Protecting Portfolio Investments – Avoiding Recalls & Addressing Food Safety
Supplement Industry takes a hit – raw material testing crucial in avoiding recalls and protecting portfolio investments
Recently, New York State Attorney General, Eric Schneiderman, demanded four major retailers to stop selling their private label brand supplements after tests revealed the contents of the supplements did not reflect what was stated on the labels. This news should increase Private Equity investors focus on the testing practices of current and potential portfolio companies.
Routine identity testing of raw materials is a best practice for the VMS (Vitamins, Minerals, and Supplements) industry, as well as all the “better-for-you” products that are quickly gaining in popularity. Supplier Due Diligence vetting is critical, but going one step further and confirming their claims adds another layer of protection for the company and the investor.
This market remains highly profitable and can withstand this setback as long as manufacturers increase their vigilance in ensuring their product claims.