Weight Reduction Services Industry Overview

Excerpt from Weight Reduction Services Report

The US weight reduction services industry includes about 1,300 companies with combined annual revenue of about $2 billion. Major companies include Weight Watchers, Nestlé's Jenny Craig, NutriSystem, and eDiets. The industry is highly concentrated: the 50 largest companies account for 80 percent of industry revenue.

Competitive Landscape

Consumers' excess weight, personal income, and leisure time drive demand. The profitability of individual companies depends on effective marketing, customer acquisition and retention, and efficient operations. Large companies have advantages of scale in marketing, infrastructure, and partnerships. Small companies can compete effectively by offering individualized services or upscale facilities. The industry is labor-intensive: average annual revenue per worker is about $75,000.

Products, Operations & Technology

Major product lines are program fees, food supplements, and other merchandise sales related to diet and weight reduction. Weight loss services account for 55 percent of industry revenue, and food, online access, and other merchandise sales and services for the rest. Products include DVDs, CDs, food scales, journals and other record-keeping materials, cookbooks, and motivational and self-help guides. Specialty products include exercise accessories, magazines, and packaged food, often available for home delivery. Weight Watchers' branded magazine has about 10 million US readers.