Are We Winning?

by John Fleming

Click here to order the February 2015 issue in which this article appeared or click here to download it to your mobile device.


It’s hard to keep a scorecard on the direct selling industry! Those who tend to look for a way to criticize can always find something. Those of us who see within the industry and have the opportunity to interact with industry decision makers gain much insight and perspective. And this is a time of year to reflect. The corporate scorecard will be the year-end financial statements that will recap the business of the previous year. Businesses will win or lose depending upon the bottom-line numbers of profit or loss and the top-line number of revenue generated in comparison to the prior measurement period. But the question for those of us affiliated with the direct selling industry might be: What is the industry scorecard? Are we winning or are we losing?

Some scorekeepers like Bill Ackman, the hedge fund manager who has specifically targeted Herbalife with venomous attacks on the company’s method of conducting business (direct sales), completes his scorecard based on a set of very personal criteria that leads to an accusation and attack on, in this case, Herbalife in particular. However, this type of scorecard has implications for the entire industry. Direct selling, as a channel of distribution, is executed in many different ways, from what we often refer to as party plan to network marketing, social entrepreneurship, social selling, and social commerce, or even simply person to person. Today, the actual definition of direct selling is so very broad that direct sellers utilize online methods for delivering messages and transacting business as effectively as any channel of distribution.

In response to a scorekeeper like Bill Ackman and his staff, we remind such scorekeepers of the fact that the industry has a formal code of ethics as well as an informal code of ethics. The industry code and the more stringent company codes of ethics serve to govern the manner in which those who utilize the direct selling channel engage both employees of the company and the independent brand partners representing the company’s products, services and business opportunity. Independent contractors are also consumers as it simply makes sense to be your own best customer.


Today, the actual definition of direct selling is so very broad that direct sellers utilize online methods for delivering messages and transacting business as effectively as any channel of distribution.


The formal Code of Ethics is provided by the U.S. Direct Selling Association, and this code is public information. Members of the U.S. DSA pledge to abide by the U.S. DSA Code of Ethics. Many non-members of the U.S. DSA (direct selling companies) have created their own company codes and often use the DSA Code of Ethics as their benchmark. In either case, the direct selling industry overall has done a good job of policing itself and has grown as a channel of distribution to over $30 billion in U.S. revenue and $150 billion in worldwide revenue, generated by approximately 16 million U.S. independent contractors and 90 million worldwide independent contractors.

Every organization and every business has some type of scorecard for reflection on previous-year results and the planning of the new year. It is part of our nature to desire a scorecard to determine if we are winning or losing. Each winter, the NFL hosts the ultimate scorecard in professional football, the Super Bowl, where thousands will witness the final score that determines the best football team of the year. The same process holds true for all professional sports teams and leagues wherever they are located in the world. Hundreds of millions watch these events on television.

Direct Selling News created a scorecard for the direct selling industry when we first published the Direct Selling News Global 100 listing in 2009. Each year, this enormous research project serves to identify the top 100 direct selling companies in the world who certify their revenue performance by submitting the DSN Revenue Certification Form and complete a profile of their company. This process results in the publishing of perhaps the most important scorecard on the industry issued by anyone.

However, there is more to score on a company-by-company basis, and we offer on this page a potential scorecard profile that we believe tells even more of the story about an industry that shows such diversity in its representation of people from all walks of life. Direct selling as a method of distribution provides people with hope and with training to learn the basic knowledge and skills to be able to build a business. This could be a small part-time effort or a more serious effort that not only develops customers but also provides the opportunity to recruit and train others to do this, resulting in a much larger business opportunity. Because a scorecard is so important, we encourage each direct selling company to submit your Global 100 information and profile, as in so doing you participate in a valid process for scoring an incredible industry.

In going through the scoring process, we remain optimistic that we will have experienced another year of overall growth with respect to the first two categories on the scorecard pictured. Within the growth, there will always be those companies that did not grow, and the reasons for that are many, some of which are mentioned below and are also being researched by Direct Selling News.

Continue to Direct Selling News to see the scorecard and find out if we are winning or not.

 

 

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90 Days of Direct Selling – Day 86

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YOFOTO (China) Health Industry Co. Ltd.

2013 Net Sales: $428 million

Country: China

YOFOTO delivers healthcare products in traditional Chinese medicine as well as the health preservation culture of traditional Chinese medicine to the world and brings global marketing partners a healthy life and good career opportunities.

 

2012 Rank: N/A
2012 Net Sales: N/A
Sales Method: Person-to-person
Compensation Structure: Multi-level
Products: Wellness
Markets: 2
Salespeople: Not available
Employees: Not available
Headquarters: Zhejiang Province, China
Executive: Huang Jinbao
Year Founded: 2004
Website: www.yofoto.net

 

90 Days of Direct Selling – Day 85

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WorldVentures

2013 Net Sales: $195 million

Country: USA

WorldVentures is a social commerce, peer-to-peer company that sells vacation and experience club memberships. It combines the power of the Internet with the strength of the direct selling industry to market its DreamTrips Memberships. WorldVentures has active representatives and members in 26 countries.

 

2012 Rank: 75
2012 Net Sales: $143 million
Sales Method: Person-to-person
Compensation Structure: Multi-level
Products: Travel packages
Markets: Not available
Salespeople: Not available
Employees: 190
Headquarters: Plano, Texas
Executives: Mike Azcue and Wayne Nugent
Year Founded: 2005
Website: www.worldventures.com

 


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 Yanbal International

2013 Net Sales: $848 million

Country: Peru

Yanbal International is much more than a cosmetics company. It is a vibrant corporation that changes the lives of almost half a million people who share beauty, prosperity and well-being. With a presence in 10 countries and renowned for its world-class products, Yanbal is still growing, achieving a positive and real impact in the lives of people.

 

2012 Rank: 17
2012 Net Sales: $815 million
Sales Method: Person-to-person
Compensation Structure: Multi-level
Products: Cosmetics, personal care, skin care, jewelry, fragrances
Markets: 10
Salespeople: 390,000
Employees: 6,100
Headquarters: Lima, Peru
Executive: Janine Belmont Dauelsberg
Year Founded: 1967
Website: www.yanbal.com

 

90 Days of Direct Selling – Day 84

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Vision International People Group

2013 Net Sales: $96 million

Country: Cyprus

Vision International People Group is a global networking community that offers a wide range of high-quality, effective and natural healthcare products aimed at increasing well-being around the world. Since the foundation of the company in 1996, it has been directing its efforts to creating a new culture of health. The company’s philosophy is based on the Whole Health Option (WHO), claiming health to be the highest value of any human being and that health is the harmony between a person’s physical state, spiritual welfare, intellectual purposefulness and social equity, which can be obtained by leading a high quality of life.

 

2012 Rank: 91
2012 Net Sales: $95 million
Sales Method: Person-to-person
Compensation Structure: Multi-level
Products: Wellness
Markets: 20
Salespeople: 150,000
Employees: 430
Headquarters: Nicosia, Cyprus
Executive: Dmitry Buriak
Year Founded: 1996
Website: http://www.vipgroup.net

 


 

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Vorwerk & Co. KG

2013 Net Sales: $3.70 billion

Country: Germany

Vorwerk is a family-owned, Germany-based company that has been focusing on the direct sales channel since 1930. Products include household appliances as well as high-quality cosmetics. Vorwerk & Co. KG is a global group that includes JAFRA Cosmetics, which reported sales volume of $612.5 million.

 

2012 Rank: 4
2012 Net Sales: $3.3 billion
Sales Method: Person-to-person and party plan
Compensation Structure: Multi-level
Products: Cosmetics, household appliances, home care
Markets: 76
Salespeople: 620,000
Employees: 12,000
Headquarters: Wuppertal, Germany
Executives: Walter Muyres, Reiner Strecker and Frank van Oers
Year Founded: 1883
Website: http://www.vorwerk.com

 

90 Days of Direct Selling – Day 83

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Vemma Nutrition Co.

2013 Net Sales: $221 million

Country: USA

Vemma is rapidly growing as one of the premier industry leaders specializing in premium liquid nutrition. Every month, thousands of new customers experience the positive difference of the clinically studied Vemma formula. The Vemma brands include Verve, a healthy energy drink, and Bod-e, a weight-loss line.

 

2012 Rank: 81
2012 Net Sales: $117 million
Sales Method: Person-to-person
Compensation Structure: Multi-level
Products: Wellness, food and beverage
Markets: 49
Salespeople: 105,251
Employees: 200
Headquarters: Tempe, Arizona
Executive: BK Boreyko
Year Founded: 2004
Website: www.vemma.com

 


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Viridian Energy

2013 Net Sales: $267 million

Country: USA

Viridian is a socially responsible energy company offering customers the opportunity to make a difference by choosing affordable, alternative clean energy solutions for their homes and businesses.

 

2012 Rank: 63
2012 Net Sales: $182 million
Sales Method: Person-to-person
Compensation Structure: Multi-level
Products: Energy
Markets: 1
Salespeople: 22,065
Employees: 206
Headquarters: Stamford, Connecticut
Executives: Michael Fallquist and Meredith Berkich
Year Founded: 2009
Website: www.viridian.com

 

90 Days of Direct Selling – Day 82

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USANA Health Sciences Inc.

2013 Net Sales: $718 million

Country: USA

USANA Health Sciences develops and provides the highest-quality science-based health products distributed internationally through direct selling, creating a rewarding financial opportunity for independent associates, shareholders and employees.

 

2012 Rank: 20
2012 Net Sales: $649 million
Sales Method: Person-to-person
Compensation Structure: Multi-level
Products: Wellness
Markets: 19
Salespeople: 265,000
Employees: 1,426
Headquarters: Salt Lake City, Utah
Executive: David Wentz
Year Founded: 1992
Stock Symbol: USNA—NYSE
Website: http://www.usana.com

90 Days of Direct Selling – Day 81

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Tupperware Brands Corp.

2013 Net Sales: $2.67 billion

Country: USA

Tupperware is a global direct seller of innovative, premium products across multiple brands and categories through an independent salesforce. Products include design-centric preparation, storage and serving solutions for the kitchen, and home as well as beauty and personal-care products.

 

2012 Rank: 7
2012 Net Sales: $2.6 billion
Sales Method: Person-to-person and party plan
Compensation Structure: Single-level and multi-level
Products: Storage and serving, beauty, personal care
Markets: 100
Salespeople: 2.6 million
Employees: 13,500
Headquarters: Orlando, Florida
Executive: Rick Goings
Year Founded: 1946
Stock Symbol: TUP—NYSE
Website: www.tupperware.com

 


 

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Univera

2013 Net Sales: $118 million

Country: USA

Univera is a premier natural products company offering vitality, prosperity and purpose to people around the world.

 

2012 Rank: 79
2012 Net Sales: $121 million
Sales Method: Person-to-person
Compensation Structure: Multi-level
Products: Cosmetics, personal care, food and beverage, wellness
Markets: 3
Salespeople: 50,564
Employees: 190
Headquarters: Seattle, Washington
Executive: Bill Lee
Year Founded: 1976
Website: http://www.univera.com

90 Days of Direct Selling – Day 79

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Team National Inc.

2013 Net Sales: $332 million

Country: USA

Team National provides membership savings on products and services in more than 20 industries, including factory direct pricing on home furnishings and more.

 

2012 Rank: 43
2012 Net Sales: $301 million
Sales Method: Person-to-person
Compensation Structure: Multi-level
Products: Clothing and accessories, cosmetics and personal care, food and beverage, home décor, kitchenware and appliances, services, wellness
Markets: 1
Salespeople: 390,000
Employees: 53
Headquarters: Davie, Florida
Executive: Angela Loehr Chrysler
Year Founded: 1997
Website: http://www.bign.com

 

 

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Telecom Plus

2013 Net Sales: $1.10 billion

Country: United Kingdom

Operating primarily as the Utility Warehouse Discount Club, Telecom Plus provides landline phone, broadband, mobile phone, gas and electricity products and services to over 500,000 customers across the UK, as well as offering club members a range of opportunities to save money on other household expenses.

 

2012 Rank: 15
2012 Net Sales: $892 million
Sales Method: Person-to-person
Compensation Structure: Multi-level
Products: Landline phones, broadband, mobile phones, gas, electricity, cashback card
Markets: 1
Salespeople: 42,500
Employees: 730
Headquarters: London, England
Executive: Andrew Lindsay
Year Founded: 1996
Stock Symbol: TEP—LONDON
Website: www.utilitywarehouse.co.uk

90 Days of Direct Selling – Day 78

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Team Beachbody

2013 Net Sales: $328 million

Country: USA

Team Beachbody is the direct selling division of Beachbody LLC with approximately 150,000 independent Coaches in the United States and Canada helping customers reach their fitness and financial goals. Beachbody in-home fitness and weight-loss solutions include P90X®, P90X2®, P90X3™, FOCUS T25®, 21 Day Fix™, INSANITY® and Turbo Jam®.

 

2012 Rank: 51
2012 Net Sales: $218 million
Sales Method: Person-to-person
Compensation Structure: Multi-level
Products: Wellness
Markets: 2
Salespeople: 140,000
Employees: 600
Headquarters: Santa Monica, California
Executive: Carl Daikeler
Year Founded: 1998
Website: www.beachbody.com

90 Days of Direct Selling – Day 77

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Take Shape For Life

2013 Net Sales: $229 million

Country: USA

Take Shape For Life is a unique program that combines the personalized support of a Health Coach, the Habits of Health, and the clinically proven Medifast Meals. Take Shape For Life is a wholly owned subsidiary of publicly traded Medifast Inc.

 

2012 Rank: 52
2012 Net Sales: $216 million
Sales Method: Person-to-person
Compensation Structure: Multi-level
Products: Wellness
Markets: 1
Salespeople: 16,500
Employees: 550
Headquarters: Owings Mills, Maryland
Executive: Meg Sheetz
Year Founded: 2002
Stock Symbol: MED—NYSE
Website: http://www.tsfl.com