Nutritional Growth Solutions strikes three-year US distribution deal with The Healthy Chef
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Health and wellness company Nutritional Growth Solutions (ASX: NGS) has secured a three-year deal to produce and distribute The Healthy Chef products throughout North America.
The intellectual property (IP) agreement will allow Nutritional Growth Solutions to sublicence, manufacture and sell all Healthy Chef products exclusively in the US and Canada.
The increased scale will enable the company to maximise its US infrastructure and fast-track the path to positive cash flow and profitability.
Revenue boost
Under the terms of the deal, Nutritional Growth Solutions will have access to a portfolio of 28 Healthy Chef products based on protein, collagen, probiotics and supplements targeting high-demand segments such as weight loss, gut health, stress, sleep, immunity and menopause.
The first year of the agreement is expected to boost the company’s revenue by more than $2.2 million, or approximately 45% of its 2023 full-year revenue.
Nutritional Growth Solutions will retain 90% of all net revenue generated, with the remaining 10% distributed to relevant licence holders of The Healthy Chef IP.
If royalties do not reach $150,000 at the end of each 12-month period, Nutritional Growth Solutions will be required to pay each licence holder a top-up royalty.
Optimising health
The Healthy Chef was founded in 2006 by nutritionist, wellness coach and best-selling author Teresa Cutter on the premise that wholefood nutrition is essential to optimising health and wellbeing.
Products are primarily sold through the company’s direct-to-consumer e-commerce platform, which is underpinned by a library of product innovation, content, cookbooks, recipes and IP including seven US trademarks.
Ms Cutter will be retained by Nutritional Growth Solutions as a US brand ambassador and will help with product and recipe development under a consulting services deed.
Pivotal step-change
Nutritional Growth Solutions managing director Stephen Turner said the deal marked a pivotal step-change for the company.
“This is our first IP licencing agreement partnering with synergistic Australian brands poised for success in the US market,” he said.
“The enhanced, capital-light model leverages our existing team expertise, infrastructure and US distribution platforms, enabling us to scale rapidly without additional capital or significant increases in corporate costs.”
Mr Turner said the The Healthy Chef brand would be a “highly complementary” addition, as both businesses share a “common vision” regarding the future of food, health and wellbeing.