Schiff president predicts an end to competitive discounting

SALT LAKE CITY Competitive discounting among the bone/joint supplement health business may be nearing its end, thanks to rising raw ingredient costs, Bruce Wood, Schiff Nutrition International president and chief executive officer, told analysts during a conference call Thursday morning.

“We are starting to experience joint care ingredient cost increases,” he said, which in turn may impact the ability to discount the Schiff brand in the coming year. “It remains to be seen how underlying raw ingredient price increases will impact the market,” Wood said, but conjectured that manufacturers may not be able to discount products in the bone/joint category for too much longer.

Although Wood did not mention NBTY at all, competitors in the space have in the past noted the difficulty in matching NBTY’s frequent buy-one-get-one promotions across its Osteo-Bi-Flex brand.

Schiff posted net sales of $47.8 million for the three months ended Aug. 31, 2008, a 17.4 percent increase over year-ago results. “The significant increase was driven by incremental private label sales volume as new business acquired in the fiscal 2008 fourth quarter continued to positively impact the current quarter,” Wood stated.