Canadian Retailer - Spring 2013 - 42

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in pay for each level that they pass
that’s commensurate to the score with
which they passed.
“Our store health enthusiasts really
appreciate the program because it has
real incentives for them to excel and
grow and learn with the company,”
points out Balbale. “We think it provides the right feedback for all of the
personal investment that our store
health enthusiasts put into the company and serving our customers.”
Meeting regulatory differences

Aside from the customer and the
health enthusiasts that serve them,
the company also had to examine its
internal breadth that Balbale speaks of
to ensure that challenges related to expansion into Canada were met head on.
“This was our first expansion outside the United States, and so we
faced internally the challenges that
any company does leaving their native market,” explains Balbale. “We
had to learn everything from managing multiple currencies, how to
identify and comply with local regulations, whether it be financial or human resources related, finding local
partners, our legal counsel, marketing partners and folks that could
build a construction for us and put
our fixtures together in our stores.”

Knowledge and passion fuel the Vitapath experience

responsible for delivering their respective solution in Canada.
“We worked really hard together to
make sure that where those business
units overlapped, we really understood
the nuances and requirements so that
we could deliver an exceptional experience for our Canadian customers.”
What was most challenging for
the company, however, was in developing operational processes that
differ from those that they employ in
the United States.
“In the United States we’re a 582 store
chain,” says Balbale. “We have our own
distribution centres, and we have all

“We hire on three filters—empathy, knowledge
and passion—and we never compromise on
these core attributes when searching for talent.
We’ve found that if we hire with these criteria
in mind, we get really great people who are
tremendous for our brand.”

— MUSAB BALBALE
Vitapath

The company tackled these challenges by making the expansion a
company-wide effort. According the
Balbale, Vitapath and its American
parent The Vitamin Shoppe are both
internally very operationally focused
and have a pretty collaborative culture. The combination allowed them
to tackle the challenges as they arose
by making each of its business units

42 |

of the vendors ship to our distribution
centres which we then ship out to our
stores. In Canada because of our smaller scale with two initial stores, we chose
to develop a direct to store delivery
supply chain model.”
The direct to store model involves
product coming into the store which
needs to be opened, counted, audited,
with all information communicated

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back to the vendor. Balbale admits that
the process is not perfect, allowing too
much room for error on both the store
and vendor side, but that they are
working through the challenges.
Another challenge faced by Vitapath
in Canada, and another reason to implement the direct to store shipment
of product, is in addressing challenges
posed by Health Canada regulations
which differ significantly from those
south of the border. In Canada, retailers offering supplements and other
health food and vitamin products are
required to sell only products that have
been registered with Health Canada
and that have received what’s called a
national products number. In addition
to that, the full chain of control from
manufacturing to delivery of product
to the store needs to be licensed by
Health Canada.
“In order to comply Health Canada
regulations, we’re working primarily
with Canadian brands and Canadian
distributors—over 80% of our product is sourced locally.”
A Canadian company

This decision, however, was not
only to simplify the sourcing strategy
and to reduce the number of imports,
but to ensure that Vitapath is a truly
Canadian business with Canadian
brands and Canadian distributors.
“It’s a decision that we’ve come to be
really proud of,” says Balbale. “We’ll
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Canadian Retailer - Spring 2013

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