Nestle is selling its diet business Jenny Craig, and is said to be in talks with a small group of potential buyers. Last week, top executives from the Swiss food company announced they were looking to trim some of its underperforming businesses. According to sources familiar with the matter, Jenny Craig is on that list.
The diet company has remained one of the most popular programs for dieters, in part because of their focus on food, body and mind. It also has an extremely loyal following that vocally advocates for its programs. Featuring many high-profile celebrity endorsements, Jenny Craig was purchased by Nestle seven years ago in 2006.
Jenny Craig is part of the Nestle Nutrition unit which also includes Gerber baby food and the Powerbar energy bar brand. Reuters, which first reported the potential sale of Jenny Craig, said last month that Powerbar has also been put up for sale.
Though many news outlets are reporting the upcoming sale, Jenny Craig is staying quiet on the issue. When reached for comment, PR Manager Marissa Buntz said, “We don’t comment on rumors.”
Recently Jenny Craig has faced some serious competition from NutriSystem and other major weight loss brands. The growing popularity of free online and mobile fitness apps have also put some pressure on the brand.
According to Reuters, during an August earnings call, Nestle Chief Financial Officer Wan Ling Martello said, “We do not disclose profit by businesses, but I will tell you that the Jenny Craig business – this year as well as last year – was very much below our expectations and below what they have been able to do in the last few years.” If the brand is truly not meeting performance expectations and Nestle is looking to trim the fat, it looks as if this rumor could be true.
October 14th, 2013