The global nutraceutical industry is expected to grow at a 6.3% CAGR to reach $204.8 billion by 2017, according to Transparency Market Research, with North America retaining the largest market share. Dietary supplements have been among the fastest growing segments of the industry, accounting for about 37% of the total market share, and present an enormous opportunity to companies in the space.
While nutraceutical retailers like GNC Holdings Inc. (NYSE: GNC) are leaders within the market, investors willing to assume a little more risk may want to take a look at smaller companies in the space that offer unique competitive advantages. After all, it’s much easier to double $1 million than $1 billion in market capitalization.
In this article, we’ll take a look at a micro-cap company focused on nutraceuticals that recently opened its first retail location.
Earth Science Tech Inc. (OTC: ETST), a unique biotechnology company focused on nutraceuticals, bioceuticals, and dietary supplements, recently established a new wholly owned subsidiary called Nutrition Empire Inc.
Nutrition Empire is opening an upscale retail location in Coral Gables, Florida to sell health and wellness products. The move could set it apart from many other development-stage companies in the space.
Figure 1 – Retail Location & Construction Photo – Source: Company
“Nutrition Empire recently executed a five year lease with a three year renewal option for its retail store location which will be located in the heart of Coral Gables Florida,” said Earth Science Tech CEO Harvey Katz, Ph.D. “Earth Science Tech will look to update the market and its shareholders in the near-term with regards to the Nutrition Empire store, location, and launch.”
Under the lease terms, no other nutrition or supplement stores will be located within a three-mile radius of the company’s store, which should help limit the competition in the premier shopping district. The store itself is located on the ground floor of an upscale luxury apartment home community and next to a 24,000 square foot upscale gourmet grocery store that provide ample foot traffic.
Nutrition Empire will be managed by leading veterans in the nutritional and dietary supplement industry and carry top health and wellness brands. Management is currently focused on completing the interior custom build out of the modern upscale retail store location with architects and will update shareholders regarding the status of the project and launch over the near-term.
Supplemented with CBDs
Earth Science Tech differentiates itself from the competition by carrying completely legal cannabinoid-based products. Since the products are hemp-based, they contain ultra-low levels of pyschoactive tetrahydrocannabidol (“THC”) and high levels of potentially therapeutic cannabidiols (“CBDs”). The company’s products include a number of different types of high-CBD hemp-based oils for different purposes.
Figure 2 – Hemp-based CBD Oil Shipment – Source: Company
The growing popularity of medical marijuana has generated a rising number of research studies confirming CBDs’ potential for treating numerous conditions, including chronic pain, diabetes, cancer, cardiovascular diseases, alcoholism, PTSD, schizophrenia, antibiotic-resistant infections, rheumatoid arthritis, MS, epilepsy, and a number of different neurological disorders.
In late July, the company announced that it received its first major shipment of 25 liters of Advanced High Grade CBD (Cannabidiol) Rich Hemp Oil. The product is considered to be “food-based” and may be distributed in all 50 states and 40 countries as a nutritional and dietary supplement designed to support overall health and wellness given its low THC-content and high CBD-content.
Hemp oil’s status as a “food-based” supplement also differentiates the company from others in the cannabis industry. Whereas companies like Tweed Inc. (OTC: TWMJF) (CSE: TWD) and GW Pharmaceuticals plc (NASDAQ: GWPH) are required to seek regulatory approval from governmental bodies, Earth Science Tech can sell its product as-is to consumer end markets without any lengthy approval process.
Earth Science Tech recently received its first shipment of hemp-based CBD oil and is gearing up to open its first retail location. Combined, these two events could set the stage for near-term revenue generation, which would set it apart from many other micro-cap companies in both the nutraceutical and cannabis industries. As a result, investors willing to assume the risks may want to take a closer look at the stock.
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