Cost Structures and Profitabilities, Q1 2016

What Does The Q1 Reports Show Us About The Profitability Of Network Marketing?

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It has always been interesting to see how direct selling companies compare on various grounds. Where they spend their money and at the end of the day, how much money they generate for their investors absolutely rank among the most interesting ones.

In this article, we will be briefly reviewing 11 direct sellers with varying sizes of business and with different product portfolios. These are Avon, Herbalife, Mannatech, Natura, Nature’s Sunshine Products, NHT Global, Nu Skin, Oriflame, Tupperware, USANA and Youngevity. This review will be based on their 2016 first quarter figures.

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The First Quarter in Giants’ Figures

1st Qt Numbers Are In For Public Direct Selling Companies

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Following the end of the first quarter, the time has come to briefly review the performances of the largest direct sellers. Normally, this analysis has been covering Avon, Herbalife, Natura, Nu Skin, Oriflame and Tupperware. However, Oriflame’s report would come after mid-May so I have decided skip it this time.

Again, the focus in this review will be on these companies’ revenue growth performances. As you see below, Herbalife and Natura posted positive figures whereas Avon, Nu Skin and Tupperware’s growth figures were negative.

#WorldOfDirectSelling

MLM Weekly News Report: What Network Marketing Companies Are On The Rise?

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In this weeks Network Marketing News, we are going to look at some Direct Selling companies who are helping to get the MLM community some great main stream press. Plus some Direct Selling News…

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Home Business Radio Network

Adapting to a New Era in Marketing: Why Social Media Managers Are Changing the Way Direct Selling Companies Operate

DSA News

According to a recent report from Marketing Pilgrim, social media accounts for only 16 percent of customer engagement today. However, this number is expected to rise to 57 percent in just five years, making social media the second-most used channel for businesses and their customers, behind face-to-face interaction.

Recognizing that both customer engagement and field development are largely impacted by a company’s social media presence, many direct selling companies have established social media manager titles and similar positions tasked with monitoring, posting and measuring the effectiveness of outreach via platforms such as Facebook, Twitter and Instagram. Although these platforms were once considered personal-use-only, the rise in social media management titles reflects a shift in the understanding of how social networking sites serve as key resources for companies both big and small. (Read The Full Report)

Direct Selling Assocation

Network Marketing Companies In The News

MountainWest Capital Network recently released its 2012 List of Utah’s 100 Fastest Growing Companies. Nu Skin and USANA were ranked in the Top 15 at Nos. 3 and 9 respectively, while LifeVantage and Supplier member Integracore appeared in the unranked Top 100. Listed on the unranked Utah Emerging Elite list is non-member Miche Bag. MountainWest Capital Network is a business networking organization dedicated to supporting entrepreneurial success in Utah.

AdvoCare will be receiving the Director’s Outstanding Business Award from Northwestern State University’s School of Business. The company’s founder, the late Charles Ragus, will be honored as a School of Business Distinction Recipient.

Amway recently sponsored a fall harvest party for 500 elementary school students in Grand Rapids, Mich. Fifty employees volunteered at the event where kids were able to do crafts, get their faces painted, go on a hayride and more.

In other company news, Amway Canada celebrated its 50th anniversary earlier this month.

CieAura has concluded negotiations with Digital Media Group (DMG) whereby DMG has acquired certain operating assets of the direct selling company. Ken Rasner, Founder and CEO of CieAura, will assume the title of Chairman Emeritus and Paul Rogers, formerly COO of CieAura, will become the CEO of DMG.

The Fuller Brush Company’s consumer business has been purchased by Victory Park Capital (VPC). David Sabin has been named the new CEO of the company. VPC has been Fuller Brush’s lender since 2010, has a strong track record of successfully restructuring businesses and is deeply familiar with the company. David noted that he intends to introduce new products to re-establish Fuller and Stanley Home Products as premier brands in their markets. Founded in 1906, Fuller Brush filed for bankruptcy in February 2012.

The Herbalife Family Foundation, through its Casa Herbalife program, provided a $50,000 grant to foster youth at Koinonia Homes for Teens in Loomis, Calif. The donation will provide the teens with an upgraded kitchen, healthier meals and better therapy for eating disorders.

Medifast, parent company of Take Shape for Life, was recognized by Forbes Magazine as No. 10 out of 100 on its annual list of “Best Small Companies in America.” This is the third consecutive year Medifast was included in the ranking, previously ranked No. 12 in 2011 and No. 1 in 2010.

Scentsy recently donated more than $781,500 to the American Heart Association. The money was raised from sales of its “Heartfelt” charitable cause warmer and was the company’s largest cash donation to date. To celebrate, Scentsy hosted a fun run/walk for its consultants and employees at Kleiner Memorial Park in Meridian, Idaho.

Stanley Home Products recently celebrated its 81st anniversary.

Tupperware recently reported third-quarter 2012 sales and profit, with sales down 1 percent in dollars and up 6 percent in local currency. GAAP net income for the quarter was $47.5 million compared with 2011 third-quarter GAAP net income of $10.5 million, which included a non-cash impairment charge of $36.1 million. The company repurchased in the open market 469,000 shares for $25 million in the third quarter of 2012. Since 2007, the company has repurchased 14 million shares for $728 million and can repurchase additional shares worth up to $472 million under its current authorization that runs until Feb. 1, 2015. The company expects to repurchase $100 million worth of shares in the fourth quarter of 2012. View the full press release online.

USANA announced its financial performance for the third quarter of 2012. Net sales for the quarter increased by 15.1 percent to $165.2 million, compared with $143.5 million in the prior-year period. The growth in net sales was driven by increases in both the company’s Asia Pacific and North America/Europe regions. Changes in currency exchange rates reduced net sales by nearly $1 million. Net earnings for the third quarter increased to $17.5 million, an increase of 41.2 percent, compared with the prior-year period. Net sales in the Asia Pacific region increased by 21.6 percent to $102.7 million, compared with $84.5 million for the third quarter of the prior year. This improvement was due to strong sales growth in Southeast Asia/Pacific and Greater China. During the third quarter of 2012, net sales in the North America/Europe region increased by 5.9 percent to $62.5 million, compared with $59 million in the prior-year period. The number of active associates in North America/Europe declined modestly, compared with the third quarter of 2011. View the full press release online.

Shopping Sherlock

PRESS RELEASE

Oct 22,2012 Santa Monica, California

Shopping Sherlock announced that the 3 month growth in Alexa page views of 170% is the highest growth rate in the Direct Sales space as reported by Ted Nuyten’s leading MLM blog Businessforhome.org.

The rise in web traffic correlates with the increase in new distributors and Company revenues. New distributorships are up over 300% in that period and overall revenues are up over 50%.

Michael Wiedder, CEO of Shopping Sherlock stated that the growth is a direct correlation to the launch of new products and tools. “We released our Daily Deals platform in 12 countries and just recently launched Taiwan as well. With our platform you have access to the top Daily Deal Company’s worldwide and our distributors make affiliate income as people buy and use the same Daily Deals that they are currently buying.

In addition to seeing and buying the Daily Deals from our site, as people are searching for products and services on Google, Yahoo or Bing, our technology lets them know if there is a Daily Deal, or a coupon available for what they are searching for, right from the search engines. As our distributor’s share the Daily Deals or coupons via facebook or other social media , it tracks the sales right back to the distributor’s account, and they make money.”

Wiedder also shared that they are launching their new mobile application on November 1st. The mobile app will allow people to find Daily Deals and Coupons, wherever they are worldwide. It uses your smart phones geo-location feature to show you the Daily Deals and coupons that are available where you are and pays for using those deals and sharing the app with other’s.

In addition, Shopping Sherlock is launching a Social Media platform for their reps this week. Wiedder stated, “ The Social Media platform will give Shopping Sherlock reps, their own blogs that will integrate with all their social media accounts. This combined with the marketing system the distributors receive, gives them turnkey tools to help share and build their businesses.”

Wiedder’s goal is for Shopping Sherlock to be the place to go to find the best deals on products and services both on the Internet and on mobile devices. He believes that as people continue to give the product away for free and benefit as people save money, the Company will continue to duplicate the growth they have achieved in the last 90 days in customers, revenues and new distributors.

For additional info: michael@shoppingsherlock.com

MLM Weekly International News: From the USA to South Africa Network Marketing Is Booming… Plus Surprise About Bon Jovi

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Network Marketing is booming, and it is because everyone from the independent business owners to the company founders, to the direct selling associations from across the globe, to legislative representatives are all coming together to collaborate. Network Marketing is alive in 2012!

HBRN Economic Freedom Context

DSA Ethos Awards

The Pampered Chef, Mary Kay Recognized for Their Commitments to Giving Back

While nearly 16 million men and women throughout the U.S. have chosen to make direct selling an integral part of their lives, millions more around the globe feel the impact the industry makes on a daily basis—many without even knowing it.

Due to unemployment, rising food prices and the housing crisis, demand for emergency feeding services are at an all-time high as one in six Americans struggles with hunger. In an effort to combat the unfolding crisis, The Pampered Chef embarked on a national campaign in 1991 to raise money for Feeding America, the nation’s largest domestic hunger relief organization. For every dollar contributed, Feeding America is able to provide $17 worth of groceries to those in need. (Read On… Click Here)

DSA Champions of Direct Selling

When it comes to government, who is your advocate? Who is your adversary? Who supports your business? Who makes it more difficult?

You need to know the answers to these questions so you and your salesforce can support those lawmakers who know and understand direct selling and your business.

“The ballot box is the most potent form of ‘lobbying’,” said DSA President Joe Mariano. “Casting an informed vote based on your own interests as citizens and business people is critical.”

As part of an ongoing association campaign to commend those legislators and elected officials who go above and beyond to support the direct sales channel—and to better inform you about who supports direct selling—DSA maintains the Champions of Direct Selling website, which recognizes such officials who engage with and educate their fellow lawmakers about the benefits of direct selling and the critical nature of supporting laws and regulations that encourage entrepreneurship and economic growth. As part of the recognition program, DSA is also developing a scorecard to enable direct sellers to identify where legislators stand on issues related to direct selling, independent contractor status and small business.

That’s A Mouthful is the official blog of Rastelli Direct and is maintained by Andrea Carr of Rastelli Food Group.

That’s a Mouthful is for the aspiring foodie in all of us. At best, this blog will take a stand for the at-home chef, the kitchen crusader and the dining in guru. At the very least, I hope it will make you hungry and inspire you to try something that you may not have experimented with before.

This blog is powered by my personal experiences working for Rastelli Foods Group. The recipes are developed using our products and are often inspired by my time spent cooking for myself and (because I am a recent South Jersey transplant) using my co-workers as guinea pigs! The recipes are created on the fly or recreated after a delicious dining out experience that simply must be recreated at home. Inspiration comes from travel, family, nature and my oddly and extremely detailed dreams that, for no good reason, often include meal prep!

Everyone who visits this site is invited to share, comment and talk with their mouth full. Make no apologies for it!

Millennials Breaking Free of Corporate America (Source CNN Money)

Network Marketers take note: More than half of the nation’s Millennials are looking to break free from the bonds of Corporate America and start their own businesses.

For several reasons, many members of Generation-Y are looking to quit their full-time jobs and start out on their own. Here are five millennials who have successfully done just that.

Maybe they don’t see much room for promotion where they are, maybe it’s because they are sick of corporate politics, or maybe they just can’t stand their boss. Whatever the reason, many members of Generation-Y are looking to quit their full-time jobs and start out on their own.

Fifty-four percent of the nation’s millennials either want to start a business or already have started one, according to a study published last year by the Kauffman Foundation. And, according to a survey by Employers Insurance, 46% of Gen-Y wants to start a business in the next five years, while 35% of Gen-X and only 21% of baby boomers do.

The younger set is gaining experience and contacts at major firms and then using that to take a leap into entrepreneurship. Corporations, on the other hand, are starting to embrace entrepreneurship in a big way. A recent study by my company, Millennial Branding, shows that nearly one third of employers are looking for entrepreneurship experience when hiring recent college graduates. In fact, some companies would rather hire an unsuccessful entrepreneur than a student with multiple internships on his resume.

Here are five millennials who decided to break free from Corporate America and launch their own businesses.

About the author: Dan Schawbel is the managing partner of Millennial Branding, a Gen Y research-and-management-consulting firm.

The brief’s key findings are:

Working longer is the key to financial security, but it does not mean working forever.

Half of today’s households are ready to retire at age 65, but more than 85 percent would be prepared by age 70.

Thus, five years of additional work would solve the problem for the bulk of the population.

(Download Full Brief)

Jon Bon Jovi Joins Avon In Launching The Upcoming Fragrances “Unplugged” For Him And For Her

NEW YORK, July 2, 2012 /PRNewswire/ — Avon Products, Inc. today announced that Jon Bon Jovi will serve as the face of “Unplugged” fragrances for him and for her, two new scents that exude passion, soulfulness and intensity. The partnership unites a rock icon and a major force in beauty, both of whom are dedicated to charitable efforts.

Jon Bon Jovi Unplugged

South Africa DSA

Direct Selling Association of South Africa celebrates 40 years of job creation

To mark its 40th anniversary and 40 years of job creation, the DSA South Africa held a spectacular celebration event in May with over 400 industry guests.

Guest of honour was former Defence Minister Lindiwe Sisulu – now Minister of Public Service and Administration – who said that direct selling has the potential to dramatically impact on unemployment levels in South Africa by creating thousands of jobs for youth and women. The low barrier of entry into the industry enabled people without education to engage in the economy and, through enthusiasm and hard work, earn enough to sustain themselves and pay for their children’s university education.

The DSA is a national business association founded in 1972 representing direct selling companies that distribute goods and services through Direct Sellers directly to consumers in a face to face manner away from a fixed retail location. The term “direct selling” encompasses companies involved in Classical Direct Selling, Multi-Level Marketing, Network Marketing and Referral Marketing.

Canada DSA

PROFILE OF DIRECT SELLERS
91% are women
75% are married
58.5% have some post-secondary education
earn on average between $350 – $700/month
91% have given to charity annually

ECONOMIC / COMMUNITY IMPACT
The direct sales labor pool — more than 2,800 permanent employees and more than 882,000 direct sellers — represents a significant economic impact in Canada. In a recent SocioEconomic Impact Study conducted by Mi3 Solutions Inc. on behalf of the DSA, it was estimated that, in addition to $792 million in direct revenue, $564 million – streams from indirect contributions of the direct selling industry, the spinoff as it buys from other Canadian companies (e.g. suppliers of merchandise, office supplies, shipping, etc.).

All this income helps to stimulate consumer spending. And, the combined contribution of additional tax payments was estimated at $815 million in 2008. When asked if they contribute money, goods or services to social programs, 91% of respondents said they contributed to human services and charities (compared to a national average of 85%.) In addition, direct sellers donated approximately $7.7 million to charitable causes in 2008.

Download Full Report!

Tupperware is trendy again as recession-hit UK turns to direct selling

Thousands of people, including TV chef Jamie Oliver, are rushing to join the boom in direct home selling parties

Shopping parties used to be the preserve of Tupperware containers and risqué lingerie, but they are making a comeback as a new breed of upmarket retailers target the lucrative home-selling market.

From Jamie Oliver’s antipasti platters to Stella & Dot beads and trendy Swedish clothing brand Me&I, thousands of parties are going on around the country every night of the week. The Direct Selling Association (DSA) says “party” sales have surged 120% in the past two years and now generate annual sales of £400m as they strike a chord with recession-weary Britons.

“The rise in popularity of party-based selling is connected to the current economic climate,” says DSA director general Paul Southworth, who says 20,000 people have joined the industry’s sales force in that time. “Whereas people might have gone out for dinner or drinks before the recession, direct-selling parties are a cheaper night in socialising with friends and family.”

Read the full article by clicking here!

Fertile environment for women entrepreneurs in India: Study

NEW DELHI: From being treated as a quiet, supportive half of society, women who want to start a business in India now find the country to provide one of the most fertile environments based on indicators such as business confidence, motivation, financing options and other sources of support.

The finding is part of Dell Women’s Global Entrepreneurship Study conducted across 450 women entrepreneurs from US, UK and India commissioned by Dell.

It reveals that 71 per cent of woman entrepreneurs in India have a branding in market for their businesses and eight in every 10 woman entrepreneurs are hiring which indicates an expansion spree in their individual businesses as well as increase in employment opportunities too.

“When I started my business I didn’t even know how to write a business proposal for getting a loan sanctioned. But I was born to be a businesswoman and hence I could reach this stage without looking back,” says Rita Singh, MESCO Steel Group who has been awarded the “Best Woman Entrepreneur of the decade” by FICCI.

Another entrepreneur Ishita Swarup, who owns a shopping portal 99 labels says, “Women have become more experimental and are slowly shedding their inhibitions of taking risk. I frequently meet women who want to start something of their own but are afraid of taking the plunge and always advise them to just make a plan and hit the market. Over thinking should be kept for handling crisis if there are any.”

Read the full article by clicking here!

Money

Direct sellers call on government to recognise role in growth agenda

The Direct Selling Association (DSA) has met with MPs to draw their attention to the industry’s contribution to the economy, in a reception hosted by Conservative MP, Brian Binley, at the House of Commons.

As the country’s largest provider of part-time independent earning, direct selling in the UK generates approximately £2bn in sales every year.

Almost 400,000 people currently sell for companies such as Avon, Kleeneze and The Pampered Chef, and the DSA has called on MPs to recognise the industry’s ability to support people back to work and inspire entrepreneurs.

Paul Southworth, director general of the Direct Selling Association feels confident that the discussion was a success.

He said: “The event was extremely useful in enabling us to discuss the DSA’s priorities with key Members of Parliament and to plan for the future of the industry, an industry which is closely aligned to the government’s current agenda around encouraging new businesses and entrepreneurialism.

“One of the aims of our work with government is to secure greater awareness and recognition of the industry, and last night was a great chance to do that.”

Read the full article by clicking here!

Beachside CEO

MLM News: How Do Six Global Publically Traded MLM Giants Compare Side By Side?

Hakki Ozmorali of TheDirectSellingWorld.com wrote a great article comparing six of the global giants in the direct selling space.  He covers Avon, Herbalife, Nutra, Nu Skin, Oriflame, and Tupperware.

AVON

Avon and Oriflame were the two companies that disappointed their investors the most. Avon’s net sales increased by 7% during the first three quarters in 2011. The growth slowed down in the last quarter to 6% but the situation in unit sales was even worse as there was a 5% decline there.

“Given the current operating environment, the company no longer expects to achieve the stated targets of mid-single digit revenue growth and 50 to 70 basis points of operating margin improvement in 2011. In light of the changing landscape, we are assessing our long-range business plan and are targeting an operational and financial update at an investor meeting in the first quarter of 2012,” said Avon CEO Andrea Jung. Read On…

HERBALIFE

Herbalife’s investors should have been the happiest of all. The company’s quarterly sales was up 30%, and the increase in the ninth-month period was similar: 28.8%. As it was in the previous quarters, the company’s growth came from all over the world, inclusive of mature markets like US. Herbalife achieved 12% growth in North America.

So happy with the results, “Our business has never been stronger,” said Michael O. Johnson, the company’s chairman and CEO. “In the third quarter Herbalife saw the highest volume point growth rate of the past five years as we eclipsed the one-billion volume point mark for the first time in the company’s history.” Read On…

NATURA

Natura’s net sales increase was 9.5% in the first three quarters of the year. The growth in the last quarter was a little lower, at 7.8%. Brazil’s giant reports to have reached 1,131,000 consultants in its home country. The company has an incredible 24.6% share in the Brazilian cosmetics market. Natura has 230,000 consultants in its international operations, still not a small figure! Read On…

NU SKIN

Nu Skin improved its revenue by 9.9% within the first 9 months. Growth accelerated in the last quarter reaching 11.7% as compared to the same period of last year.

Commenting on their results, Truman Hunt, President and CEO said, “Our strong quarterly results fuel our optimism for the future, particularly as we head into our next ageLOC product launch cycle that begins this month. We are also pleased with 14% growth in the number of executive distributors this quarter, as well as with ongoing strength in emerging markets and continued operating margin improvements.” Read On…

ORIFLAME

Like Avon, Oriflame came up with unsatisfactory results. Oriflame’s revenue increase in the 9-month period was only 1% as compared to last year. And the performance in the last quarter was -4% with a decrease in the closing sales force.

CEO Magnus Bransstrom said, “Poor recruitment campaigns (in CIS) in the end of the quarter were clearly disappointing and give us reason to expect a slowing down in sales in the fourth quarter, leading to a short term effect on margins. Consequently, we adjust our full year outlook.” Read On…

TUPPERWARE

Tupperware reported a revenue increase of 16% in the first nine months, missing analysts’ expectations by a small margin. Tupperware’s growth in the last quarter was 15%, too.

Rick Goings, Chairman and CEO, commented, “We are very pleased to have reported strong local currency sales growth for the quarter. Our emerging markets continued to achieve excellent growth rates overall. They comprised 63% of sales in the quarter and delivered a 19% sales increase in local currency, while the established markets were down 3% in local currency.” Read On…