HERBALIFE

Herbalife ended the year with growth records: 1) Highest annual revenue in company history, 2) Largest fourth quarter global sales ever, 3) Best yearly sales in Asia-Pacific, EMEA and North America regions.

Herbalife’s fourth quarter sales was $1.4 billion and this represented 16% revenue growth from previous year’s same quarter. North America posted 33%, EMEA region 31%, Asia-Pacific 14% and South-Central America 10% sales increases. 36 of the EMEA countries came up with double-digit sales growth in the quarter. Among these, some stood out with remarkable results: Italy (34% growth), Spain (54%), France (57%) and the UK (129%).

The two Herbalife regions that reported negative growth in Q4 were China and Mexico.

Chairman and CEO John Agwunobi was very happy with the results, saying, “Simply put, 2020 was an amazing year, the best year ever for Herbalife Nutrition, and a testament to the strength of the company and the resilience of our distribution channel. Although 2020 was a record-setting performance year, I believe the best is still to come.”

With this impressive finish, Herbalife’s 2020 annual sales hit $5.5 billion, up 14% from 2019. This 14% rate of yearly sales increase was Herbalife’s best YOY rate of growth in the last 10 years.

Herbalife management anticipates a further 6% to 14% global sales increase in 2021.

For more on Herbalife’s fourth quarter and 2020 performance, please click here.

NATURA &CO

Natura &Co’s consolidated net revenue in Q4 was R$12 billion (approx. US$ 2.2 billion), up 24.3%. The company reported sales growth in all four of the group’s brands.

Company’s 2020 full year performance was remarkable as well: Consolidated revenue increase was 12%, reaching  R$37 billion (approx. US$ 6.6 billion). Among the group brands, Natura &Co LATAM’s sales increased by  9%, Avon International’s by 3%, The Body Shop’s by 32% and the smallest business unit Aesop’s by 50%.

As was stated by the management, The Body Shop owed much of this success to its “at-home” business (206% sales increase in Q4) and e-commerce (72% increase).

Natura &Co LATAM generates the largest business for the company, accounting for 56% of the group revenue. It is followed by Avon International (25%) and The Body Shop (14%).

Roberto Marques, Executive Chairman and Group CEO of Natura &Co, said: “In a year of unprecedented challenges, Natura &Co associates and our network across all of our businesses showed care and adaptability in the face of a global pandemic, demonstrating both our purpose-driven approach to business and the strength of our omnichannel, multi-brand model. Our performance in the fourth quarter attests to that, with strong growth in sales and profits.”

For more on Natura’s fourth quarter and 2020 performance, please click here.

NU SKIN

Nu Skin reported $748 million revenue for the last quarter of 2020 and $2.6 billion for the whole year. Company’s quarterly growth rate was 28%.

At the regional level, all of the seven regions posted sales increases. Americas/Pacific came up with the highest sales growth in Q4 (83%), followed by EMEA (79%).

“Balanced Geographical Profile” has been emphasized by Nu Skin as a key pillar of company’s overall strategy. In fact, there has been a significant business shift from Nu Skin’s Eastern regions to Western ones in the last five years. You can see the comparison on the below chart:

“Our strong fourth-quarter results were driven by exceptional customer growth of 34% compared to the prior year,” said Ritch Wood, Chief Executive Officer. “The successful Boost and Nutricentials product introductions helped generate 28%revenue and 29% sales leader growth in the quarter.”

While describing the results of the steps taken in digital technology at the investors’ call, management said during Black Friday in EMEA, four months of inventory of “Galvanic Spa” products were sold in just 90 minutes.

Nu Skin’s expectation for 2021 is announced as 5% to 9% revenue increase. The yearly growth was 7% in 2020.

In September this year, Nu Skin will witness a CEO transition. CEO Ritch Wood will retire after a 30-year career with the company. He will be replaced by Ryan Napierski, Nu Skin’s current President. Ryan Napierski has also been with Nu Skin for 25 years.

For more on Nu Skin’s fourth quarter and 2020 performance, please click here.

ORIFLAME

Oriflame, once again, closes a year with declining sales figures. Company’s total revenue decreased to €1.157 billion (approx. US$ 1.4 billion) in 2020 from €1.258 billion in 2019. This represented a drop of 8%. 2020 marks the third consecutive year with declining sales.

Oriflame’s fourth quarter performance was from reversing the negative trend within the year: Global sales decreased by 14% to €307.5m (€357.2m) in Q4.

All five regions of Oriflame reported negative growth in the last quarter: Asia (-19%), Turkey&Africa (-18%), CIS (-16%), Latin America (-14%) and Europe (-2%).

“2020 was a challenging year in many ways… After the first wave of the pandemic in the first half of the year, we experienced a positive sales turnaround in the third quarter that unfortunately was reversed in the fourth quarter. We also faced strong currency head winds negatively impacting our overall sales and margins. In addition, the combination of changed demand and product mix, together with relatively long inventory replenishment lead times, led to product availability challenges and accordingly impacted sales negatively in certain product categories towards the end of the year,” commented CEO Magnus Brännström.

In fact, there was a strong shift in Oriflame’s product mix. Color cosmetics’ share declined from 19% to 15% in Q4, wellness category’s jumped to 17% from 13%.

For more on Oriflame’s fourth quarter and 2020 performance, please click here.

USANA

USANA is among those direct sellers that ended 2020 with quite positive results: 15% sales growth for the last quarter and 7% for the whole year.

In the fourth quarter, all of USANA’s regions contributed to this result: Southeast Asia Pacific +34%,  North Asia 17%, Americas and Europe 14%, and Greater China 5%.

Kevin Guest, CEO and Chairman of the Board said, “Our fourth quarter results were better than expected and cap off a year during which USANA delivered remarkable results despite continued challenges from the pandemic…. As we kick-off 2021, we are confident that we are positioned to deliver another year of solid growth for USANA.”

China is currently USANA’s largest region, generating 47% of company’s global revenue. When asked about plans for international expansion during the investors’ call, Kevin Guest said their strategy for several years had been focusing on existing markets and on growth in those markets. Although they see now international expansion is a potential growth opportunity, it is not the primary strategic growth strategy for the company, he added.

USANA expects  $1.21 – $1.27 billion sales in 2021.

For more on USANA’s fourth quarter and 2020 performance, please click here.

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Hakki Ozmorali is the Founder of WDS Consultancy, a management consulting and online publishing firm in Canada, specialized in providing services to direct selling firms. WDS Consultancy is a Supplier Member of the Canada DSA. It is the publisher of The World of Direct Selling, global industry’s leading weekly online publication since 2010. Hakki is an experienced professional with a strong background in direct sales. His work experiences in direct selling include Country and Regional Manager roles at various multinationals. You can contact Hakki here.

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HERBALIFE

Herbalife reported $1.5 billion sales for the third quarter. This was an increase of 22% compared to the third quarter of 2019 and represented the largest quarterly result in company history. Just as significant, year-over-year growth was recorded in company’s all geographic regions but one.

North America’s growth was 55%, EMEA’s 38%, Asia-Pacific’s 10%, South & Central America’s 8%, and finally China’s was 5%. Mexico was the only region that reported negative growth (-5%).

After the third quarter, Herbalife announced its fourth quarter 2020 and full year 2020 outlook based on current business trends: 10-20% sales growth for the fourth quarter and 12.2-14.7% growth for the whole year. This shows us Herbalife is targeting this year to be a $5+ billion company.

Herbalife’s CEO John Agwunobi commented, “During the third quarter, we achieved another worldwide sales record, with reported net sales exceeding $1.5 billion and growth of 22.3% compared to the prior year. Three of our six regions, North America, Asia-Pacific and EMEA, along with 24 countries set new quarterly net sales records. We have also seen growth in our sales force, which is now the largest it has ever been.”

Some of the impressive growth performances at country level in Q3 were:  Turkey 137%, U.S. 50%, and Spain 43%.

For more on Herbalife’s third quarter performance, please click here.

NATURA &CO

Natura group’s third quarter was a remarkable one for all of its businesses. Growth performances were as follows: Natura &Co Latam +30%, Avon International +23%, The Body Shop +52%, and Aesop +67%. Consequently, group consolidated revenue represented 32% increase from last year’s Q3.

As for as individual markets are concerned, management specifically mentioned outstanding performances of Natura brand in Argentina, Mexico and Chile. Brazil, Russia and Turkey were Avon’s more successful markets in the third quarter.

From The Body Shop perspective, company reported a significant shift to direct sales and e-commerce. The Body Shop’s direct sales business grew by 333%, and e-commerce by 103% in the last quarter. As opposed to these more-than-satisfactory results, the performance of The Body Shop’s retail business was noted as showing ”slower recovery”.

Roberto Marques, Executive Chairman and Group CEO said, “Enabled by continued digitalization, our brands delivered strong results in the third quarter, with significant growth in sales and margin improvement. In an environment that has remained challenging throughout the world as a result of the Covid-19 pandemic, we delivered superior results compared to the CFT market both globally and in Brazil. Our performance this quarter attests to the strength of our fundamentals, our unparalleled Direct-to-Consumer reach, and the resilience of our omnichannel, multi-brand model.”

For more on Natura &Co’s third quarter performance, please click here.

NU SKIN

Nu Skin CEO Ritch Wood’s comments after the third quarter were: “We generated revenue and earnings per share well above expectations. We drove revenue improvements in all but one reporting segment. We are outpacing our 2020 growth projections due to strong product demand and ongoing digital investments. We are also benefitting from the current environment where more individuals are working from home and shopping online. Currently, approximately 90% of Nu Skin revenue is coming from digital transactions.”

Nu Skin undoubtedly had a more than satisfactory quarter: 19% global sales growth with positive contributions from all its regions but China (-3%). Americas & Pacific grew by 81%, EMEA 72%, Southeast Asia 7%, Japan 6%, South Korea 5% and Hong Kong & Taiwan 4%. Management ties this high-growth in their Americas & Pacific region to the relaunch of the U.S. business. This relaunch project is branded as “Discover the Best U.S.””

With this Q3 performance, Nu Skin’s year-to-date revenue is almost the same as what it was in 2019. On top this, management announced its last quarter revenue expectation as $720 to $750 million. This will bring Nu Skin’s year-end revenue to $2.55 to $2.58 billion. This will be 6 to 7% yearly growth for the company.

For more on Nu Skin’s third quarter performance, please click here.

ORIFLAME

Oriflame’s third quarter sales was €281 million, down 3% from the third quarter of 2019 (€289 million). Company’s year-over-year revenue growth performance is -6%

“The challenges from Covid-19 and its impact on the people and economies around the globe continue, and we stay humble navigating our path forward with care. So far, the fourth quarter shows a low single digit growth in local currency. We believe that the strength of our business model, products, digital tools and foremost our people will continue to build a stronger Oriflame,” said CEO Magnus Brännström.

Latin America (-17%) and Asia (-16%) were the two regions responsible for Oriflame’s negative growth in Q3. Turkey & Africa reported 10% revenue growth, Europe 9%, and CIS 7%.

Just like Nu Skin, Oriflame also benefitted from digital initiatives. Company said 97% of its global orders were placed online. Mobile use in the third quarter was 83% of total users and 64% of total orders were placed using mobile devices.

Following the third quarter, Oriflame’s year-to-date total sales is about 94% of last year’s.

For more on Oriflame’s third quarter performance, please click here.

TUPPERWARE

Tupperware reported figures that all looked promising this time: Its sales was $477.2 million in the third quarter, up 14% from Q3 of last year, average active sales force was up 10% and sales per active was up 10%.

The company said these numbers reflected “strong engagement by the sales force utilizing digital tools and techniques to bring Tupperware’s reusable products to market during unprecedented times”.

After this positive quarterly revenue figure, Tupperware’s year-over-year nine-month sales comparison is better now (-9% vs. 20% after Q2).

Looking into the regional performances, North America came up with an impressive +42% and Europe with +23%. Sales in the United States and Canada had the highest level of growth the company had seen in over 20 years and the highest level of absolute sales in the fourth quarter of 2002, as management stated. South America reported 4% sales increase and Asia-Pacific was the only region that performed worse (-6%).

Miguel Fernandez, President and CEO was happy after these results saying they “reflect a rapid adoption of digital tools by our sales force to combat the social restrictions surrounding COVID-19, and the increased consumer demand for our innovative and environmentally friendly products, as more consumers cook at home and are concerned with food safety and storage.”

During the earnings call, Vice Chairman Rich Goudis showed where the company was headed at:  “We’re shipping from a push model to both consumer pull and sales force push. We will enter more product categories where the Tupperware brand is given permission by the consumer. We will create a good, better, best product and pricing strategy to reach and address the needs of all consumer socioeconomic levels.”

For more on Tupperware’s third quarter performance, please click here.

USANA

Third quarter net sales increased at USANA by 15% year-over-year to $299 million. Company tied this to “strong product demand and successful incentive programs”. First three quarters altogether, USANA’s sales is 4% above last year’s.

“This was an all-around very successful quarter for the company. During the quarter, our strategies led to strong global customer demand for our high-quality nutritional products. We also offered various incentives and promotions that were well received and contributed meaningfully to sales and customer growth for the quarter,”  said Kevin Guest, CEO and Chairman.

USANA’s third quarter sales in Southeast Asia Pacific was up 41%, North Asia up 24% and China up 4%. Americas & Europe region also reported 10% growth. China is USANA’s largest market with about 45% share.

For the whole of 2020, management has increased its sales expectations to $1.090 – $1.115 billion (from $1.050 – $1.100 billion). This, if achieved, will mean 2020 will be a year of growth as compared to 2019. Last year, USANA recorded 11% revenue decline.

On the much-emphasized launch of “Active Nutrition” line, management said the target was early next year. It is planned to be a market-specific launch but not all at once due to the different regulations in the markets. The target audience for this line would be  “female, ages 25 to 35”.

For more on USANA’s third quarter performance, please click here.

As we approach the year-end, we have started getting more and more positive news from the industry. We are all eager to see the annual results.

(*) Please click below links to read about how these companies did before:
First Quarter, 2020
Second Quarter, 2020

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Hakki Ozmorali is the Principal of WDS Consultancy, a management consulting and online publishing firm in Canada, specialized in providing services to direct selling firms. WDS Consultancy is a Supplier Member of the Canada DSA. It is the publisher of The World of Direct Selling, global industry’s leading weekly online publication since 2010. Hakki is an experienced professional with a strong background in direct sales. His work experiences in direct selling include Country and Regional Manager roles at various multinationals. You can contact Hakki here.

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Magnus Brännström has been serving as industry’s global federation WFDSA’s Chairman since 2017. Before this, he was the Seldia (The European Direct Selling Association) Chairman between 2012-2014.

Could you tell us about your education?

I have a degree in business and law from Uppsala University in Sweden. I have also studied languages: German, French and Russian at the university, and it helped me enormously in life and career. I also have gone through military training in the Swedish marines and I am an officer in the reserves.

What was your childhood dream?

To be a truck driver and to travel the world.

What were your past experiences before your current role at Oriflame?

I started my career as junior lawyer at the joint venture building Gland Hotel in St Petersburg, Russia. After that I became Export Manager for Spendrups beverages, based in Stockholm. In 1997 I joined Oriflame as Managing Director Russia and in 2005 I became the CEO of Oriflame.

What do you attribute your career success to most?

I could say, luck. But it probably would be a big exaggeration, though I do believe in luck that you build for yourself through hard work and taking right decisions in the right time. My big career success was possible due to many amazing people surrounding me and following me on this journey. I was always fortunate to have the best people on my team, and I guess it paid off.

What has been your most inspiring moment?

I have a lot of inspiring moments. But if I must choose, it will definitely be connected to my family. It is the moment when I met my wife Maria and understood that she is the one I want to spend my whole life with. It is the moment when each of out three kids were born. I also have a lot of Oriflame moments, connecting to meeting wonderful people who work hard, fulfill their dreams and show others that everything is possible.

Your hobbies?

I am super-fond of sports. We are a very sporty family. I prefer active free time. I run, swim, play hockey, play tennis. The latest hobby that I share with my wife and kids is paddle tennis. Amazing game. Every match is a success and you don’t have to be too skilled. It’s just simple and fun!

I also love animals. We have two dogs and a horse. I am not sure if you can call it hobby as they are part of our family. I do devote lots of my time to them – they give me energy.

How would you describe being a direct selling executive to an outsider?

It is special to work within direct selling or “social selling” as we call it nowadays. My job is both corporate, but it also has a big social component to it, as I am always among people. From different parts of the world. I follow numbers, KPIs and other business metrics. But I also follow amazing stories of people who are all so different but have one thing in common: Their drive! I keep being fascinated and inspired by them changing their lives, becoming entrepreneurs and building full-scale businesses.

What is your biggest achievement at Oriflame?

Despite very turbulent years and becoming a large company, we have been able to grow the business with a consistent focus on our culture of togetherness, spirit and passion, our employees and our brand partners, which made it possible for us to keep the spirit of a small entrepreneurial company. It is obviously not only my achievement – I share it with all my colleagues and leaders.

And your biggest challenge at a direct selling company executive role?

Time. It’s not enough and sometimes it feels it goes too slowly. This year our lives went upside down due to COVID. At the same time, there are some eye-opening experiences that we got, that opened many opportunities. Digitalization of our society and business fast forwarded with at least 10 years. We have so many ideas, so many initiatives. And if I could, I would implement them all at once. But of course, we need to be patient and we are taking it all step by step, constantly adjusting.

What would be your best advice to those who are thinking of joining a direct sales company at a corporate position?

Go for it! As you will make a difference to so many people that you don’t even know.

Click here to read the Q&A’s with other direct selling executives.

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Medifast for instance, reported 13% revenue growth in the first half of the year. Nature’s Sunshine’s figure was +0.6%. Mannatech’s sales on the other hand, declined by 5.6% in the first six months.

Shall we dive into some of the direct sellers’ reports more deeply? Let’s do it.

HERBALIFE

Following a very successful first quarter, Herbalife’s performance in the last three months was also in the positive direction: $1.346 billion sales with 9% global revenue growth. In fact, management announced the second quarter of 2020 was the largest quarter in Herbalife’s 40-year history in terms of “volume points”.

North America reported 39% quarterly sales increase, EMEA 14% and China 12%. On the other side, South & Central America region came up with 23%, Mexico with 21% and Asia-Pacific with 5% declines.

In the U.S., year-over-year volume points were at an all-time high and the monthly average number of unique customers increased year-over-year by more than 25% in the second quarter, the management reported. Additionally, some of European countries’ growth figures were very impressive: Spain 20%, Turkey 27%, France 55%, and the UK 90%. Herbalife distributors in Europe were able to adapt quickly to the new circumstances and transfer their businesses into a virtual environment, company said.

CEO John Agwunobi said, “As the numbers and facts demonstrates Herbalife Nutrition is performing at an exceptional level and we believe our distributors’ entrepreneurial spirit, combined with our quality line of nutrition products, will lead to continued growth. From a demand perspective, our business is backed by favorable consumer trends in an environment that has never been more responsive to what we bring to the table.”

For the remaining of 2020, the management announced that the extent and duration of business disruption and the impact from the pandemic could not be estimated so it would not provide a guidance.

For more on Herbalife’s Q2 performance, please click here.



NATURA &CO

Natura &Co’s first quarter revenue growth was 2%. This time it reported a significant decline: -13%.

Among the brands, Aesop recorded 35% growth in Q2 and The Body Shop increased its sales by 16%. However, the two of the larger brands posted negative growth figures: Natura &Co LATAM -17%, and Avon International -22%. Avon International also lost 36% of its active representatives in the seond quarter.

Natura &Co. LATAM composes of Latin American operations of the whole group, including Avon’s Latin American units. Within this, Natura was up 4.4% and Avon brand was down 35%.

Avon’s performances both in Latin America and in International units were tied to the impacts of lockdowns and the “cyber incident”. Management announced there were positive signs, though, in the third quarter.

Roberto Marques, Executive Chairman and CEO, commented, “Every brand and business in the group became truly omnichannel during the second quarter and given the circumstances, helped deliver a robust and competitive overall performance.”

For more on Natura &Co’s Q2 performance, please click here.

NU SKIN

Nu Skin reported $612 million sales in the second quarter. This is 2% less than its sales in Q2 of 2019 ($624 M). However, Nu Skin’s first quarter revenue was down 17%. So, this may indicate an improvement. Still, its global revenue growth as of mid-year is -9% compared to 2019.

Similar to the previous quarter, China contributed to this decline the most (-21%). China is Nu Skin’s biggest business unit. Its current share is 25% (down from 32% in mid-2019). Management was satisfied with China’s achievement in the second quarter saying it had performed close to where they had anticipated. At the beginning of the year, the anticipation was China to be down 20% to 25% and now Nu Skin expects it will be closer to 20%.

Hong Kong/Taiwan unit reported -15%, Southeast Asia -11%, and South Korea -9%. Positive performances were from Americas/Pacific (+38%), EMEA (+17%), and Japan (+5%). Management said growth in the last quarter was driven by the West, “where socially-enabled business is more broadly adopted”. Nu Skin had 51% customer growth in EMEA region led by the UK, Germany, Poland and South Africa. Company announced more than 85% of its global revenue was coming through digital transactions.

“Our business performed well above expectations in the second quarter of 2020 driven by our socially enabled business model, strategic investments in technology and manufacturing, and our balanced product portfolio,” commented Ritch Wood, CEO.

Nu Skin expects now to close this year with $2.37 to $2.45 billion revenue. Company’s guidance after the first quarter was $2.17 to $2.26 billion.

For more on Nu Skin’s Q2 performance, please click here.

ORIFLAME

Oriflame’s sales further declined in the last quarter (-12% compared to 2019) after the first quarter (-2%). Company’s total revenue is 7% less so far this year.

All regions of Oriflame reported declining sales in Q2: Latin America -34%, Asia -20%, Turkey & Africa -10%, CIS -2%, Europe -1%:

On the results, CEO Magnus Brännström said, “Despite a challenging start of the quarter, impacted by various lockdowns and difficulties to fulfil orders in several of our markets, we ended the quarter with local currency growth in June. The third quarter has started with around 10% local currency growth, implying that the reactivation initiatives taken during the spring have been effective and that our social selling platform is successful.” Oriflame reports that its supply was deeply impacted by the lockdowns in China, India and Italy.

In line with the general trend, company’s wellness product category was the best overall sales performer in the quarter, increasing its share to 18% from last year’s 13%.

As stated by the management, during the second quarter 97% of the Oriflame’s’ orders globally were placed online, of which 63% were from mobile devices. This is shown as a major factor behind reducing the negative impact on sales, when people stay at home due to the COVID-19.

For more on Oriflame’s Q2 performance, please click here.



TUPPERWARE

Tupperware has not seen a sales increase in a quarter compared with previous year since 2017. Company continued its downward trend in the second quarter of 2020.

Q2 sales was down 16% versus last year ($397 m vs. $475 m). South America contributed to this with -34%, Europe with -25%, Asia-Pacific with -14%, and finally, North America with -1%.  With this result, Tupperware’s mid-year revenue is 20% behind what it was in mid-2019.

Tupperware’s global active sales force also shrank in Q2 by 17%, declining to 467,000.

“In the second quarter we pivoted to a new way to lead the business, a new way to operate the company and embraced a new growth strategy. We are now increasing our efforts to contemporize Tupperware and become a global leader in sustainable consumer solutions while leveraging the consumer influence of our iconic brand,” commented Miguel Fernandez, CEO of Tupperware.

The management said Tupperware Board had approved a new growth strategy and they would share the full strategy later this year once they have “tangible accomplishments to point to”.

For more on Tupperware’s Q2 performance, please click here.

USANA

USANA reported $259 million in the second quarter. This represented 1% increase compared to previous year. Sales in Asia-Pacific region was up 2%, and in Americas-Europe Region it was down 2%. A large portion of USANA’s business is generated in Asia-Pacific. Markets in this region account for more than 80% of global sales. China alone produces about half of USANA’s revenue.

CEO Kevin Guest said, “We generated nearly 8% growth in active customers. We also continued to successfully execute a virtual sales and operating strategy to deliver our results. Finally, we offered several promotions and incentives during the quarter that benefited net sales and our overall results.”

As of mid-year, USANA’s revenue is flat versus 2019. After the second quarter, management increased its 2020 revenue outlook to $1.05 – $1.10 billion which if achieved, is in line with the sales in 2019.

For more on USANA’s Q2 performance, please click here.

There are reasons to be optimistic about the industry’s future. That’s for sure. We will see how the companies and the independent contractors will further adapt themselves to the changing conditions in the second half.

…..

Hakki Ozmorali is the Principal of WDS Consultancy, a management consulting and online publishing firm in Canada, specialized in providing services to direct selling firms. WDS Consultancy is a Supplier Member of the Canada DSA. It is the publisher of The World of Direct Selling, global industry’s leading weekly online publication since 2010. Hakki is an experienced professional with a strong background in direct sales. His work experiences in direct selling include Country and Regional Manager roles at various multinationals. You can contact Hakki here.

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HERBALIFE

Herbalife came up with a solid 8% revenue growth in the first quarter, increasing its quarterly sales to $1,262 billion. Maybe the most striking performance was from its China region that posted 26% growth. Sales in Asia-Pacific increased by 12%, in North America 8%, and in EMEA 3%.

In the U.S., the first quarter and the month of March were all-time record highs for Herbalife.

Management said it owed the postive results in China to the strategy change the company made in this market after last year’s “100-day review of the health products industry”. Then, Herbalife had decided to be less reliant on large in-person meetings. And therefore, it created a robust e-commerce platform and moved many of the sales meetings online. Eventually, “this has proven to be extremely helpful during the pandemic”, Herbalife stated.

Despite the positive results in the first quarter, management announced the pandemic’s impact on the results in the second quarter and also on full year 2020. So, “the company would periodically reassess its ability to provide guidance for full year 2020 as and when the impact of the pandemic could be reasonably estimated”. In fact, Herbalife’s global growth was in a decline last April by nearly 1%. While China and the U.S. were up 20% and 14%, India and Brazil were down 30% and 31%, respectively.

For more on Herbalife’s first quarter performance, please click here.



NATURA &CO

As we all know by now, Natura had added Avon to its portfolio last year and Avon was included in Natura’s consolidated figures for the first time in Q1 2020. With the addition of Avon, Natura &Co became the leading beauty company in Latin America, with 11.8% market share, as reported by the management

The group’s consolidated revenue in Q1 2020 was R$7,518 b (approx. US$1.3 billion). This was up 2% versus prior year. Within this, Natura &Co Latam recorded 2% growth. The Body Shop’s revenue increase was 3% and Aesop’s 27%. Avon International, once again, reported a sales decline: -2%.

Although too early, Natura management has so far been satisfied with Avon’s results.  “The rapid progress in integration” has led the company to raise its total synergy target to US$300 million to US$400 million over the next four years. This total synergy target has four pillars: Sourcing, manufacturing and distributon, administrative and revenue.

“Natura &Co Latam” unit brings 55% of the group’s global business, Avon Internatioal 28%, and The Body Shop 11%. Aesop, the unit that announced the highest percentage-wise growth, contributes 5%. As a side note, Avon’s Latin America business is included in “Natura &Co Latam”, together with The Body Shop’s and Aesop’s LATAM units.

Roberto Marques, Chairman and CEO, declared: “The first quarter of 2020 is the first to include Avon in our scope. We are very pleased by the rapid progress that has been made in integrating the company. This is more notable in that we have achieved this in the midst of the unprecedented global health crisis caused by the spread of the Covid-19 pandemic, which impacted our Q1 performance. In the face of the pandemic, the Group took quick action to adapt to this crisis, with three key priorities: Care for our people, care for our communities and care for our company.”

For more on Natura & Co’s first quarter performance, please click here.

NU SKIN

Nu Skin reported 17% revenue decrease in the first quarter versus last year’s same period ($518 m vs. $624 m). Company’s all business units contributed to this decline, China being on top of the list (-34%). Then came EMEA (-15%), and Americas/Pacific (-14%).

While the business in China was considerably down over previous year, management said it performed slightly better than they had anticipated. On the other hand, while South Korea performed mostly in line with the company expectations in Q1, the anticipation is that the effects of COVID-19 to be more impactful in the second quarter. South Korea represents about 15% of Nu Skin’s global revenue.

Commenting on the results CEO Ritch Wood said, “Our first quarter results demonstrated continued stability in the Nu Skin business with strong customer activity. More than 80 percent of our revenue comes through our digital properties which have been enhanced by our strategic investments in technology infrastructure and digital tools. Additionally, our manufacturing and supply chain investments have enabled us to effectively manage inventory and fulfill customer orders worldwide through very challenging circumstances.”

During the earnings call with the investors, the company also announced its plan to launch a new digital tool called “VERA”. This tool is to leverage artificial intelligence and machine learning to provide personalized product recommendations.

Nu Skin expects $520 to $550 million revenue in the second quarter. For the whole of 2020, the expectation is $2.17 to $2.26 billion. This is significantly lower than its 2019 sales (was $2.420 b).

For more on Nu Skin’s first quarter performance, please click here.

ORIFLAME

Oriflame reported 2% decline in its sales in the first quarter of 2020 as compared to last year (EUR 303 m vs. EUR 309 m).

The decrease in sales was mainly due to Asia and Europe offset by positive development in Latin America, Turkey & Africa and CIS. In fact, Asia (-13%), and Europe (-7%) were the two business units that came up with negative figures. Each of CIS (+11%), Latin America (+4%) and Asia & Africa (+4%) reported growth.

Oriflame’s independent consultants in the quarter remained almost stable at 2.8m (2.9m) on the field. Conpany’s unit sales decreased by 9% and the price/mix effect was positive 6%.

“During the quarter our ability to conduct physical meetings and conferences was affected and we also faced challenges in parts of the supply chain.Under these circumstances I am of course pleased that we today offer our Independent Beauty Consultants a modern way of social selling, with 96% of all orders being placed online. In addition, focusing on our strategic product categories has proven successful with wellness showing the largest sales increase in the quarter,” commented CEO Magnus Brannstrom. Wellness category deserved this special mention as its share showed a substantial increase last quarter: From 12% to 15%.

Besides 96% of the company’s global orders were online, during the first quarter mobile use was 79% (73%) of total sessions on Oriflame’s web sites and orders placed using mobile devices were 56% (47%). The total share of orders processed through the Oriflame app was 33%.

For more on Oriflame’s first quarter performance, please click here.

TUPPERWARE

Since 2013, Tupperware’ numbers have been in a downward trend. Looking back, this is quite a long time but until now, not much could have been changed. This eventually led to several changes at the top management which so far have not produced any substantial achievements. The most recent such appointment was Avon Italy General Manager Marco Brandolini’s to lead Tupperware EMEA.

At its peak, Tupperware’s annual sales was $2.672 B in 2013 and it came down to $1.798 B in 2019. In additon to this 30+% decline, management reported an additional sales decrease in the first quarter of 2020: -23% versus Q1 2019.

Tupperware shares were being traded at $67-68 at the end of 2013. This is now $2-3!

Obviously, the pandemic has only added to Tupperware’s existing problems. During the first quarter of 2020, the impact of COVID-19 on the company’s business was most pronounced in Europe and Asia Pacific, the management reported. Tupperware experienced partial or country-wide lockdowns in various markets in these regions, including China, France, Italy, and Philippines. That said, all regions contributed significantly to the sales decline as shown on the table to the right. Tupperware’s global active sales force was also down 15% in the first quarter.

Miguel Fernandez, President and CEO said, “Our top priorities are to protect the well-being of our employees and sales force, and to support our operations through the unprecedented challenges we face today.”

“Due to the material uncertainty of the duration and extent of the COVID-19 pandemic impact”, Tupperware management withdrew its full year 2020 outlook it had provided in February 2020.

For more on Tupperware’s first quarter performance, please click here.



USANA

As opposed to Tuppeware’s 23% revenue decline in Q1, USANA’s was more than acceptable, given the situation in the world: -2%.

The worst decrease was in China (-9%), Americas & Europe also reported a decline (-2%). Sales in North Asia grew by 23% and in Southeast Asia Pacific by 4%.

“Although COVID-19 in general, negatively impacted our business during the quarter, strong consumer demand for our high-quality, essential, health products and successful promotions helped us deliver operating results moderately ahead of our expectations. Importantly, our manufacturing facilities in the U.S. and China remain fully operational to date, and we have experienced no meaningful disruptions to our world-wide supply chain,” CEO Kevin Guest commented.

USANA had been in a very positive trend for several years until 2019 (it posted 11% revenue decline). Even with this, company’s 10-year compounded annual sales growth (CAGR) was 9%.

For 2020, USANA revised its revenue expectations to be between $1.00 – $1.08 billion (was $1.03 – $1.13 billion). This figure, if achieved, will be similar to company’s 2016 performance. As for the quarter we are in, management said the target was $250 million.

For more on USANA’s first quarter performance, please click here.

The general expectation is that things will be more difficult in the second quarter (and possibly, in the remaining of 2020). We will all see to what extent the industry will be able to adapt to the “new normal” and bounce back.

…..

Hakki Ozmorali is the Principal of WDS Consultancy, a management consulting and online publishing firm in Canada, specialized in providing services to direct selling firms. WDS Consultancy is a Supplier Member of the Canada DSA. It is the publisher of The World of Direct Selling, global industry’s leading weekly online publication since 2010. Hakki is an experienced professional with a strong background in direct sales. His work experiences in direct selling include Country and Regional Manager roles at various multinationals. You can contact Hakki here.

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The post Mixed Growth Performances in the First Quarter appeared first on The World of Direct Selling.

 HERBALIFE

“As I close out my tenure as Chairman and CEO and prepare to hand off both of these positions to John Agwunobi, I want to express my sincere gratitude to our distributors and employees who have worked so hard to advance our mission to change lives and communities around the world. It has been an honor to serve and see the growth of this great company over the last 17 years,“ commented Michael Johnson, following the Q4 results.

John Agwunobi, who as previously announced will become CEO effective March 30, 2020, will also assume the role of Chairman of the Board, effective upon his election to the Board.

Herbalife reported $1.2 billion sales in the last quarter. This represented 2.8% growth versus prior year same quarter. This was achieved despite a 15% sales decline in China. Asia-Pacific was impressively up 18% and North America up 9%. The growth in Asia-Pacific was led by India, Indonesia, Vietnam, Malaysia and South Korea, all of which grew by double-digits, management said.

With this quarter, Herbalife ended the year with a revenue figure ($4.877 b) very close to last year’s ($4.892 b).

At this time, management refrained from giving any guidance for 2020, mentioning the difficulties in estimating the extent of impact from the Coronavirus. They said they would update its guidance for full year 2020 when they could reasonably estimate this impact.

For more on Herbalife’s fourth quarter performance, please click here.

NATURA

Natura had been on the headlines almost continuously throughout 2019 due to its Avon acquisition, a major transaction from many aspects. This operation was finalized early this year and the new entity (i.e. “Natura & Co”) started trading on the New York Stock Exchange on January 6.

Revenue-wise, last year was certainly a success for Natura. The consolidated net sales increased to 14,447 b. Brazilian Real (approx. US$ 3 b). That was 8% growth from previous year.

Natura’s consolidated sales included its direct selling arm Natura, The Body Shop and Aesop, all of which reported positive sales increases in 2019. Natura’s growth was 7%, The Body Shop’s 6%, and Aesop’s 23%. Natura is the largest unit of the three, generating more than 60% of the group sales.

These businesses reported strong results in the last quarter, too: Natura grew by 5% as compared to Q4 2018, The Body Shop by 7%, and Aesop by 26%.

Roberto Marques, Group CEO and Chairman of Natura &Co said, “2019 was another year of profitable growth and transformation for Natura & Co, as we continued to make significant progress in building a multi-brand, multi-channel, purpose-driven group that has now become the -largest pure play beauty company.”

For more on Natura’s fourth quarter performance, please click here.

NU SKIN

“In the fourth quarter our business performed in line with expectations,” said Ritch Wood, chief executive officer of Nu Skin. “Our customer base remained relatively strong however, our sales leader count was down in the quarter, primarily driven by a decline in Mainland China.”

Nu Skin’s last quarter global sales was $583 million, down 15% from prior year same quarter. Together with this, company closed the year with $2.420 b sales. This again, meant a 10% annual revenue decline.

Like Ritch Wood said, Nu Skin owed much of its revenue decline to its China market. Sales in China dropped by 29% or by $63 million (2/3 of Nu Skin’s overall sales decline) on a quarterly basis. That said, none of Nu Skin’s other units posted growth in Q4 (Japan did marginally).

For 2020, management announced their outlook as $2.17 billion to $2.30 billion revenue (or, 5 to 10% negative growth). They anticipate the overall business will return to growth in the fourth quarter of 2020, driven by the launch of a new beauty device. Their projected sales decline in Mainland China for the year is 20 to 25%.

For more on Nu Skin’s fourth quarter performance, please click here.

ORIFLAME

Oriflame, once again in its history, was delisted from the stock exchange and has been a private company since mid-2019. As it continues reporting its figures and as it is a major force in the European direct selling industry, I have included it in this review.

Company reported EUR357 million sales in the last quarter. This meant 1% decline. Company’s annual growth in 2019 was also down 2%.

Oriflame complained in its report about the challenges in some of its main markets primarily in Asia & Turkey. The situation in Asia & Turkey, the management said was mainly as a result of a decrease in the number of registered actives. Latin America continued to deliver positive performance driven by Peru and followed by Mexico and Ecuador. Positive sales development was seen in Africa primarily driven by Nigeria while Europe declined due to sales force and activity reduction. CIS delivered an increase in local currency sales supported by a solid growth in productivity an increase in registered actives. The new market Uzbekistan successfully commenced sales operations.

Management stressed their focus on “online” in their year-end report. During the fourth quarter, 76% of the sessions on their website came from mobile devices and 96% of the company’s global orders were placed online, of which more than 55% came from mobile devices.

For more on Oriflame’s fourth quarter performance, please click here.

USANA

USANA reported $271 million in the last quarter and this was 9% less than Q4 of 2018. With this, company closed the year with $1.061 billion sales, a decrease of 11%. Company’s total number of active customers at the end of the fourth quarter was 586,000, compared to 616,000 in the prior-year period

CEO Kevin Guest was not dissatisfied, though, saying, “Our fourth quarter results were stronger than expected and allowed us to finish the year strong. Our performance was driven by a better-than-expected response to promotions we offered during the quarter, as well as improved general momentum in many of our markets around the world, including China. As we begin 2020, we acknowledge the evolving situation in China, where our customers, employees, and China’s health officials are responding to the spread of the coronavirus.”

China is a very important market for USANA, generating about half of company’s global revenue. In fact, USANA basically does not have strong presence in markets out of Asia. Total sales in Americas and Europe make up 20% of USANA’s total.

During the investors’ call, management made an early announcement and said they were planning to roll out a whole new product category in early 2021. This new product line is expected to offer customers a more holistic approach to their health and wellbeing.

USANA expects net sales between $1.03 billion and $1.13 billion in 2020.

For more on USANA’s fourth quarter performance, please click here.

We will have to wait now to see what this year will look like for the direct sales industry. Given the current situation we all have been in, most probably things will not be as good.

…..

Hakki Ozmorali is the Principal of WDS Consultancy, a management consulting and online publishing firm in Canada, specialized in providing services to direct selling firms. WDS Consultancy is a Supplier Member of the Canada DSA. It is the publisher of The World of Direct Selling, global industry’s leading weekly online publication since 2010. Hakki is an experienced professional with a strong background in direct sales. His work experiences in direct selling include Country and Regional Manager roles at various multinationals. You can contact Hakki here.

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The post 2019 in a Few Major Companies’ Figures appeared first on The World of Direct Selling.

This week’s featured article is a brief compilation of industry news of significance from 2019. As you scroll down, I am sure you will agree with me that it was most certainly another exciting year for the industry with all the positives and the negatives.

I have also included articles from The World of Direct Selling that attracted much interest last year.

> Herbalife CEO Richard Goudis Resigns Over Comments He Made Before Taking the Job
> New Avon Names Laurie Ann Goldman CEO
> Stella & Dot to Exit European Market
> China Launches Campaign to Regulate Health Product Market
> Nerium Gets New Name
> Jeunesse Posts Record Year with $1.46B in Annual Sales
> Mary Kay Celebrates 50 Years of an American Icon – the Mary Kay Pink Cadillac
> LuLaRoe Founders Accused of Hiding Millions to Avoid Creditors

Most-Read Article in January on The World of Direct Selling:
What Direct Sellers Can Learn from the Corporate Training Industry (Vince Han)

> Amway Reports Sales of $8.8 Billion USD in 2018
> USANA Posts Another Sales Increase as China’s Direct Selling Clampdown Looms
> Avon Sees Revenues Decrease in Q4, Full Year 2018
> Herbalife Neared $5 billion Mark in 2018; Waits for Other Shoe to Drop in Goudis/China Probe
> Medifast Announces 87% Revenue Increase in Q4 and 66% for the Full Year
> Nu Skin Expands to Peru
> Skin Care Billionaires Rodan and Fields Return to the Teen Acne Market

Most-Read Article in February on The World of Direct Selling:
The 7 Giants’ 2018 Growth Review (Hakki Ozmorali)

> Fact or Fiction? Let’s Set the Record Straight – US DSA President
> Brazil’s Natura and Avon Confirm Deal Talks
> Nature’s Sunshine Reports $365 Million Sales for 2018, Up 7%
> Tupperware Parties: Suburban Women’s Plastic Path to Empowerment
> Two Mary Kay Executives Make Black Enterprise’s 2019 Most Powerful Women List
> Why Direct Sales Appeals to So Many Moms

Most-Read Article in March on The World of Direct Selling:
Common Pitfalls that Prevent Profitability in Direct Selling Start Ups (Dan Murphy)

> DSN Announces the 2019 Global 100
> Young Living Celebrates 25 Years of Global Growth
> Amway Disrupts Its Own Beauty Business, Launching 50 New Mobile Apps
> More Than 100 LuLaRoe Sellers Have Filed for Bankruptcy
> How Blake Mallen Capitalized on the Gig Economy Before It Was a Thing
> Brazilian Cosmetics Giant in ‘Advanced Talks’ with Avon
> Mary Kay Recognized by Forbes as One of America’s Best Midsize Employers 2019

Most-Read Article in April on The World of Direct Selling:
Marketing’s New Role to Keep A Direct Selling Company Relevant (Jonas Hedberg)

> Oriflame’s Co-Founder Jonas af Jochnick Has Suddenly Passed Away
> Nu Skin Named the World’s #1 At-Home Beauty Device System Brand by Euromonitor
> Tupperware Names CEO Tricia Stitzel Chairman of the Board
> AdvoCare Business Changing
> Founding Family Offers to Buy Out Oriflame
> It’s Official: Natura Buys Avon

Most-Read Article in May on The World of Direct Selling:
AdvoCare Abandons MLM: Uncertainty Returns to Direct Selling (Jeff Babener)

> WFDSA Announces Record-setting 2018 Direct Selling Business Results
> LG to Acquire New Avon North America
> US DSA Announces 2019 Awards Winners and Highest Performing Companies
> Natura’s Avon Acquisition Creates the First Latin American Beauty Powerhouse
> Retail Was Never in Our Plan and It Won’t Happen in Future Also: Frederic Widell, Oriflame VP
> Kirsten Dunst Is Making a Show About a Cult-Like MLM Company
> Amway, the Family Business that Became Global (Google-Translated Text)

Most-Read Article in June on The World of Direct Selling:
2019: The Year Direct Selling As We Know It Changed Forever (Brett Duncan)

> Happi Magazine Announces Top 50 Household and Personal Products Companies
> Canada DSA’s Recipients of the 2019 DSA Awards
> Amway Sues Sellers for Trademark Infringement, Faulty Product Distribution
> As India Hicks Closes Her Luxury Label, Is This the End of Tupperware-Party Shopping?
> USANA: China’s 100-Day Crackdown Has Damaged Consumer Confidence; Sales Drop by 15%
> Mary Kay Champions Business Excellence, Ethics and Social Responsibility, Reaps Rewards in Europe
> Nature’s Sunshine Announces New Global Leadership Structure and Appointments
> Pampered Chef Succeeds in Trademark Infringement Battle

Most-Read Article in July on The World of Direct Selling:
Five Ways the Direct Selling Industry Can Achieve Sustained Growth (Ben Gamse)

> New Amway CEO Shares Digital Vision
> doTERRA CIO Todd Thompson: Social Selling Is Taking off
> Executive Changes at Scentsy
> LG Closes $125M Acquisition of New Avon
> Coty and Younique to Part and Focus on the Development of Their Respective Strengths
> US Direct Selling Association CBD Memo: Ingestible CBD-Infused Products Violate DSA Code of Ethics
> “Tupperware-Style” Retail Makes a Comeback with 27% Growth in UK

Most-Read Article in August on The World of Direct Selling:
Why Are They Leaving Our Company? (Hakki Ozmorali)

> DSA Canada Responds to Globe & Mail Article
> Natura Lands in Asia and Starts Operations in Malaysia
> Tracy Britt Cool to Leave Pampered Chef to Start New Venture
> Rodan + Fields to Launch in Japan
> WorldVentures Expands to Brazil
> Nature’s Sunshine Announces Entry into CBD Market
> MONAT Expands into Europe with Its Launch in Ireland and Poland
> Amazon Challenges Amway, Modicare and Oriflame Ruling in Supreme Court

Most-Read Article in September on The World of Direct Selling:
Natura and Avon: Will This Acquisition Work for Both Sides? (Hakki Ozmorali)

> AdvoCare Will Pay $150 Million To Settle FTC Charges
> FTC v. AdvoCare: Enforcement Action Demonstrates Importance of Compliance Programs
> Uber Is Launching a New App That Matches Freelance Workers with Businesses
> Herbalife Announces CEO Succession Plan
> How Mary Kay China Is Trying to Stay Relevant with Younger Beauty consumers
> Beautycounter Appoints COO and CCO
> Origami Owl CEO Chrissy Weems Explores the Roots of a Successful Business
> USANA Announces Appointment Promotion of Walter Noot to Chief Operating Officer
> Oriflame to Focus on Wellness, Position as Healthy Lifestyle Brand: CEO Magnus Brannstrom

Most-Read Article in October on The World of Direct Selling:
FTC vs. AdvoCare: A Teachable Moment for Direct Selling (Jeff Babener)

> Neora Files Suit Challenging FTC’s Attempt to Change Direct Selling Laws
> Herbalife, Younique, LuLaRoe And Other MLMs Suddenly Under Fire
> LuLaRoe: From Startup to Over $1 Billion in Less Than 4 Years. Lessons and Growing Pains
> Tupperware Appoints Chris O’Leary Interim CEO
> U.S. Charges Two Former Herbalife Executives in China over Bribery Scheme
> UK DSA Announces 2019 Star Award Winners
> Jeunesse Enters Global Essential Oils Market

Most-Read Article in November on The World of Direct Selling:
AdvoCare, Neora, an Ever More Aggressive FTC! What Now? (Alan Luce)

> Kyani Founders Identified as Victims in Plane Crash
> Former New Avon CEO: Company Reneged on $1M Severance
> USANA Announces Retirement of Founder and Chairman, Myron W. Wentz
> Why Market America Is a Legitimate and Thriving Business
> US DSA  2019 Sales and Marketing Conference Reveals New Data on Direct Selling and Independent Work
> The 10 Beauty Brands That Defined the 2010s

Most-Read Article in December on The World of Direct Selling:
5 Keys to Communications Confidence in 2020 (Crayton Webb)

…..

Hakki Ozmorali is the Principal of WDS Consultancy, a management consulting firm in Canada specialized in providing services to direct selling firms. WDS Consultancy is a Supplier Member of the Canada DSA. It is also the publisher of The World of Direct Selling, global industry’s leading weekly online publication since 2010. Hakki is an experienced professional with a strong background in direct sales. His work experiences in direct selling include Country and Regional Manager roles at various multinationals. You can contact Hakki here.

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The post A Year in Review: 2019 in the News appeared first on The World of Direct Selling.

AVON

Avon’s global sales in the first quarter was $1.187 million, 15% less than its figure in the same period of 2018.

Its EMEA region came with 19% and South Latin America with 17% quarterly decline in revenue. Sales in North Latin America was down 1% and the only positive figure was from Asia Pacific which grew by 3%. At the markets level, Russia’s quarterly sales was -31% and Argentina’s was -27% as the two worst-performers.

Avon’s active representatives in the first quarter was down 9%, too.

Commenting on the first quarter results, CEO Jan Zijderveld was optimistic: “Although total revenue is down, we see improvements in many areas, especially the better underlying trends in Brazil and continuing good performance in Mexico; however, we did deteriorate in Russia.”

Last month, Avon signed an agreement with LG Household & Health Care to sell its remaining 19.9% ownership in New Avon (i.e. Avon North America). Avon had previously sold its majority shares in Avon North America to Cerberus.

Furthermore, we know there is a strong interest from Brazil’s Natura to acquire Avon globally.

For more on Avon’s first quarter performance, please click here and here.



HERBALIFE

Herbalife’s quarterly sales of $1.2 billion included growth in four out of its six regions and was approximately flat compared to first quarter 2018. Excluding China, sales increase was 6% compared to the first quarter of last year. In China, sales decrease was 29%. Herbalife’s other poor performing region was South & Central America (-21%).

Re-appointed CEO Michael Johnson said, “We delivered net sales growth in four of our six regions, which included year-over-year growth in seven of our top 10 countries. Our geographic diversity is an asset that helps us deliver these results, and geographic diversity is uncommon in the nutrition and direct selling industries.”

The Chinese government had announced a 100-day review of Herbalife’s health products that had an impact on its business, the management said. Without the impact from China, Herbalife announced it would not have taken down its yearly guidance for the full year.

Herbalife’s sales growth expectation for the second quarter is between -3.5% and +2.5%.For the full year, it is between -1% and +5%.

For more on Herbalife’s first quarter performance, please click here and here.

NATURA

Natura reported R$ 2.915 billion in the first quarter of 2019. This represents more than 8% growth over last year’s Q1. Natura is the sixth largest direct seller in the world as of 2018 sale.

Among the Natura group, Aesop brand’s sales increased by 34%, The Body Shop by 10%, and the flagship company Natura’s net revenue grew by  5%.

Roberto Marques, Executive Chairman said: “Natura & Co. of posted another solid set of consolidated results in the first quarter of 2019, confirming the continuing momentum of the multi-brand, multichannel, purpose-driven beauty group we have constituted. All three of our brands and businesses posted sales growth in Brazilian Real in spite of challenging market conditions in some key markets, notably Brazil.”

For more on Natura’s first quarter performance, please click here.

NU SKIN

The first quarter sales of US$629 million meant 1% growth for Nu Skin (vs. US$616 million).

China was the main driver with 6% sales increase. China was followed by Southeast Asia as the only other region that posted growth (2%). Nu Skin’s all other five regions reported decreasing revenue.

“We remain confident in our growth prospects in 2019 as we focus on the continued execution of our growth strategy. We will drive increased productivity by investing in technologies to better support our sales leaders, expanding our global beauty device systems with product introductions and line extensions, and optimizing our Velocity sales compensation program,” said CEO Ritch Wood.

Nu Skin’s announced its 2019 annual revenue guidance as $2.76 to $2.81 billion. For the second quarter, projected revenue is $660 to $680 million.

For more on Nu Skin’s first quarter performance, please click here and here.

ORIFLAME

Oriflame closed the first quarter with 7% decrease in its global sales (EUR 309 m vs EUR 331 m).

CEO Magnus Brannstrom said, “While we are encouraged by the positive development in Latin America, Africa, Europe and most of the CIS markets, we continued to see a sales decline in Asia & Turkey impacted by challenging market conditions as well as governmental and legislative initiatives in China and Vietnam.”

Oriflame’s worst performance came from its Asia &Turkey region where sales dropped by 17% versus last year’s Q1. CIS was down also 4%, but Europe & Africa (+2%) and Latin America (+10%) came with better results. The situation in the Asia & Turkey region can be alarming for the company as these markets account for more than 1/3 of Oriflame’s total volume. Active representatives in this region decreased 20%, too.

For more on Oriflame’s first quarter performance, please click here.



TUPPERWARE

Within this group of seven, Tupperware reported the second worst sales growth performance after Avon. Tupperware’s US$487 million quarterly revenue was 10% lower than previous year same period’s.

All regions contributed to this global result with their negative growths: South America -20%, North America -11%, Asia-Pacific -9%, and Europe -4%.

CEO Tricia Stitzel commented, “We are beginning to implement the detailed project plans for transformation initiatives that we announced in January aimed at enabling sales growth and providing some future direct annualized cost savings. In the near term, we are pleased to see sequential improvement in sales as we continue to stabilize the business during this transformation period. We are also making good progress on our access and engagement strategies through studio expansion and digital deployment.”

Management announced company’s annual revenue is expected to decrease by 3-5% in 2019 as compared to 2018.

For more on Tupperware’s first quarter performance, please click here and here.

USANA

USANA, too, reported negative growth in the first quarter: -6.5%

“Three factors unfavorably affected our sales results for the first quarter of 2019,” said CEO Kevin Guest. “First, our 2019 operating plan contained very little promotional activity during the first quarter… This had a more significant impact on our global momentum than we anticipated… Second, the Chinese government’s 100-day review of the health product and direct selling industries that occurred during the quarter was accompanied by unexpected, persistent, negative media coverage about these industries in China… Finally, the unfavorable impact of a stronger U.S. dollar on net sales was also significant.”

In fact, first quarter sales in China was down 8.7%. This market accounts for more than half of USANA’s global revenue.

Company’s global sales in 2019 is expected by the management to be between $1.21 billion and $1.26 billion, representing growth between 1.7% and 5.9%.

For more on USANA’s first quarter performance, please click here and here

We will have to wait now to see what the rest of the year will look like for these companies.

…..

Hakki Ozmorali is the Principal of WDS Consultancy, a management consulting firm in Canada specialized in providing services to direct selling firms. WDS Consultancy is a proud Supplier Member of the Canada DSA. It is also the publisher of The World of Direct Selling, global industry’s leading weekly online publication since 2010. Hakki is an experienced professional with a strong background in direct sales. His work experiences in direct selling include Country and Regional Manager roles at various multinationals. You can contact Hakki here.

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The post 2019 First Quarter in Giants’ Numbers appeared first on The World of Direct Selling.

The review focuses on the largest seven publicly-owned direct sellers: Avon, Herbalife, Natura, Nu Skin, Oriflame, Tupperware and USANA.

AVON

Avon’s total revenue in the last quarter of 2018 was $1.402 billion, representing a 11% decrease from 2017 last quarter ($1.569 billion). Annual result was down 3% from 2017, adding another year of negative growth to Avon’s history. None of Avon’s regions was able to report sales increase in the last quarter.The worst result was from South Latin America with 15% quarterly sales decrease.

Active representatives also declined 6% in Q4, with decreases in South Latin America, Europe, Middle East & Africa, and Asia Pacific.

In 2018, 69% of Avon’s sales was generated by its beauty line, 14% by fashion products and 11% by its “home” category.

CEO Jan Zijderveld said, “As I wrap up my first year at Avon, we have a clear strategy to Open Up Avon and are taking the necessary steps to return this company to growth. We understand that the foundation of our success lies in the training and retention of our Representatives. Empowering women to build successful businesses and generate relevant earnings in countries around the world will, in turn, enable us to grow. This is a large task that involves the efforts of every employee and Representative.”

In late January this year, Avon announced 10% reduction in its global workforce, 15% in inventory reduction and 25% decrease in Stock Keeping Units (SKUs).

For more on Avon’s Q4 2018 results, please click here and here.



HERBALIFE

Herbalife ended last year $100 million short of being a $5B-company. Herbalife’s 2018 revenue of $4.892 billion meant 10% growth versus 2017.

Final quarter performance was $1.187 billion sales, up 8.5% from Q4  of 2017. Highest growth was achieved in Asia-Pacific (+22%). North America region reported 11.7%, China 11.1%, Mexico 6.0%, and EMEA 5.7% growth. The smallest region in size, South & Central America reported decreased sales (-18.5%). Management said year-over-year increases were achieved in 8 of company’s top 10 markets. Herbalife’s regional sales figure for the full year of 2018 are shown on the right:

“In 2018, we continued to show the strength of our business in providing premier nutrition products to distributors and consumers around the world. We achieved double digit net sales growth and record volume points, enhancing our value for shareholders,” said Michael O. Johnson, Chairman and CEO of Herbalife.

In early January this year, Herbalife’s CEO Rich Goudis had abruptly resigned with immediate effect, resulting in previous CEO Michael O. Johnson taking over.

Company announced its sales growth target for 2019 as “between 4% to 8%”.

For more on Herbalife’s Q4 2018 results, please click here and here.

NATURA

Brazil’s cosmetics giant reported 16% revenue increase in Q4. Natura’s 2018 full year sales growth was 36% over previous year. Without the positive base effect of The Body Shop’s acquisition in 2017, the annual growth was still a remarkable 13.5%, reaching Brazilian Real 13,397 billion (approx. USD 3.6 billion).

Management announced Q4 2018 was the strongest quarter in Natura’s history.

Natura group’s consolidated business consists of three divisions: Natura, The Body Shop and Aesop. Natura division reported 10% growth in 2018, The Body Shop 18% (with base-effect adjustment), and Aesop 51%.

Currently, Natura division accounts for 63% of the group’s consolidated global sales. 29% is generated by The Body Shop, and 8% by Aesop.

For more on Natura’s Q4 2018 results, please click here.

NU SKIN

With the 3% revenue increase in the fourth quarter, Nu Skin ended the year with 18% sales growth as compared to 2017 ($2.679 b vs. $2.279 b).

The highest quarterly growth came from South Asia (+9%). That was followed by EMEA (+6%), and Hong Kong/Taiwan (+2%). Nu Skin’s largest region Mainland China’s sales decreased by 2%. China alone accounts for about 1/3 of company’s global sales.

“We grew our revenue 18% percent for the year, with growth coming from virtually all of our segments. We were also encouraged that our customer acquisition strategy resulted in 16% growth in our customer base,” said Ritch Wood, CEO of Nu Skin.

For 2019, Nu Skin announces it expects $2.76 billion to $2.82 billion annual sales, that is 3 to 5% growth.

For more on Nu Skin’s Q4 2018 results, please click here and here.



ORIFLAME

Oriflame’s sales in the last quarter of 2018 was €370.3m, down 3% from previous year. Company’s full year sales growth performance for the whole year was also -3%. Its field force on the hand, increased by 1% in 2018, thanks mostly to the performances in CIS  (+12%) and Latin America (+9%).

In Q4, revenue in Europe & Africa grew by 7%, Latin America by 5%, decreased in CIS region by 2%. The worst quarterly performance came from Oriflame’s Asia & Turkey region: -13%. Asia & Turkey is company’s largest region with its close to 40% share.

Oriflame’s revenue generating product categories’ shares in total revenue are as below. Wellness products’ performance was remarkable in 2018 (increased to 13% from 11%):

CEO Magnus Brannstrom said on the results, “2018 has been a year of mixed performance for Oriflame. While the slower development in Asia & Turkey during the fourth quarter was disappointing, the improved sales momentum in most other regions demonstrates the strength of our balanced geographical footprint.“

For more on Oriflame’s Q4 2018 results, please click here.

TUPPERWARE

Tupperware’s fourth quarter growth was quite a disappointment for its investors: $506 million in revenue which was down 14% from same period of 2017. With this last quarter performance, Tupperware closed the year with 8% less sales versus 2017 ($2.070 billion vs $2.256 billion)

All regions made a contribution to Tupperware’s disappointing fourth quarter performance: South America (-22%), Asia-Pacific (-16%), Europe (-12%), and North America (-7%).

Tricia Stitzel, President and CEO of Tupperware, commented, “Our sales and segment profit results in the fourth quarter were not what we expected, leading to our desire to accelerate the business transformation to capitalize on our Global Growth Strategy. We continue to operate with a sense of urgency and remain confident that, over time, our initiatives will ensure our major units deliver consistent sales and profit growth and create enhanced value for our shareholders.”

Management declares its “strategic road map” includes five components as the table to the right shows. Yet Tupperware management is not too optimistic for this year as it announced it had targeted an additional revenue decline of 2 to 4% in 2019.

For more on Tupperware’s Q4 2018 results, please click here and here.

USANA

USANA came up with impressive sales growth both in the fourth quarter and in 2018 as a whole: Fourth quarter revenue was $299 million (an increase of 9.5% year-over-year), and 2018 full year revenue was $1.189 billion (an increase of 14% from 2017). USANA has been generating over $1 billion annually for the last three years now. 2018 also marked the 16th consecutive year that the company has delivered record sales.

In the last quarter of 2018, USANA generated 81% of its sales from Asia-Pacific region. Americas and Europe accounted for the rest (19%). China is USANA’s largest market with its 56% share in revenue.

“USANA finished the year with another quarter of solid results, bolstered by our annual China National Sales Meeting in Macau and a few targeted product promotions in select markets,” said Kevin Guest, Chief Executive Officer.

For 2019, USANA expects net sales between $1.25 billion and $1.30 billion, representing a growth of between 5.1% and 9.3%.

For more on USANA’s Q4 2018 results, please click here and here.

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Hakki Ozmorali is the Principal of WDS Consultancy, a management consulting firm in Canada specialized in providing services to direct selling firms. WDS Consultancy is a proud Supplier Member of the Canada DSA. It is also the publisher of The World of Direct Selling, global industry’s leading weekly online publication since 2010. Hakki is an experienced professional with a strong background in direct sales. His work experiences in direct selling include Country and Regional Manager roles at various multinationals. You can contact Hakki here.

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The post The 7 Giants’ 2018 Growth Review appeared first on The World of Direct Selling.

Company’s name originated from a royal banner of medieval France that was opened only on the battlefield. The original word is “Oriflamme” and means “golden flame”. The first company logo is shown on the right.

The business did grow in time, expanding into some of the Western European countries. Oriflame even went public on the London Stock Exchange. However, until late 1980s, Oriflame registers no major international success.



As the 1980s were ending, the brothers Jonas and Robert af Jochnick saw a huge opportunity in the democratization of the Eastern Bloc in Europe: Poorly served markets, coupled with a large number of talented and well-educated masses who would be willing to seek entrepreneurial opportunities that had not existed before.

Thus, Oriflame establishes a “daughter company” by the name of Oriflame Eastern Europe S.A. (or short, ORESA) based in Brussels. The older brother Jonas af Jochnick leads this operation as a very different entity from the parent company in many ways. The whole strategy was based on a very aggressive international expansion. The aim was to open as many ex-Eastern Bloc countries as possible and establish solid presences there before the major competitors do, especially Avon and Amway. To do this, it had to be practical in many aspects and also to be aggressive on the field. Amway’s compensation plan served both purposes and it was implemented almost unchanged in this operation.

Between 1990 and 1996, many new markets were opened through ORESA, like the Czech Republic, Poland, Hungary, Russia, Latvia, Ukraine, Slovakia, Bulgaria, Lithuania, and Romania. With the momentum gained, Turkey, Greece and India were opened, too.

This major shift in its strategy brought a huge success to Oriflame. So, in 1999 Industry Kapital (now called, IK Investment Partners), a leading European private equity company bought 45% of Oriflame’s shares, delisting the company from the London Stock Exchange.

In line with the initial plans, company shares were re-listed on the Stockholm Stock Exchange in March 2004. With this, Industri Kapital was realizing its investment in Oriflame through a SEK11.3 billion (approx. US$ 1.5 billion) initial public offering (IPO). The offering was reported to be more than ten times over subscribed and had provided Industri Kapital with a six times multiple on its original investment. Industri Kapital then, continued selling its shares on the stock exchange and exited fully by selling its remaining 4.5% stake in August 2006.

Having celebrated its 50^th anniversary in 2017, Oriflame is one of today’s major international direct selling companies. It operates in 60 markets all over the world, has six production facilities in four countries, employs over 6,000 people and has a yearly revenue of €1.4 billion (2017). With this revenue, Oriflame is the second largest European direct seller after Vorwerk.



If this idea of expanding into Eastern Europe at an unprecedented pace had not been implemented, could Oriflame be as successful today? Having been a part of Oriflame’s management team at the time, I can confidently answer this: “Hardly!”

More Pages in the History of Direct Sales:
FTC vs Amway (1975-1979)
The Death of Mark Hughes

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Hakki Ozmorali is the Principal of WDS Consultancy, a management consulting firm in Canada specialized in providing services to direct selling firms. WDS Consultancy is a proud Supplier Member of the Canada DSA. It is also the publisher of The World of Direct Selling, global industry’s leading weekly online publication since 2010. Hakki is an experienced professional with a strong background in direct sales. His work experiences in direct selling include Country and Regional Manager roles at various multinationals. You can contact Hakki here.

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The post A Page in the History of Direct Sales: Opening Up the Gates of Eastern Europe appeared first on The World of Direct Selling.

This analysis will focus on the public direct selling companies, Avon, Herbalife, Natura, Nu Skin, Oriflame, Tupperware and USANA, in alphabetical order.

AVON

After the third quarter, Avon’s CEO Jan Zijderveld gave an opening speech at the investors call and said that six weeks ago he had described Avon as the “patient on the operating table”. Avon has been presented by its management as being in similar situations over and over again… for seven years now.

Avon reported $1.4 billion revenue in the third quarter, almost the same as last year same quarter. However, excluding the Brazil IPI tax release in this quarter, Avon’s total revenue decreased 11% to $1.3 billion. South Latin America reported 9% sales growth, sales in Asia-Pacific was up +2%, North Latin America reported unchanged sales, and sales in EMEA was down 8%.

Management said Brazil’s performance had continued to negatively impact company’s  overall results. The sales decline, it was said, represented more than 80% of the overall revenue decline from all segments.

Avon’s active representatives declined 5% with decreases in all its regions and its ending representatives were -6%, again, with decreases in all regions.

During the investors call, CEO Zijderveld responded to a question and told about their strategy: “Internally we’re shifting really a lot of focus to productivity of our representatives and increasing her earnings. And in the end, that is all about rep retention. So, we’ve a pretty good recruitment machine, but what we really need to add to it is a retention machine, and the core of the retention is really about earnings, and earnings is really driven by training, and it’s as simple as that.”

Avon’s beauty product sales dropped by 16%, “color” recording the highest decline (-21%. Its fashion and home line declined by 8%, too.

For more on Avon’s Q3 results, please click here and here.

Herbalife increased its quarterly sales by 15% compared to last year third quarter ($1.243 b vs. $1.085 b). The highest growth came from its China region that grew by 27%. North America (+20%), Asia-Pacific (+19%), EMEA (+10%) and Mexico (+6%) were the other regions that contributed to growth. South & Central America, the smallest of Herbalife’s all regions, was the only region that came up with decreased sales (-10%). After these results, Herbalife’s revenue in the first three quarters is 11% above the same period of 2017.

Herbalife CEO Rich Goudis said, “This quarter was our largest third quarter in the company’s history, with 15% year-over-year growth, and the second largest quarter overall following the record that was set in the second quarter this year.”

A few weeks ago Herbalife announced it had entered the $38 billion coffee category, starting from the U.S. Apart from this, the company introduced during the last quarter, a total of 58 products in its 51 markets.

Following the the third quarter, Herbalife targets 6.5%-10.5% sales increase for the last quarter and 9.9%-10.9% for the whole year versus last year. If achieved, Herbalife will be ending the year with a revenue of very close to $5 billion.

For more on Herbalife’s Q3 results, please click here and here.

NATURA

Natura’s net sales in the third quarter was up 37% versus prior year. A significant part of it came from the acquisition of The Body Shop. Even without this though, the consolidated quarterly revenue growth was 17%.

Natura’s business now consists of three segments and each of them posted positive growth figures last quarter: Natura 4.5%, The Body Shop 277% (not comparable because of the timing of acquisition), and Aesop 67%.

Following these results, management said, “With double-digit growth in revenue and adjusted EBITDA and net income more than doubling, Natura &Co posted another quarter of solid performance, providing new evidence of the growing momentum and strength of our global, multi-brand, multi-channel group. All three of our brands and businesses continued to contribute to a very satisfactory underlying performance.”

Management was quite happy with the results in Brazil, Natura’s home country. Sales grew by more than 9% in Brazil in Q3. Along with its direct selling channel, Natura has been opening and running retail stores in Brazil. It was announced that the number of these has reached 31 now with the opening of 12 new stores throughout the country last quarter. Natura Brazil has more than 1 million consultants on the field.

For more on Natura’s Q3 results, please click here.

NU SKIN

Nu Skin came up with a strong 20% revenue increase in Q3 as compared to last year’s third quarter ($675 m vs. $564 m). Nu Skin’s all regions posted positive revenue growths in the last quarter. The performance in Mainland China was especially impressive (31%), contributing $54 million to this increase. Southeast Asia brought 21% growth. During the investors call, Nu Skin said its product Lumispa had accounted for $74 millon sales in Q3.

“We delivered strong year-over-year financial results with reported revenue growth in every region,” said Ritch Wood, CEO of Nu Skin.“This is our fourth consecutive quarter of revenue growth of 20% or more, driven by the continued execution of our growth strategy focused on engaging platforms, enabling products and empowering programs which led to solid customer growth of 9% and sales leader growth of 14%.”

Nu Skin’s total revenue after the first three quarters is $1.996 m which is 24% above last year. For 2018, management announced they had increased their annual revenue guidance to be between $2.66  and $2.68 b, expecting $665 to $685 million in the last quarter.

For more on Nu Skin’s Q3 results, please click here and here.

ORIFLAME

Oriflame’s global sales declined by 1% in the third quarter from €295.3 million to €292.5 on a year-over-year basis. Company’s nine-month sales growth performance is below last year’s, too (-4%).

The only region that came with a positive growth in Q3 was Europe & Africa (+4%). Sales in Asia & Turkey and Latin America units were stable (0% growth). CIS reported the worst among all: -8%.

Active consultants in the quarter was stable, amounting to 2.7 million. Oriflame’s unit sales decreased by 3% and the price/mix effect was up by 7%, driven by mix. The positive mix effect, as reported, was mainly driven by skin care and wellness lines.

CEO Magnus Brannstrom commented on the quarter results, “We entered the third quarter facing continued challenging market conditions in some of our key markets… Measures focused on driving activity and recruitment to enhance sales growth in CIS and Latin America have proven successful… The performance in Asia & Turkey was slower during the second part of the quarter, partly as a result of the macroeconomic conditions in Turkey and lower activity in China. Sales development into the fourth quarter is slightly above the previous quarter and actions focused on driving activity and recruitment are ongoing.”

For the developments on the digital platforms, management said the transition to mobile devices continued to increase. More than 95% of the orders were placed online, of which 40% were placed on mobile devices. Key activities during the quarter included the continued rollout and development of the company’s e-commerce capabilities and further investments to the Oriflame App Suite.

For more on Oriflame’s Q3 results, please click here.

TUPPERWARE

Tupperware reported $486 million sales, down 10% versus last year. Sales in its Europe business unit increased by 1%, led mainly by South Africa (+16%) and CIS (+10%) and offset by Tupperware’s “established” markets in Europe. Asia-Pacific’s sales decreased by 8%, North America’s by 11% and South America’s by 24%.

Leading worse-performing markets in the third quarter were: Indonesia (-31%), India (-27%), Brazil (-23%). Tupperware United States and Canada sales were down 3%, too. Management said this year-over-year decrease was due to a “blockbuster campaign” in July 2017 that was not repeated in Q3 2018.

For the rest of the year, Tupperware expects -9% to -7% growth in the fourth quarter and to close the year by -7% to -6%. Management reports “there is a negative 2-point impact in the 2018 full year sales comparisons from the closure of Beauticontrol in 2017 and the combination of NaturCare and Tupperware in Japan, effective at the beginning of 2018.”

Tupperware recently introduced a nutritional line in China. Currently, this line is being sold in the outlets and regionally. Eventually, it is expected to be sold online.

During the earnings call, CEO Patricia Stitzel was proudly announcing they had their first e-commerce launch for Europe, in Germany, providing the sales force with their own personal websites with e-commerce functionality… Well, having been so late, it seems Tupperware needs to hurry on the digital platforms if they want to make Tupperware a relevant brand.

For more on Tupperware’s Q3 results, please click here and here.

USANA

USANA’s third quarter sales was $297 million, representing an an increase of 13% year-over-year (vs. $262 million). As far as regional performances were concerned, North Asia grew by 27%, Greater China by 23% and Southeast Asia- Pacific region by 12%. Sales in the Americas & Europe region decreased by 9%.

CEO Kevin Guest commented, “USANA generated very strong results for the third quarter, notwithstanding the notable strengthening of the U.S. dollar both year-over-year and sequentially. Our growth is due to the momentum we continue to see across most of our markets. For instance, local currency net sales in five of our markets grew by more than 20% during the quarter. Five additional markets grew by more than 10% as we had several additional markets grow.”

With this third quarter performance, USANA’s first nine months’ revenue is 15% higher than last year same period’s.

The management updated its outlook for the whole year of 2018 and announced its sales expectations as “between $1.185 and $1.2 billion”. This was previously $1.17-$1.2 billion.

Regarding the internal investigation of China operations (i.e. “BabyCare Ltd.”), USANA said the company had assumed direct responsibility for reviewing the matters and  hired an experienced counsel to conduct the investigation. The Company added, it did not believe the amounts would materially impact its financial statements, but it could also not predict the outcome of this investigation.

For more on USANA’s Q3 results, please click here and here.

Will the fourth quarter be better than the first nine-month performances for these direct sellers? We will have to wait and see…

Please click links for these companies’ 2018 Q1 and Q2 reviews.

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Hakki Ozmorali is the Principal of WDS Consultancy, a management consulting firm in Canada specialized in providing services to direct selling firms. WDS Consultancy is a proud Supplier Member of the Canada DSA. It is also the publisher of The World of Direct Selling, global industry’s leading weekly online publication since 2010. Hakki is an experienced professional with a strong background in direct sales. His work experiences in direct selling include Country and Regional Manager roles at various multinationals. You can contact Hakki here.

The post Third Quarter in Sales Figures appeared first on The World of Direct Selling.

AVON

Avon’s second quarter global revenue was down 3% from last year previous quarter ($1.352 b vs. $1.396 b). Still, Avon’s 2018 first-half growth (Q1+Q2) is almost 1% above 2017.

Out of the four regions of Avon, only EMEA reported sales growth in the first quarter (+1%). North Latin America was at par with last year, Asia & Pacific was down 1%, and South Latin America down 8%. Avon saw active representative losses in all of its four regions, ending with 4% global decrease. Active representative declines in Brazil, Russia and Mexico were specifically noted.

Management commented that Brazil had impacted overall revenue performance this quarter significantly, in part due to the impact of the truckers’ strike that prevented orders, deliveries and delayed cash collection. Without this impact, Avon’s global revenue would have been -1%.

CEO Jan Zijderveld said, “Entering my seventh month at Avon, I am encouraged by improved revenue growth in three of our top five markets… However, we are not yet satisfied with the overall operating results of the quarter… We are prioritizing achieving profitable, sustainable top line growth by focusing on our representative experience and satisfaction through enhanced training for 500,000 representatives in the second half, as well as new sales incentives programs, better service and improved forecasting… And, finally, we are placing digital at the center of all actions to drive our future progress.” Mexico, Argentina and Philippines were those three top markets Zijderveld mentioned that had grown in Q1.

During the second quarter, Avon completed the early redemption of its 2019 bonds (worth $238 million) in an effort to to reduce its debt and strengthen its balance sheet. This move brought Avon’s gross debt down to $1.6 billion as of June 30.

Avon has also made significant changes in its top management recently: Benedetto Conversano was appointed to the newly-created role of SVP, Chief Digital & Information Technology Officer; Anna Chokina was appointed to VP, Global Brand Marketing, Skincare and Personal Care; Elena Degtyareva to VP, Global Fashion and Home; Amy Greene to VP, Investor Relations; and has added new Country General Managers in Russia & Eastern Europe; in Italy & Mediterranean region, and in the Asia &Pacific.

For more on Avon’s Q2 performance, please click here and here.



HERBALIFE

Herbalife reported a remarkable revenue growth for the second quarter: Net sales of $1.3 billion, an increase of 12% compared to the second quarter of 2017. Of the five regions, four grew. Company’s highest growth came from its North America region (20%). It was followed by China (18%), EMEA (16%),  Asia & Pacific (7%), and Mexico (2%). The only negative growth was reported by South & Central America (-5%).

Satisified with the results, CEO Rich Goudis said, “Our top-line growth rate accelerated in the second quarter reflecting the strength of our business model to provide solutions to many of today’s global nutrition and wellness megatrends.”

In Q2, Herbalife continued to expand its product portfolio, launching a total of 35 products globally.

Management announced its 2018 outlook as: 9-14% net sales growth in the third quarter and 8-12% in 2018 versus 2017. This forecast, if achieved, will take Herbalife very close to becoming a $5 billion revenue-company, once again after 2014. Company’s 2018 mid-year revenue realization is 9.5% above last year’s.

For more on Herbalife’s Q2 performance, please click here and here.

NATURA

Natura’s consolidated net revenue increased by 53% to R$3.1 billion in the second quarter. R$2.06 b of this came from its Natura unit, R$807 m from The Body Shop and R$236 m from Aesop. At R$ 5.8 billion, company’s first half-2018 growth is 54% up from 2017.

İn Brazil, Natura’s sales grew by 7% in Q2. This was achieved despite the disruptions from the truckers strike and the World Cup. The rest of Latin America’s performance was on the other hand, +21%. Management’s comment on the results from Mexico and Argentina were “robust”. The Body Shop’s quarterly sales was down 12%,

Roberto Marques, Natura’s Executive Chairman of the Board stated, “We are very pleased with these results. Natura has revitalized its business model through its revamped relationship selling approach, digitization and growing multichannel presence; The Body Shop’s ongoing transformation plan is delivering initial results and Aesop continues its stellar growth trajectory. Natura &Co is well positioned to deliver further growth, reach its medium-term and long-term ambitions, and create triple bottom line value through continued advances in sustainable business practices.”

For more on Natura’s Q2 performance, please click here.

NU SKIN

Nu Skin announced very strong second-quarter results with revenue of $704.2 million, up 28% over the prior-year period. Nu Skin’s first six months sales growth is also 26% above last year.

Quarterly sales in China was up 41%, Southeast Asia 31%, Americas/Pacific 25%, Hong Kong/Taiwan 21%, EMEA 15%, and South Korea 5%. The only business unit that reported a sales decline was Japan (-1%). Among these seven regions, China is Nu Skin’s largest region, generating 35% of Nu Skin’s global volume.

“Based on our strong first-half results, with double-digit growth in both the first and second quarters, we now see revenue growth of approximately 15 to 17% for the year,” commented, Ritch Wood, Chief Executive Officer.

In fact, Nu Skin announced it expected $650 to $670 million revenue during the third quarter (i.e. 15% to 19% growth), and $2.63 to $2.67 billion as of end-2018.

For more on Nu Skin’s Q2 performance, please click here and here.

ORIFLAME

Oriflame’s global sales decreased to EUR 309 million from EUR 348 million in Q2 of 2017. Company’s 2018 first half growth performance was down 7% as well.

The number of registered active field members in the quarter decreased by 1% to 2.8 million.

Negative growth in the second quarter was widespread in Oriflame’s regions: Asia & Turkey (-1%),  Europe & Africa (-3%), Latin America (-10%) and finally, CIS (-19%). Asia & Turkey is currently company’s largest region, accounting for about 40% of its global sales.

CEO Magnus Brännström commented, “Despite facing significant currency headwinds, we are pleased to report an improved operating margin for the quarter. However, the overall sales development during the second quarter was weak due to challenging market conditions in key markets such as Russia, Indonesia and Turkey.”

For the third quarter of 2018, management announced that the year to date sales development was approximately +4% in local currency and the development in the third quarter to date was approximately +5% again, in local currency.

As the long terms, the aim was announced as achieving local currency sales growth of approximately 10% per annum.

For more on Oriflame’s Q2 performance, please click here.



TUPPERWARE

Following a negative growth in the first quarter (-2%), Tupperware’s second quarter was also a disappointment: Net sales in Q2 was US$535 million, 7% down from last year’s same period (US$573 m). Maybe worse than this overall figure was that sales decrease was present in all regions.

Acknowledging the current not-so-good situation, the newly appointed CEO of Tupperware Tricia Stitzel is optimistic about the future: “We do acknowledge that we must perform better across the global portfolio. I am confident that with this dynamic team of experienced leaders and the 3 million entrepreneurs in our sales force, we will be able to innovate and execute to solidify our position as a thriving global brand.“

At the markets level, South Africa (+27%), China (+20%), CIS (+13%), Mexico (+6%), Germany (+2%), and US & Canada (+2%) came up with better results in the last quarter. On the other side, there were big disappointments: France (-29%), India (-29%), Indonesia (-23%), and Brazil (-21%).

As a result, Tupperware’s share price went down to US$ 34 that is drastically lower than US$ 96 when it had peaked at the end of 2013.

Similar to Avon’s move, Tupperware has also recently announced major executive appointments: Asha Gupta as Executive VP and Chief Strategy and Marketing  Officer, Stein Ove Fenne as Group President of EMEA, Jim Bellonz as President of U.S. & Canada, and Justin Hewett as Group President of Asia Pacific.

For the rest of 2018, management announced it expected 10-12% revenue decrease in the third quarter vs. Q3 of 2017, and 6-7% decrease for full 2018 vs. 2017. This means Tupperware will only be able to achieve a yearly revenue in 2018 (approx. US$ 2.1b) that it was making 9-10 years ago.

For more on Tupperware’s Q2 performance, please click here and here.

USANA

For the second quarter of 2018, USANA’s net sales were US$301.5 million, compared with US$257.1 million in the prior-year period, an impressive 17.3% increase year-over-year. With this, its net sales for the first six months exceeded US$593 million. This is more than the figure USANA had achieved during the whole year only seven years ago in 2011 (US$582 million).

USANA’s regional revenue growth performances in Q2 were as follows: North Asia 36%, Greater China 23%, Southeast Asia & Pacific 13%, and Americas & Europe 4%. Asia & Pacific countries altogether generate 80% of USANA’s sales, and Americas & Europe account for the remaining 20%. During the quarter, USANA expanded into four new European markets: Germany, Spain, Italy and Romania. Management said the launch of these markets had gone very well and the initial operating results had been positive.

“Our operating results for the second quarter exceeded our expectations and reflect the momentum we are seeing in most of our regions. This momentum helped us generate the highest quarterly revenue and earnings per share in the Company’s history,” CEO Kevin Guest commented on the results.

The Company has updated its net sales outlook for 2018 as between $1.17 and $1.20 billion (previously it was between $1.13 and $1.17 billion).

Currently, USANA’s market value is approximately US$3 billion. Only a year ago in August 2017, USANA was valued at US$1.4 billion. To compare, today Avon’s market capitalization is less than US$1 billion and Tupperware’s is less than US$2 billion.

For more on USANA’s Q2 performance, please click here and here.

This analysis covers how seven of the largest direct selling companies have done so far in 2018. We will need to wait to see how they will perform in the rest of the year.

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Hakki Ozmorali is the Principal of WDS Consultancy, a management consulting firm in Canada specialized in providing services to direct selling firms. WDS Consultancy is a proud Supplier Member of the Canada DSA. It is also the publisher of The World of Direct Selling, global industry’s leading weekly online publication since 2010. Hakki is an experienced professional with a strong background in direct sales. His work experiences in direct selling include Country and Regional Manager roles at various multinationals. You can contact Hakki here.

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The post Mid-Year Growth Performances of Major Direct Sellers appeared first on The World of Direct Selling.