April 16, 2014
Al Powers and Howard Schiffer
This month, Al Powers announced his retirement from NOW Foods, where he worked for 40 years, most recently as CEO of NOW Health Group. A recipient of the Nutrition Business Journal Lifetime Achievement Award in 2011 and the Presidential “E ” Award for Excellence in Exporting in 2008, Powers was on the ground floor of both NOW Foods and Natural Products Expo. Today, NOW is one of the largest independent manufacturers of natural products in the U.S. health food store channel. We chatted with him from his Chicago headquarters.
Natural Foods Merchandiser: You’ve been in the natural products industry 40 years. How did it all begin?
Al Powers: I’ve been involved in daily operations at NOW Foods for 40 years. When I came into the industry in 1974, NOW evolved out of a chain of retail stores called Fruitful Yield, which I managed for 25 years. We still have those 12 stores in Chicago. And I still go out to be in the aisles talking to customers. It keeps us grounded to what the consumer wants. When I came into the business there were only three full-time people at NOW, Elwood Richard, myself and a secretary. She took all the orders, we filled them and did all the other things necessary to run the business. It was really a small operation in those days.
I should also mention that I was a speaker on a retailer panel at the first Expo West event in 1980. In those days they called it NFM Expo West. I remember huddling the night before with [New Hope/Expo West founder] Doug Greene to figure out what we were going to do at the event. At the time, I never thought it would become the natural products industry megaevent it has become!
NFM: How did that switch happen from a retail chain to a manufacturer?
AP: Elwood, our founder, determined there was a real need for a value brand because of high prices found in health food stores. In those days the model for selling health foods was selling through distributors at very high prices. It was not competitive with grocery stores at all. One day a customer said, 'Your prices are way too high.' Elwood decided to do something about that. What he did was find the sources of supply for these products. In those days it was basically foods, that’s why we called it NOW Foods. So he was bagging products in the back of his health food store, putting a label on it, and putting a twist tie and selling it on shelf at prices that were competitive with grocery stores, only the ingredients were higher quality. That was the basis of NOW Foods-–high quality at low prices. It’s the value equation and it’s the equation of the brand even today.
NFM: Under your leadership, NOW has achieved the enviable task of demonstrating a commitment to old-school health food channel sensibilities while at the same time setting an example as a leader in regulatory compliance, testing and product quality. How did you do it?
AP: It’s really a principled approach to business. When you think about it, we’re all passionate consumers of health foods. We view ourselves as consumers. We say, 'If I’m a consumer what would I want?' I want high quality, low prices, and I want those products tested. We decided at NOW to be a brand that you can trust. The best business model is to act in the best interest of your customers.
NFM: NOW Foods is known as a value brand, but at the same time committed to product quality. How do you do it?
AP: It’s difficult to do. We focus on a relentless drive to reduce our costs, without sacrificing quality. So you won’t see us take first-class flights, we don’t drive fancy company cars, the fact is everything we do we try to do it for the benefit of the consumer. If it’s not necessary and we don’t have to spend it, why do it? It sometimes works against us because for example we don’t have a lot of field representation that a lot of our competitors do. We do a lot of our business by telemarketing. We cover only the intensely populated markets like Southern California, where we have reps all over the place, but no reps on the ground in many rural states.
Returning to our roots, food and politics
NFM: After years of focus primarily on supplements, NOW has in the last few years put a lot more emphasis on foods and personal care. How has that evolved?
AP: Supplements are our largest category certainly, but the fastest growing categories are natural foods, personal care and sports nutrition. It gets back to our mission, which is to provide value in products and services that empower people to live healthier lives. That’s more than supplements-–you have to have a good healthy diet, personal care products that don’t harm you, and with sports nutrition you need clean products with no ingredients that you can’t pronounce and could be harmful. All of our natural food products are non GMO. We try to be a one-stop shop for independent health food stores, which is the core of our business and the industry and the core of what happens every day.
NFM: As a board member of several trade associations, do you see the industry as a whole well represented and protected by the trade associations?
AP: If you look at our track record, you have to say we are. We are a small industry that could be subject to predatory regulations and legislation, and in many cases it’s unnecessary because these products are safe, you have to say that supplements are safer than pharmaceutical drugs. The trades have been effective in protecting us.
We are well represented in Congress. I was at lobby day in Washington, D.C., for the Natural Products Association, and there are a lot of zealous people who believe in what we’re doing and want to beat the paths of Congress to defend this industry. A lot of health food stores are doing a fantastic job in their communities helping people. I know we’re not supposed to say it but they’re being healers, pointing people in the right direction, educating our communities and helping people recover from unhealthy lifestyles. People were sharing those stories with Congressional staffers who thought we were a hokey industry, but the reality is we’re really helping people. That’s why people rise up when you try to take away those health freedoms. There are millions of people who have been helped by our industry who want to stand up and say don’t take these products away from us. Grassroots are as important if not more important than trade associations-–I know that’s a controversial statement, but when you look back at history we were saved by the grassroots many times.
Beyond business and honoring the work
Al Powers in Africa
NFM: You have done work in Africa setting up nutrition programs. What led to that idea, and what were the results?
AP: The African thing I did at one time with Compassion International to support Vitamin Angels. What I found is it’s difficult to just go out there and plant something in a country like Uganda. That’s because one of the things we faced was severe regulations that prevented even charitable entities, let alone profitable ones, to go in there. That was an effort really to support Vitamin Angels, and its traditional model is to work with NGOs within these countries that are difficult to penetrate, so it helps to have a partner in that country. That’s what Howard Schiffer has done with Vitamin Angels, and he’s doing it the right way.
NFM: What do you get out of that, personally?
AP: I’m a born-again Christian. I believe in the Bible. That’s what Jesus did basically, he healed people before he even talked to them about spiritual matters, because he had compassion to address the human need. At NOW Foods, it’s our mission to provide value in products and services that empower people to live healthier lives. In some cases people can’t think value because they can’t afford to buy anything. So we have a responsibility to help people by providing products that they otherwise can’t afford to buy, and we do it on a charitable basis through Vitamin Angels and other charities that provide health care and healing, not even supplements but access to medical attention. That’s part of our DNA, we believe it’s part of our mission to not only save the world but to heal the world. There are so many people who need healing. You go out to a place like east Africa like I did seven years ago, my wife and I were on that trip and most of the time we were crying. Out there they get diseases like AIDS and they can’t even get medical attention, there is no health care system for these people. It’s just heartbreaking. So when you see that level of need, I feel compelled to address it. I’ve been busy growing our business, and I’m not always out in the field, but that’s why I appreciate Howard’s efforts and others in and outside our industry who make that their mission.
NFM: You’ve received several notable awards in your career, from Vitamin Angels to Nutrition Business Journal and President George W. Bush. What universal philosophy of yours ties together all these acknowledgements?
AP: My philosophy in life is that God has a plan for each one of our lives and if you embrace it and put your trust in God then all these good things happen. Frankly, I’m humbled by that. It’s not about me, it’s about God’s plan for my life, and thank God it was in this industry. I’m so grateful for that. Because it’s not just to gain recognition, which is nice, but what’s really important is we know we’ve touched many lives and made a difference in our world. I can also say it’s revolutionized my health and life. I’m grateful for everything that’s happened during my 40 years in the health food industry.
Lessons learned and looking forward
NFM: Looking back, what’s a big lesson learned?
AP: The big lesson I’ve learned is to stick to your values as a company. If you can run your company by principles and core values, and if you sustain it over time you can have incredible success. That’s been a big contributor to our success at NOW.
NFM: Is there anything you would have done differently during your career?
AP: I would preach the good news about NOW Foods to a wider audience. There are a lot of stores that do not carry our products, and one of the problems is we don’t have wide sales representation on the ground. A lot of our competitors say you get what you pay for, it’s all about price, therefore they take a knock on our quality, but our quality is extremely good. In order to make that case to more stores, you have to be on the ground, you have to be one on one, person to person. So maybe greater sales representation would help us to get into more stores, but the brand in overall categories is still the market leader in the health food channel. It’s just that we don’t have the widespread concentration of customers that we’d like to have. Take New Chapter or Garden of Life, they’ve got representation everywhere and as a result they have greater store penetration than we do. But once we make a store a NOW store and they start selling these incredible products at value prices, we find that we get incredible penetration in that store, and that’s what helps make us the No. 1 market leader across all the categories combined, according to SPINS and other ordering sources.
NFM: NOW is a family brand. What do you envision as the next generation of leadership takes the helm?
AP: One of the best things you can do is to develop a sustainable business and have people succeed you. Jim Emme, who is taking my position, is a 19-year veteran of NOW Foods. He’s passionate about supporting independent health food stores and the NOW value brand.
NFM: What’s next for you?
AP: Outside of NOW, I’ll be taking a break. After 50 years in the workforce, this’ll be the first time I can experience what life is like outside of work. I really don’t know what that means except I’ll be taking time to step back and meditate on what I’ll do for the rest of my life. I’m sure it’ll be something to do with the health food industry because that’s our life, and maybe my wife, Kimberly and I will be hippies. She’s been my inspiration. She partnered with a friend in a health food store when she was 16 years old, and my diet is great because of how she cooks with organic foods. She’s been in the industry longer than I have. She’s the best example to me of a healthy consumer because she lives a natural lifestyle to its fullest.
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