Young Living Reports Best Year Yet with $1 Billion in Annual Sales

Young Living Essential Oils LLC disclosed Tuesday that—for the first time in company history—annual sales topped $1 billion in 2015. The pioneer in essential oil products is one of just nine U.S.-based direct selling companies to reach the billion-dollar benchmark.

“We celebrate this milestone with sincere gratitude to our dedicated members, who work tirelessly to bring the purpose-driven benefits of Young Living to people around the world,” Travis Ogden, COO, said in a statement. “We truly believe Young Living offers unmatched opportunities to make a real difference in the lives of millions.”

Recent steps have pointed to significant growth at the privately held company. Young Living has expanded and renovated its global distribution center, more than doubling shipping capacity and tripling manufacturing capability. In June 2014, the company announced that its global staff had grown to 1,000. Now, that number has surpassed 2,000. In December 2015, Young Living moved its 500 call center employees to a new facility, one that will accommodate the 50 percent increase in staff the department expects in 2016. This year management also plans to open three new markets, upping the total to 17.

D. Gary Young, a pioneer in essential oils, founded Young Living in 1993 and served as CEO until stepping down in November 2015. His wife and co-founder, Mary Young, then took on leadership of the company, equipped with two decades of experience as a Young Living executive. The Lehi, Utah-based company today sells more than 500 essential oils and essential oil-infused products, backed by its Seed to Seal commitment.

“From our humble beginnings until now, these milestones are significant because they demonstrate the power of authenticity and our unwavering commitment to quality,” said Jared Turner, Chief Sales and Marketing Officer. “We will always stay true to our roots while we continue to innovate and lead the essential oil movement.”

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Direct Selling’s Strength in the World’s Billion Dollar Markets

by Andrea Tortora

Direct selling continues to gain ground worldwide, with global retail sales and the total salesforce both reaching record highs in 2014.

The World Federation of Direct Selling Associations (WFDSA) estimates that retail sales rose 6.4 percent to $182.8 billion in 2014, up from $171.8 billion in 2013, with all regions and three-quarters of direct selling countries posting gains. The total salesforce grew by 3.4 percent in 2014 to 99.7 million people, up from 96.5 million in 2013. All of which lights the stage for coming geographic shifts in market dominance.

“The most recent figures highlight the increasing opportunities that direct selling offers,” says WFDSA Chairman Doug DeVos. “Customers seek personalized service and quality products, and direct sellers are able to meet those needs in a way that is convenient and enjoyable. At the same time, people who aspire to earn a little extra or launch a full-time business venture are drawn to direct selling due to its flexibility and pay-for-performance structure.  It’s exciting to see more people, both customers and distributors, enjoying the benefits of direct selling.”

As part of WFDSA’s annual global statistics gathering, data is collected in local currency figures, which are then converted to U.S. dollars using 2014 exchange rates for all years. When comparisons are made to determine year-over-year change, this practice eliminates the impact of currency fluctuation, explains Judy Jones, Market Research Insights Leader at Amway and Chair of the WFDSA Global Research Committee. The 2015 report comes with an expiration date of May 2016, when the next year’s data will be published. For some markets, sales are estimated until the respective country reports its official figures to the WFDSA. At that time, actual data is restated and accounted for the next year.

These most recent figures confirm direct selling’s strength and its ability to keep reaching more people—as sellers and consumers—in all corners of the globe. The industry’s 6.5 percent three-year compound annual growth rate (CAGR) from 2011 to 2014 is evidence of that power.

The Top 5 countries account for 61 percent of all global sales. All but one report a positive CAGR (2011-2014):

  1. United States, 4.9 percent
  2. China, 18.7 percent
  3. Japan, -2.3 percent
  4. Korea, 8.1 percent
  5. Brazil, 6.7 percent

In all, 23 countries posted retail sales from direct selling of $1 billion or more in 2014. That group accounts for 93 percent of global sales from direct selling.

Leading the pack of the Top 5 countries once again is the United States, where the 2014 sales of $34.5 billion set a record and grew by 5.5 percent from the prior year. The U.S. CAGR for 2011 to 2014 is 4.9 percent. There are 18.2 million people who distribute products, up 8.3 percent from 2013. Nearly 75 percent are women, which means 14 million females are building their own businesses.


Overall estimated retail sales rose 6.4 percent to $182.8 billion in 2014, up from $171.8 billion in 2013.


Companies that are members of the U.S. Direct Selling Association (U.S. DSA) employ 55,300 people who are highly trained experts in their field. For example: 3,000 employees are science professionals, including chemists, biologists and engineers.

“Robust salesforce and revenue figures only tell part of the story behind direct selling’s success in the United States and around the world,” says Joseph N. Mariano, President of the U.S. DSA. “Our channel also provides …

Click here to read the full article in Direct Selling News.

Nerium Achieves Sales of $1B in Less Than Four Years

Nerium International today announced it has surpassed $1 billion in cumulative revenue in under four years of business. According to Direct Selling News research, the anti-aging company is one of the industry’s fastest ever to reach the billion-dollar milestone.

The announcement comes on the heels of Nerium’s ranking as the No. 1 consumer products and services company and the No. 12 company overall on this year’s Inc. 500, a list of the fastest-growing private companies in America.

“When we started this company almost four years ago, we knew we had something very special,” Jeff Olson, Nerium Founder and CEO, said in a statement. “That we’ve sold over $1 billion of product in four short years is a testament to the incredible products and opportunities Nerium has to offer. I’m extremely proud of what we’ve accomplished—we’ve changed thousands of lives for the better.”

Dallas-based Nerium launched in August 2011 with just one product in its portfolio. After topping sales of $100 million in its first year, the company began expanding its line of anti-aging products and opening international markets. Nerium now operates in Canada, Mexico and South Korea; however, 95 percent of total sales have come from the U.S.

“Nerium has been on the fast-track for growth since its launch,” said Direct Selling News Publisher and Editor-in-Chief Lauren Lawley Head. “The company is one of the youngest ever to break into the Top 40 of the DSNGlobal 100 list of the world’s largest direct selling companies, was among the fastest-growing of the Global 100 companies last year, with a net sales increase of 84 percent, and was one of only 16 companies to grow by $100 million or more.”

View the full release from Nerium.

Who Will Summit Next?: Reaching $1 Billion

by J.M. Emmert

“Life’s a bit like mountaineering,” said Sir Edmund Hillary. “Never look down.”

It’s what direct sellers do, too—never look down. The direct selling industry is an industry comprising people who seek to achieve things never thought possible, scaling new heights, whether reaching inside oneself to achieve personal goals or driving a company toward what is considered the Mount Everest in direct selling, the $1 billion summit.

But like Hillary, only a few direct selling companies have managed to reach that elite status. In the 159-year history of direct selling in the United States, Avon was the first to achieve the feat in 1972. Amway followed in 1980. In 1996, Mary Kay Inc. and Tupperware both reached $1 billion. In 2004, Nu Skin and Herbalife joined the group. But another nine years passed before the next company, Ambit Energy, reached $1 billion in sales. Many companies are turned back in their efforts to reach that summit. But why? What makes it so difficult?

The simple answer is that growing a company to such an extraordinary level brings with it new challenges, and, like experienced climbers, extraordinary companies know to stop when the footing gets treacherous, even if the summit is close. Because it is an industry focused on people, direct selling companies understand that the welfare of the entire team is more important than putting up numbers. One tragic misstep and the whole team could come tumbling down.

Orville Thompson, CEO of Scentsy and a former chairman of the U.S. Direct Selling Association, once analogized direct selling and the quest to reach $1 billion to scaling Borah Peak in Idaho. At 12,668 feet, Borah Peak, or Mount Borah, is the highest mountain in the state and among the 100 highest summits in the Rocky Mountains. The most popular route to the top of Borah Peak follows the southwest ridge, ascending 5,262 vertical feet from the trailhead in a little more than 3.5 miles. Just prior to reaching the top, climbers encounter Chicken Out Ridge, a thin ridge of rock with steep slopes so intimidating that many abort their summit attempt.

For those chasing after the $1 billion summit in direct selling, the biggest challenge, says Thompson, is simply finding the right path to follow, those “smooth areas worn down by countless others who have blazed trails.” When they reach that direct selling version of Chicken Out Ridge, they must “challenge their skills and test their fears” in the face of new obstacles.

Despite the risks, more companies than ever appear to be chasing the summit. Direct Selling News research has identified 13 U.S. companies with net sales at or approaching the $500 million to $1 billion range and experiencing strong growth. Having as many companies on their way to the $1 billion summit as there are currently at the peak is a testament to the strength of the channel. Here is a closer look at the contenders:

On the Summit Push

ACN
In 2011 ACN posted $550 million in sales, down from the previous year’s $553 million. However, the company came back strong the past two years, achieving $582 million in 2012—a 5.8 percent increase—and $700 million in 2013—a 20.2 percent increase. This June, the telecommunications and essential services company launched in Mexico, the seventh-largest direct selling country and the company’s 24th market.

Stream Energy/Ignite
Stream Energy/Ignite has been camped near the billion-dollar summit for the past four years, breaking the $900 million ceiling in 2010. After two years of down sales, the company came back strong in 2013 with $27 million over the previous year—a 3.2 percent increase—putting it at $867 million. The company has seen continued growth, particularly in Hispanic markets, and has significant expectations for company growth across the board in 2014 and beyond as it diversifies its service offerings, allowing it to sell nationwide.

Thirty-One Gifts
Of the 13 companies, only Thirty-One Gifts uses the party plan method of selling, joining Mary Kay and Tupperware as the only companies in the Top 17 of the Global 100 ranking that employ this sales approach. What makes that especially interesting is that, according to the U.S. Direct Selling Association, the party plan method of selling has decreased 4 percent in each of the past two years, going from a high of 31 percent in 2011 to just 23 percent in 2013. The person-to-person method, on the other hand, accounted for two-thirds of sales in 2013, according to the DSA.

Thirty-One also has made one of the fastest ascents in recent years. The company posted sales of $100 million in 2010 and then climbed to $482 million in 2011, a 382 percent increase. Sales continued to rise in 2012—a 48.9 percent increase to $718 million. In 2013, Thirty-One achieved a 6.2 percent increase, ending the year at $763 million. Its four-year growth rate: 663 percent.

USANA
USANA, which surpassed $100 million in its first six years, has been the steadiest climber in the group over the past few years. It has maintained an average of $67 million in sales growth annually for the past three years—ranging from a 10.6 percent to 12.5 percent increase—to bring it to $718 million. The company reported $182.4 million in sales for the first quarter of 2014, a 7.9 percent increase over the prior year; second quarter results saw a 0.4 percent decrease, with $188.3 million compared to $189.1 million in 2013; and the third quarter saw record sales of $191.9 million, a 10.5 percent increase over the prior-year period of $173.7 million. For the first half of 2014, USANA generated sales and customer growth in nearly every market in which it operates. Strong growth was seen particularly in Mainland China, the Philippines, Singapore and Mexico.

Expectations are that the wellness industry in particular will continue to thrive in the coming years. In a Sept. 29 article on the health and wellness industry’s global performance, Euromonitor International reported that the United States was leading all countries in 2014 with more than $160 billion in sales. The global industry is expected to reach $1 trillion by … Click here to read the rest of the story

The Road to $1 Billion

by J.M. Emmert

DSN Cover, April 2014

When Inc. magazine named Ambit Energy America’s fastest-growing private company in 2010, the then 4-year-old company’s annual revenue already had reached $325 million, making it one of the 40 largest direct selling companies in the world.

A year after the Inc. article appeared, the revenue number had doubled to $664 million. And 24 months later, Ambit did what very few direct selling companies have been able to do: break the billion-dollar barrier.

Hitting $1 billion in revenue is a milestone for any business, and to do so in seven years puts Ambit’s growth on a trajectory in line with some of the most recognizable brands of the past few decades: Apple (six years), Facebook (six years), Amazon (four years), eBay (seven years) and Google (five years).

Technology certainly helped. Co-Founders Jere Thompson Jr. and Chris Chambless have pointed to the company’s data processing technology as a key factor in Ambit’s rapid expansion. And Ambit, like all modern direct sales companies, leverages the connectivity afforded by the Internet as well as social media platforms in its sales strategies.

Yet despite the ubiquitous nature of technology, the billion-dollar milestone remains elusive for many direct sellers. In order to better understand what it takes to break through that barrier, we decided to study some of the members of direct selling’s Billion Dollar Club: six from the United States—Ambit, Amway, Avon, Herbalife, Mary Kay and Nu Skin, as well as Germany’s Vorwerk, Brazil’s Natura and Peru’s Belcorp.

What is it that makes them billion-dollar companies? What do they have that other companies are still trying to learn and to possess? In our review, we identified four key drivers behind the members of the Billion Dollar Club.


Growth Comparison ($0-$1 Billion)


1. They were founded by outstanding leaders.

Which one would you invite to dinner: the visionary, the revolutionary, the dream-builder, the groundbreaker, the risk-taker, the mover, the shaker or the history-maker? In the Billion Dollar Club, you’ll find them all sitting at the table.

Take Amway’s Jay Van Andel and Rich DeVos, for example. Van Andel was a firm believer in and fierce advocate for free enterprise, and DeVos was among the first proponents of teaching distributors to start with believing in themselves.

“We were just two guys from Ada, Michigan, USA, who wanted to have a business of our own,” DeVos says on the company’s website. “We were two kids (it still feels like that sometimes) who were hungry for success and who wanted to give others the chance to be in business for themselves, too.”

The current generation at Amway is building upon that foundation. Co-CEOs Steve Van Andel and Doug DeVos have led the company to record sales growth marked by continued global expansion to more than 100 countries and territories.

Avon offers a similar lesson in the power of strong foundational leadership. As a salesman in the 19th century, David McConnell was far ahead of his time in recognizing that women could be successful sales professionals. Beginning in 1886 with Mrs. P.F.E. Albee, he tapped the power of a female salesforce to go door-to-door extolling the virtues of products from the California Perfume Company, the forerunner of Avon. By 1920, he had built a $1 million business, which adjusted for inflation would be nearly $12 million now.

Today, CEO Sheri McCoy, whom Fortune magazine ranks as among the 50 most powerful women in business, exemplifies McConnell’s vision of building the company for women. She joined the Avon team in April 2012, bringing with her 30 years of experience with Johnson & Johnson, and now leads a $10 billion business with more than 6 million independent sales representatives.

2. They offer distinctive, high-quality products or services.

Having bold, visionary leaders is critical to building a billion-dollar company. So, too, is creating products that bring true value to the marketplace. The club members reviewed here have done just that.

The United States has the largest cosmetics industry in the world, with estimated revenue of nearly $55 billion. Amway, Avon, Mary Kay and Nu Skin are all able to thrive because they continue to be at the forefront of scientific research, developing new products designed to enhance the lives of customers.

Nu Skin, for example, spent more than $46 million on research from 2011 to 2013 and has made several key acquisitions that brought new technology into the company. Its Pharmanex health supplements product line comes from the acquisition of Simi Valley, Calif.-based Generation Health Holdings Inc. in 1998. Since then, Nu Skin has gone on to purchase substantially all of the assets of Madison, Wis.-based LifeGen Technologies LLC in 2011 and Malvern, Pa.-based Nox Technologies Inc. in 2012, which added more anti-aging technology to the Nu Skin portfolio.

Avon significantly upped its research and development game in 2002, announcing plans for a state-of-the-art R&D center and a $100 million increase in research spending from 2002 to 2005. The company has continued that commitment, spending $67.2 million on research and development in 2013 and launching more than a dozen new products.

Unlike its personal consumer product peers, Ambit is using direct sales to introduce customers to a relatively new product category: energy. Deregulation in many utility markets is giving consumers a choice when it comes to purchasing their retail electric and gas services.

Since its launch in Texas in 2006, Ambit has used direct selling to spread the word. Co-Founder Jere Thompson Jr.’s mother and father were the company’s first customers, and received the first bill. Today, Ambit has more than 1 million active customers.

3. They target growing markets.

In order to hit the $1 billion mark, choosing where to sell can be just as critical as choosing what to sell. Of the nine companies in our report, six of them have a presence in more than 35 markets around the globe. Only Belcorp (16), Natura (seven) and Ambit (one) have managed to make the Billion Dollar Club with less.

According to a September 2013 DSN report, advanced markets—the United States, Japan, Korea, France, Germany, the U.K., Taiwan, Italy, Canada and Australia—accounted for $89 billion in retail sales in 2012. Emerging markets such as China, Brazil, Mexico, Malaysia, Russia, Colombia, Thailand, Venezuela, Argentina, Peru, Indonesia, India and the Philippines accounted for $65 billion. Those markets, however, are home to 85 percent of the world’s population; gaining a foothold there now establishes a foundation for future growth.

Take Brazil, for example. Natura has established itself as the biggest cosmetics company in its home country. The No. 2 cosmetics name in Brazil? That was U.S.-based Avon, which counts Brazil as one of its largest markets and where it keeps some research and development operations.

4. They invest in their people.

In the end, while leadership can create a desired path, quality products can help establish a business, and new markets can help bring a company’s story to a worldwide audience, it all comes down to the people who say yes to the opportunity to represent the brand.

The nine companies in this report have more than 20 million salespeople combined across the globe. Those salespeople are of every age and ethnicity, with diverse educational backgrounds and diverse reasons for wanting to be an entrepreneur. In fact, according to the U.S. Direct Selling Association, most people who join direct selling come for one of five things: supplemental income, recognition, rewards, social connections or product discounts.

Six of the nine companies currently have more than 1 million salespeople who, for the most part, are compensated on a multi-level structure. The most-frequently used sales method is person-to-person, which accounted for 80 percent of sales in 2012. Vorwerk, Mary Kay and Belcorp employ the party plan method as well.

The founders and leaders of the Billion Dollar Club companies recognize and value the diversity among their salesforces. Family men like Belcorp’s Eduardo Belmont and the brothers Carl and Adolf Vorwerk have shown that fostering a culture of love and respect brings in the greatest returns on investment. Motivators like Herbalife’s Mark Hughes and Natura’s Luis Seabra set out to help people change themselves so they could, in turn, change more lives for the better. And Nu Skin’s Blake Roney, Sandie Tillotson and Steve Lund are among the many philanthropists in direct selling who have reached out a helping hand to those in need.

A key to becoming a billion-dollar company is to have people talking about it. So whether the talk comes from the standpoint of a 150-year-old legacy or a new, spirited startup that has re-energized the industry, happy salespeople translates to happy customers; and happy customers is always a winning formula.


Ambit Recognized by J.D. Power for Customer Satisfaction

J.D. Power

As a result of its annual customer satisfaction survey, J.D. Power and Associates has named Ambit Energy “Highest in Residential Customer Satisfaction with Retail Electric Service in New York.” The Dallas-based energy supplier also received the second-highest ranking in Connecticut. The 2013 Retail Electric Provider Satisfaction Study surveyed more than 14,800 retail electric residential customers of 71 retail electric providers in eight states.

At Ambit’s inception in 2006, co-founders Chris Chambless and Jere Thompson Jr. wrote their vision on a whiteboard: To be the finest, most-respected retail energy provider in America. The company’s dedication to excellence earned it a 642 on J.D. Power’s 1,000-point scale—with high points for price, communications, enrollment/renewal and customer service factors.

In this month’s Top Desk, Chambless provides a look at Ambit’s “Roadmap to $1 Billion”—six key decisions that propelled the company to $1 billion in revenue in just seven years. According to Chambless, the most important decision the company made was “to never sacrifice our integrity for growth.” That commitment has brought Ambit both significant revenue and recognition.

Read more on Ambit’s customer satisfaction ranking.

Avon’s Hello Green Tomorrow Tops $5.5 Million

 

Avon Products Inc. recently announced that the Avon Hello Green Tomorrow project, a global fundraising and mobilization program, has topped $5.5 million since its 2010 launch, including $2 million raised in 2012 alone. Avon has contributed the funds to The Nature Conservancy (TNC) and World Wildlife Fund (WWF) to tackle deforestation in Brazil and Indonesia, which are recognized as two of the most critical “hot spots” for deforestation worldwide.

Hello Green Tomorrow raises funds through the sale of special products in more than 50 countries by Avon Sales Representatives and online on Avon eCommerce sites. The company contributes all proceeds to help restore the Atlantic Forest in Brazil, in partnership with TNC, and the tropical forests of Indonesia, with WWF. These forests are among the most threatened in the world, and are important for mitigating climate change, supporting biodiversity and providing for the health and economic well-being of millions of people.

Avon, the company for women, is a leading global beauty company, with nearly $11 billion in annual revenue. As one of the world’s largest direct sellers, Avon is sold through more than 6 million active independent Avon Sales Representatives in over 100 countries.

Top Desk with Ambit’s Chris Chambless: The Roadmap to $1 Billion

by Chris Chambless, Co-Founder and Chief Marketing Officer, Ambit Energy

Click here to order the July 2013 issue in which this article appeared or click here to download it to your mobile device.


Ambit Energy began its seventh year of operation this past March by celebrating the completion of a goal we set at our launch in 2006; we passed $1 billion in annual revenue. Naturally, our rapid growth garnered the attention of our colleagues within the direct selling industry, but I think it surprised our competitors in the energy industry. Now, when I discuss Ambit’s success with my industry peers, what I find surprises them even more is how we did it.

It’s usually the first question I am asked at a conference or event: How did Ambit get to a billion dollars in sales in only seven years? I don’t think people actually expect me to tell them, but I do. And when I give them the list of the six decisions my co-founder and I made before we had a single customer, they often walk away with a puzzled look on their faces. Here they are:

Be the Finest, Most-Respected

During our first planning session in a conference room we were borrowing from his brother, my partner wrote our vision on the whiteboard: To be the finest, most-respected retail energy provider in America. After agreeing to make that our foremost objective, the next five decisions were easy.

Know Who You Are

My co-founder, Jere Thompson Jr., had finance and operations experience. Our CIO, John Burke, was an expert at building customer-care and billing systems. Sales and marketing were my expertise. All three of us had come from the telecommunications industry, and none of us had any experience in the energy industry—which turned out to be a good thing because the second decision we made was to be a data-processing company instead.

Chris ChamblessChris Chambless

People scratch their heads when we tell them that, but it has made all the difference and is a key reason we have grown so rapidly. Consider the fact that we have no products. We sell electricity and natural gas, so we don’t need to store, manage or ship inventory from a warehouse. We utilize a direct sales model to attract customers, but all our orders are submitted online. So we live and breathe data.


We utilize a direct sales model to attract customers, but all our orders are submitted online. So we live and breathe data.


We decided to become experts at managing, transmitting, storing, sharing and crunching data. This dictated that we create an in-house IT team to build our own systems from scratch without relying on vendors to do the work for us. Keep in mind, this cost more and took longer than we had planned, while we continued to fall further and further behind our competition.

Today, our IT systems—we call them BlueNet because our CIO was faster at building them than our CMO was at naming them—are the envy of the energy industry and have their own patent. They have also allowed us to expand rapidly into new markets.

Knock Down Your Walls

The third decision we made focused on our corporate culture. We wanted an open, inviting atmosphere that encouraged accountability and fun. So before we had a single customer, we leased 22,000 square feet in a warehouse in the West End of downtown Dallas and tore down all the walls. In one corner, we set up six $19 foldout tables from Wal-Mart, which our executives—including me and Jere—still sit at today.

We didn’t lease elegant office furniture or create a corporate façade. We put our money into people, systems and commissions and let the empty warehouse scare off everyone who didn’t get the difference between surface and substance. The smart ones got it, and today we have over 650 exceptionally talented employees and an army of enthusiastic Independent Consultants moving us forward.

Get the 2013 DSN Global 100 Annual Report with our new mobile app.

Define Your Targets and Align Your Incentives

The fourth decision we made keeps the entire organization focused on what matters most. The two most important metrics in our company have been, and continue to be, our daily average Consultant enrollments and customer enrollments.

Everything we do internally to reward employees ties back to one of these two numbers. Any project that requires a capital expenditure or human resources must first be measured by how it will impact new customer enrollments or Consultant enrollments. If it won’t then we don’t.

Every commission or bonus we pay externally to an Independent Consultant is earned for doing one of two things: enrolling a personal energy customer or helping a new Consultant they sponsor to do the same thing. No other activity generates compensation, and everyone in the downline is paid for the same thing.

Challenge Conventional Wisdom

The fifth decision we made as founders was to never be restricted by what other people said we should or should not do. At heart we are entrepreneurs, and we decided early on that we would test any idea to see if it had merit. Here are a few of the winners:

    • People in the direct selling industry told us we couldn’t advertise our service directly to consumers because it would alienate our sales channel. We believed we could increase our Consultants’ effectiveness by creating name recognition through mass media. Our first test increased Consultant sales by 35 percent in the markets where we advertised.
    • People in the energy industry told us we couldn’t guarantee our customers a savings and generate a profit. We rolled out our Guaranteed Savings plan in New York in 2007 and have been sending our annual savings letters to customers ever since.
  • People also told us not to focus on trying to get referrals from our customers. It’s too complicated, they said. Today, over 10 percent of our sales come through one of our customers’ referral websites as part of our Free Energy program.

My point is a simple one: Trust your instincts and be willing to take a risk. Our business has grown faster as a result.

Click here to get the latest Direct Selling News on your mobile device.

Never Sacrifice Integrity for Growth


The two most important metrics in our company have been, and continue to be, our daily average Consultant enrollments and customer enrollments.


Finally, the most important decision we made before we launched Ambit was to never sacrifice our integrity for growth. The thing that surprises people most is when I tell them we could have grown even faster than we have.

We could have looked the other way and allowed our field leaders to exaggerate their incomes in the early days when there was more belief than proof, but we didn’t.

We could have allowed commissions to flow faster by reducing the number of non-Consultant sales required to trigger them, but we wouldn’t.

We could have sat by silently when we identified Consultants who were taking shortcuts during the sales process when no one would have known otherwise, but we refused to.


Trust your instincts and be willing to take a risk. Our business has grown faster as a result.


A business built on gimmicks, shortcuts and exaggeration is not sustainable. The very growth those things create ultimately collapses the weak foundation it was built on.

We believe that the only way to succeed in business is to work hard, do the right thing and hold everyone to a high standard. It’s harder. It’s slower. But in the long run it’s more than worth it.

NuSkin China Expands as Sales Approach $1 Billion

Nu Skin

NuSkin Enterprises, the No. 8 direct selling company in the world, forecasts that its China market sales will top $1 billion this year, ahead of the 2014 target set by the company back in 2009.

Aspiring to five-fold growth over the next five years, NuSkin is currently investing over $50 million into its Greater China Innovation Park in Shanghai. The Greater China facility will be NuSkin’s first regional headquarters outside the United States. With its over-60 population projected to increase from 14 to 25 percent over the next twenty years, China will continue to represent a prime market for the anti-aging products manufacturer.

Read the full story here.

Ambit: Powering the Path to a Billion-Dollar Company

by Jeremy Gregg

Ambit

Company Profile

Founded: 2006
Headquarters: Dallas, Texas
Founders: CEO Jere Thompson, Jr. and Chief Marketing Officer Chris Chambless
Products: Electricity and natural gas
Markets: California, Connecticut, Illinois, Maryland, Massachusetts, New Jersey, New York, Pennsylvania, Texas and Washington, D.C.


In early 2006, two Dallas natives began talking to their friends about ways to capitalize on the growing opportunities presented by energy deregulation in Texas. While they did not know it at the time, those two men—Jere Thompson, Jr. and Chris Chambless—would soon become the founders of the fastest-growing retail energy company in the world.

Four years earlier, at precisely midnight on Jan. 1, 2002, Texas had opened its electricity markets to retail competition for the first time. After experiencing a number of hiccups and setbacks, including several consumer lawsuits that caused what the Texas Coalition for Affordable Power described as a “crisis of confidence,” the market was beginning to stabilize by 2006.

With a common background in the telecom industry, both Thompson and Chambless believed that there was an opportunity to apply the discipline, systems and expertise of that industry to the retail energy market.

Humble Beginnings


{ Ambit means “one’s circle or scope of influence.” }


Introduced through a mutual acquaintance, the two men met for the first time at a sandwich shop in Addison, Texas, for a friendly chat about energy deregulation. Over turkey sandwiches, Thompson and Chambless became so excited about the synergy between their ideas that they resolved that day to begin building “the finest and most-respected retail energy company in America.”

From the very beginning, they wanted to leverage the power of the direct sales model to build their company. In fact, they even decided to name their company Ambit, which means “one’s circle or scope of influence.”

Prior to co-founding Ambit, Chambless had been hired as only the 52nd employee at Excel Communications. Describing the experience as “drinking from a fire hose,” he explains that is where he learned the direct selling business as he helped Excel to reach $1 billion in annual sales in a little over six years.

“I learned the importance of great IT systems, how to incent and motivate independent entrepreneurs and, more importantly, I learned what doesn’t work. All of that was great preparation for starting Ambit,” he explains.

Immediately after they met, the co-founders borrowed office space from Thompson’s brother and went to work. A few weeks later, they moved into a large, renovated warehouse in the historic West End district of downtown Dallas.

As their website explains: “The expansive office space suited their needs perfectly—helping to establish a feeling of ‘openness’ and enabling faster communication. As a way to reduce costs and preserve capital, they bought several $19 fold-up tables to use as desks and put together a team of experienced executives who shared their vision. Ambit executives continue to use these same tables to keep that spirit and commitment alive today.”

That August, Ambit shipped its first New Consultant Kits to the “Founding Four” consultants. Today, there are more than 200,000 independent consultants driving sales to more than 1 million customers each month.

While it is now the fastest-growing company in the retail energy sector, Ambit has retained its roots in those humble beginnings. This is perhaps best represented by the official corporate motto that Chambless and Thompson developed the day that they met: “Never sacrifice integrity for growth.”

“On our first day working together, Chris and I sat down and talked about what kind of company we wanted to build,” says Thompson. “There are some great companies in this industry and there are others who have been poor operators who have given the industry an undeserved reputation. We wanted our company to be one of the great examples and we wanted to make our families proud of our accomplishments. We decided that motto would be something that our employees could use as a guide when we weren’t there to help make a decision for them.”


In 2010, Ambit had reached $415 million in revenue. The next year, the firm posted $664 million. That number grew a whopping 40 percent in 2012 to over $930 million.


That attitude has obviously not stunted Ambit’s growth. In 2010, Ambit had reached $415 million in revenue. The next year, the firm posted $664 million. That number grew a whopping 40 percent in 2012 to over $930 million—and the company’s trailing 12-month revenue passed $1 billion in March 2013.


Ambit’s open environment fosters communication.Ambit’s open environment fosters communication. The Wall of Fame highlights consultant achievements.The Wall of Fame highlights consultant achievements. Ambit’s motto is prominently displayed at its headquarters. Ambit’s motto is prominently displayed at its headquarters.

The Key to Ambit’s Growth

“Jere and I both came from the telecom industry and so I think our experience there led us to look at this opportunity differently than many of our competitors. We never considered ourselves an energy company or a direct selling company. We considered ourselves a data processing company,” says Chambless.

“We sell energy and we use direct selling as the channel to acquire customers, but at our core we store, manage and share data. In telecom, we saw companies with great systems prosper and grow and we saw companies with inferior systems wither and fade. We compete now with many energy companies and several direct selling companies, but I’m not sure we are competing with any data processing companies.”

Entering its seventh year, Ambit Energy is poised to be the first direct selling energy company in history to reach a billion dollars in revenue. The company provides electricity and natural gas services in deregulated markets across the United States.

Ambit’s website describes the company as a “Top Electricity and Gas Provider.” But Chambless, who graduated from college with an English degree, defines the company as far more than simply its product offering.

“Ambit is thousands of individual dreams powered by a single vision: to be the finest, most-respected retail energy provider in America,” he says. “In that way, the opportunity to help customers in our markets across the country save money on their monthly energy expenses is also a vehicle for our independent consultants to achieve their financial goals. Their passion for achieving those goals is what is making Ambit such a tremendous growth story.”

Thanks to the strength of these 200,000+ consultants, Ambit now powers over 1 million homes in the markets of California, Connecticut, Illinois, Maryland, Massachusetts, New Jersey, New York, Pennsylvania, Texas and Washington, D.C.

Ambit Energy Today

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Two years after Chambless and Thompson—now Chief Marketing Officer and CEO, respectively—ate their first turkey sandwiches together, Ambit Energy recorded revenues of almost $200 million. By the end of 2009, annual revenues had increased to nearly $325 million. As a result of this tremendous growth, Ambit was named the fastest-growing privately held company in North Texas by the highly prestigious Caruth Institute for Entrepreneurship at Southern Methodist University’s Cox School of Business in their annual Dallas 100™ rankings. In 2010, Ambit made the SMU/Cox Dallas 100™ for the second year in a row, and was also listed among the Top 100 Places to Work by The Dallas Morning News.

And yet the greatest recognition came later that year, when Inc. magazine named Ambit “America’s No. 1 Fastest-Growing Private Company.” Before it had turned 5 years old, Ambit had captured one of the most respected titles in the entire business world—driven by the power of the direct selling model. 2012 marked the third year in a row that Ambit ranked on the Inc.500|5000 list of “America’s Fastest-Growing Private Companies.”

“I love the direct selling industry. I think it’s one of the last bastions of capitalism still accessible to the average person,” Chambless says.


“I love the direct selling industry. I think it’s one of the last bastions of capitalism still accessible to the average person.”
—Chris Chambless, Co-Founder and Chief Marketing Officer


Eric Johnstone, Ambit’s Vice President of Marketing and Field Services, is similarly passionate about the impact of the direct selling model on Ambit’s future: “The great thing about the Ambit Opportunity is that it is truly an opportunity for everyone. We sell a service that everyone needs and uses every month. You don’t have to be a professional salesperson or need to learn a lot about the benefits of a product. For that reason, our consultants come from all walks of life—doctors, teachers, real estate agents, engineers, stay-at-home moms, retirees, people who were formerly unemployed—anyone who is looking for a vehicle to earn extra income with the goal of reaching financial freedom.

“Our business presentations focus on those individuals who want to earn a little extra residual income every month,” Johnstone continues. “And we have a number of people who are earning enough to pay off debt, save for retirement, or plan for their children’s education. Those consultants who are most successful are those who have a strong ‘why’—they make the commitment and work at it.”

Ambit’s consultants pay a one-time fee to start their business (there is no annual renewal fee). This fee provides them with access to Ambit’s back office business management system called “PowerZone,” as well as the business-building kit that Ambit sends out to new consultants.

Johnston explains that Ambit’s approach is different than some direct selling companies because “electricity and natural gas are products that everyone uses. So, we train our consultants to gather customers by asking people they know to be their customers. A consultant only needs 20 personal customers to qualify for all commission levels, so we teach them to find good, loyal customers who will stay with their business.”

Given its reliance on online videos for both recruiting and training, Ambit also maintains a very strong presence on all major social media platforms. The firm even has a dedicated social media group to maximize the online experience for Ambit’s consultants and to keep them informed about news from the corporate office.

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Ambit’s Operational Innovations

Chambless believes that one of the key factors to the company’s ability to manage such rapid growth is its exceptional technology. These tools have equipped Ambit and its leadership to handle the unique challenges presented by rapid growth within an emerging industry.

For example, Ambit’s IT team has created a custom, patented Customer Care and billing platform from the ground up called BlueNet®, which the team says has provided a competitive edge for the company. The technology manages all aspects of the customer life-cycle—from utility transactions between customers and transmission providers to web-based account management and billing tasks.


“PowerZone is our consultants’ back office business management system where they can track their commissions, find a local business presentation [and] track their customers and downline organization.”
—Eric Johnstone, Vice President of Marketing and Field Services


Additionally, Ambit’s leaders pride themselves on their firm’s exceptional, U.S.-based Customer Care Center, in which a highly trained American staff is equipped to handle all customer relationships. For the independent consultants, Johnstone explains that Ambit has gone to great lengths to make its program accessible and manageable for everyday people: “PowerZone is our consultants’ back office business management system where they can track their commissions, find a local business presentation, track their customers and downline organization, and get the latest news and information from corporate. PowerZone also includes Ambit University, which includes a suite of training videos from corporate staff and some of our top income earners. There are also scripts and market-specific information they can download.”

Johnstone continues, “When a consultant sponsors a new consultant, the first place they typically send that new consultant is to Ambit U to watch the training videos. We also send out a business-building kit and a series of training emails to our new consultants during their first week in the business to reinforce what they learn in the videos.”

In addition to relying on technology, Ambit also sponsors a number of live training events throughout the year. This includes a simulcast broadcast at the first of the year, which is shown via satellite to a number of Ambit’s markets across the country. Johnstone explains that “each market has a live component that beams back to the other locations. This past January, we broadcast to 10 different markets. The day includes training, motivation and the latest information from corporate.”

Ambit offers its premier event every September in Dallas, called Ambition. This three-day event includes a Thursday and Friday dedicated to training consultants on new tools and personal development. The event culminates on a Saturday with recognition, announcements, messages from the co-founders and premium guest speakers.

Celebrating Success

Ambit has developed some very high-impact forms of recognition that have motivated both top-performers as well as consultants who are just looking for some extra income on the side. One of the firm’s signature recognition pieces takes a page from the playbook of the PGA Masters by providing a custom jacket to its most stellar performers.

When a top achiever has earned more than $1 million, he or she becomes a member of “The Millionaire Club”—complete with a tailored yellow sports coat. Those earning over $5 million earn a special purple sports coat. As of January 2013, Ambit has awarded 18 yellow sport coats and three purple ones to this group of very high performers.

These high-profile leaders are an inspiration to other consultants to dream big. The company has also re-introduced their free energy program, where both customers and consultants who refer a minimum of 15 customers to Ambit receive a Free Energy Credit every month, up to their total energy cost.

Figuring out how best to motivate its army of consultants is one of the primary hats that Chambless wears. When asked how he responds when people ask him, “What do you do?” he replies, “It depends on what day you ask me that question. Today, I’m a pricing strategist working on a new idea for a promotion. Tomorrow, I have to speak at an Ambit event and I’ll be a cheerleader. But at a high level, I’m responsible for two things: eliminating any excuse for our consultants to fail by providing them with all the tools and training they need to be successful, and teaching them all to tell our story.”

As they look past $1 billion in revenue this year, Thompson and Chambless see no reason why the company will slow down.

“The deregulated energy industry is huge and I think we have barely scratched the surface of the opportunity to gain market share,” says Thompson. “There is a large population of customers in these markets who are largely unaware that they have the right to choose a new provider and save money. Our model is perfectly designed to solve that problem.


“Never sacrifice integrity for growth. We could have grown even faster if we had been willing to take more risk, but that would not have been consistent with our values.”
—Jere Thompson, Co-Founder and CEO


“I think the Internet and social media are also making it easier for people to share information and build large networks. So, from a technology standpoint I see tremendous opportunity.”

And yet, despite their success, Thompson remains grounded in his corporate motto’s standard to “Never sacrifice integrity for growth.” He says, “We could have grown even faster if we had been willing to take more risk, but that would not have been consistent with our values.”


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