capacity has grown significantly in the last two years, so we are expanding our factory to double our capacity. That is where most of our growth is going to come from. 

“Because manufacturing capacity has been a problem during Covid times, we had to think creatively and as result are now manufacturing products in Europe for distribution to countries in Europe, the Far East and the Middle East. We manufacture in the USA for distribution down to South America. We are well covered when it comes to dealing with challenges around transport, shipping, and sanctions. We are now in a very good space to enter a period of consistent growth. We no longer have all eggs in one basket and if we are dealing with adversity on one continent, there are two others to support our growth and help the business to help the country.”  

Traditionally, products manufactured by USN in South Africa have been made for the local market, but international growth has required a shift in strategy. “Since we started growing in Russia and Malaysia in the last year, the demand has grown so quickly that we could not satisfy the need from the UK alone. We are increasing our capacity in South Africa to meet those demands again,” confirms Geldenhuys.  

This expansion is very welcome for USN, and the CEO admits that, as bitter lockdowns kicked in around the world and stores were forced to close, hopes for a beefy 2020 were quickly torn.  

“We anticipated much lower sales for the UK market for 2020 than what we actually got. We ended up achieving our original targets that were in place before Covid. In the first two or three months, we lost some sales, and it was the same in SA where we lost around 20% of our sales, but after that it really picked up,” he says.  

The reasoning is now all too familiar. Gyms and fitness clubs closed, sporting events on hold, retailers closed or operating at limited capacity, people scared to get out. But naturally, as time passed, a safe approach to reopening was promoted and people were desperate to improve fitness.  

“A lot of that has to do with people sitting at home, being bored, eating and drinking whatever, and getting out of routine,” explains Geldenhuys. “A couple of weeks pass, and people start thinking that they are going to go backwards if they carry on. So, they switch and do the exact opposite – go out and buy supplements, train at home, buy meal replacements to stop snacking, and they realise that it’s not all that difficult to train at home and be active. It is convenient to go to the gym and complete all the exercises, but running, cycling, working out at home is very doable. People realised how easy it is to stay in shape with less resources.”  

USN offers training and eating plans that are made available online for free to complement its product range. In April, GQ magazine labelled USN’s Blue Lab 100% Whey Premium Protein among the top ten available in the UK market. This product range is at the heart of USN and Geldenhuys is keen to continuously improve on products that have been so important in the company’s development globally.  

STRONG RANGE  

“From a creative point of view, we have put a lot of focus on our successful products and how we can make them even more effective,” he says.  

“We are entering more categories; expanding in wellness, growing with multivitamins, we are driving the keto movement where we have some products. At the same time, we are making sure that we maintain our growth in the traditional categories of whey protein powders. Our sales are already 50% up on last year which, considering the times, is quite good.”  

Whey protein is a rich source of amino acids and is usually a milk-based product used to rebuild, refuel, and grow quickly after exercise. It is the favourite of those looking for muscular hypertrophy (building muscle mass) and can be a great supplement for athletes competing in strength and endurance disciplines. BlueLab 100% Whey is a favourite in the USN portfolio and used by the likes of Rassie van der Dussen, Herschel Jantjies, Talitha van Dyk, Shelby Neves and Ferdinand Omanyala, and stocked in a range of outlets including Dis-Chem.  

After dominating the market in SA, the first push overseas for USN was in the UK in 2009. What prompted Geldenhuys to take on a geography with strong, established competition? “Complete ignorance,” he laughs.  

“I didn’t realise what I was getting into. I thought ‘we’ve been successful, how hard can it be?’ It was very very hard. However, you should never give up and the relentlessness, and the realisation that we are halfway up the mountain, drove us to achieve. We focus on what the consumer wants, quality of products, strong brand, good relationships, and finding retailers to work with in whichever country we are in. It’s about being relentless day in and day out and eventually things will start ticking over. It’s extremely stressful, and it’s never easy.”  

Relationship building has been a vital element of the company’s strategy and by teaming with recognised sports personalities and retailers in the USA, UK, SA and other markets has helped to promote the science-based, high-quality nutritional characteristics of the range, which is now available in 70 countries.  

“Even before the Covid outbreak, there were a couple of challenges that we had to consider. Brexit was a contributing factor. When I started in the UK, I had manufacturing partnerships in Belgium because we would not have had the capacity in South Africa to ship into the UK and Europe. Most importantly it was for legislation purposes and to ensure we didn’t sit with capital in transport. What has helped us grow in the UK a lot has been capable manufacturers in Belgium who understand flavours, quality, and packaging. They have grown alongside us,” explains Geldenhuys.  

“In the USA, we have manufacturing facilities in Buffalo New York as well as a couple of manufacturing outlets elsewhere. For the US market, and everything exported across the Americas, we produce everything there. Before Brexit, we moved some manufacturing capacity into England to compensate for potential taxes and other uncertainties. We had to move very quickly, having products reformulated ready for the UK market.”  

Today, USN also has manufacturing capability in Spain where vitamin and other tablet-based products are made, mainly for the Russian market. There is also an independent distribution company based in Marseille, France – formerly owned outright by USN – which handles import and distribution for various European markets. Across all locations, the company employs an outsourced model to allow USN staff to focus on their core strengths.  

“When you start trying to do everything, your staff count grows but it takes focus away from what you are really good at which is branding, innovation and sales.  

“We are trying to get the best positioned manufacturers for wherever we are shipping the product to,” confirms Geldenhuys.  

ULTIMATE INNOVATION  

USN is perhaps the best examples of a South African brand that personifies and promotes never standing still. Movement into the new facility will be followed by a major push on innovation with new products across a range of new categories being released.  

“We always have a whole list of innovations that we are working on,” admits Geldenhuys. “Some of them may never see the light of day, but innovation takes time and we don’t rush things to market. In energy drinks, we are focusing on new flavours. We have a product off the line focussed on the gaming market, which has grown so much. It’s a very precisely formulated cognitive function energy drink designed for gamers. If you launch a good product, word of mouth usually sells it. We are looking at partnering with Xbox, and partnerships like this have been something which have helped us a lot.”  

Partnerships have also been sought with Nestlé, where the two companies have worked together to develop new chocolate flavours in the whey class. Similarly, in the pre-workout category, USN has teamed with JBL to develop marketing campaigns that drive consumer interest. “It brings good credibility and strong brand association,” says Geldenhuys.  

Flavour technology has helped to open new growth avenues where brands can now deliver flavoursome products, with less sugar, from plant-based ingredients – all while delivering the same punch of protein. Between 2016 and 2020, plant-based product launches across sports nutrition categories grew by nearly 25% globally, showing significant consumer interest in protein sources that are healthier, with a smaller environmental footprint. 

“We are also looking at organic, whole-food shakes. We have a Wholefood Gainer and we have 100% Plant Protein which is showing great momentum, so this is a category with a lot of promise for us. In all our categories, we are focussed on improvement and growth,” Geldenhuys points out.  

By forming a more cohesive and integrated approach to logistics and manufacturing, growth will come through economies of scale as USN goes to market as a global business rather than smaller, individual country units.  

“We are focusing on using our global size to strengthen our relationships with our suppliers so that we can source the highest quality whey protein and creatine where we are doing significant volumes. We have been working in isolation between the UK, South Africa and the USA, sourcing ingredients independently. Now, we are using our strength as a global company to source as one buyer,” details Geldenhuys.   

“We are also looking into investing in our own capsule and tablet manufacturing capability. It’s a lot more technical and takes a lot of investment but, ultimately, if you look at the vitamin tablet market has grown since lockdown, it’s significant and we see it as a massive growth opportunity,” he adds.  

Fortunately, in times where business growth and sustainability has been tougher to achieve than ever before, USN has continued to demonstrate what is possible when determination and persistence is applied. Like the rugby star looking to gain muscle mass, consistency, and a focus on doing things the right way has been key for USN riding out the storm. Consumers know the brand, and it provides comfort when times are tough. A Deloitte report released suggests that as concerns about physical well-being increase, propensity to purchase name brands also increases. The same is true as concern about financial well-being rises.  

“In these times of uncertainty, it’s amazing how customers go back to the brands they trust. It is not a time to take a chance on something new. They want to invest in what they trust,” confirms Geldenhuys.  

Clearly, USN is a South African brand, trusted globally, with mass appeal that is only going to improve and expand as the product portfolio and international reach increases. With two decades behind it, market share is there for the taking, and USN knows how to press.  

Unfortunately, due to lockdowns and restrictions, the company wasn’t able to celebrate its platinum anniversary in 2020, but Able Geldenhuys promises that all stakeholders will have the chance to reminisce of successes very soon.  

“At this stage we will continue with special campaigns and deals for retailers and customers that have supported us. There’s no question that we will create excitement,” he concludes.