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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The post A Glance at the Direct Sales Industry in Mid-2020 appeared first on The World of Direct Selling.

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.

Let’s take a look at these companies’ sales performances one by one…



AVON

Following the third quarter results, Jan Zijderveld, Avon CEO, said, “We continue to execute our Open Up turnaround strategy, with productivity gains driving adjusted operating margin expansion and improved free cash flow… As expected, revenues declined as we continued to make sharper choices designed to drive a healthier, more sustainable and more profitable business.” The four pillars of Avon’s Open Up Strategy is as follows:

In fact, Avon’s global revenue declined by 17% for the quarter versus last year, to $1.2 billion. All four regions reported declines: South Latin America -23%, Asia-Pacific -12%, North Latin America -11%, and EMEA -10%.

During the earnings call with the investors, management said they were focusing on “digital”, saying they had been “kick-starting the development of Avon beauty entrepreneurs as Avon influencers and bloggers to accelerate social selling,” and added, they would “continue to expand new digital tools that enable consumers to shop anywhere, anytime, and improve representative’s experience with better digital tools and training to run her business.”

Avon is aiming to expand its digital reach by initiating a “School of Bloggers” to help Avon’s micro-influencers develop social networks that get them closer to the customers and attract a new generation of representatives.

In 2018, Avon had an 8% reduction in its head count and continued this in the first half of 2019 with a further 15% reduction. As a result, Avon announced it had reduced the total workforce from 25,000 people in 2017-2018 to less than 20,000 today. It also have so far reduced the number of SKUs by 21%.

Earlier this year, it was announced that Natura, the cosmetics giant from Brazil would acquire Avon. This transaction is expected to be finalized early in 2020.

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

HERBALIFE

Herbalife’s third quarter net sales of $1.2 billion meant a slight increase (0.1%) compared to the third quarter of 2018.

Asia-Pacific region reported 18% growth in Q3, North America 7%, and EMEA 3%. Sales in China was drastically down by 22%. However, this is still an improvement as the previous quarter revenue growth in China was even worse (-35%). South & Central America and Mexico business units reported declining sales, too (-9% and -4%, respectively).

Commenting on the China market, CEO Michael Johnson said, “As we projected last quarter, the trends in our China business improved in the third quarter and our recovery in that market is on track. The strategies in China are progressing. And we continue to expect further improving trends in the fourth quarter.”

Herbalife management announced their full-year sales outlook as between -1.2% and 0.1% for 2019. For 2020, though, Herbalife aims at growing again (by between 1% and 7%). As you can see on the chart above, Herbalife has not been able to increase its sales in the last five-year period.

In a separate press release following the quarterly results, Herbalife announced its CEO transition plan that would go into effect in March 2020. According to this, Michael Johnson who has been serving as CEO on an interim basis, would remain as the Chairman of the Board, and Co-President and Chief Health and Nutrition Officer John Agwunobi would become the new CEO.

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

NU SKIN

“Revenue came in slightly below expectation, primarily due to the challenging regulatory environment in Mainland China, where meeting restrictions continued throughout the quarter. Despite this, our sequential sales leader trends stabilized both in China and globally, and recent product introductions and business incentives drove year-over-year increases in customer acquisition,” commented Ritch Wood, CEO of Nu Skin.

Nu Skin reported $590 million revenue in the third quarter which was 13% less than last year same quarter’s figure ($675 million). The highest decrease came from China (-23%), company’s largest region that generates more than 1/3 of its global volume. In the third quarter, Nu Skin’s all regions but Japan (+2%) reported negative growths.

For the whole year, management expects its revenue to be between $2.41b-$2.43b in 2019. This is 9-10% lower than Nu Skin’s 2018 sales.

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

TUPPERWARE

Apparently, Tupperware’s difficult times are not over. It reported declining sales for the third quarter in a row this year. The first quarter was -10%, the second was -11%, and this last quarter’s revenue growth performance was -14%.

On the regional level, South America reported -17%, North America -16%, Asia-Pacific -12%, and Europe, also -12%. Tupperware’s active sales force was 546,000, down 8% from last year’s same period.

“Sales for the third quarter ended in line with our forecasted guidance as the challenging trends we’ve been experiencing in Brazil, China, and US and Canada persisted as we expected,” said Tricia Stitzel, company Chairman and CEO. “We understand that we need to live up to the challenges of being a competitive global business and we need to drive rapid improvement. We can and we will,” she added.

As far as the year-end forecast is concerned, the management expects a 12-14% sales decrease as compared to 2018. This will be Tupperware’s lowest yearly sales in more than a decade.

Tupperware shares tanked last Friday, after the company said it would suspend dividends. Tupperware share price is down 67% as compared to beginning of 2019.

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



USANA

Following the disappointments in the first and the second quarters (7% and 15% declines in sales, respectively), USANA reported a negative growth in the third quarter as well: -12%.  USANA’s total number of actives at the end of the third quarter was 558,000, compared to 615,000 in the prior-year period.

CEO Kevin Guest said, “Although we continue to face a challenging sales environment in China and other regions, we were pleased to see sales in several markets improve on a consecutive quarter basis… We also recognize, however, that we still have work to do in the Southeast Asia Pacific and Americas/Europe regions towards regaining sales momentum.”

All regions contributed to the declining sales in Q3: The largest region China was down 19%, North Asia was again, -17%, Americas & Europe -9%, and Southeast Asia Pacific -8%. China generates more than half of company’s global volume and sales in this region was down 23% in the second quarter, too.

Management announced USANA would be hosting its Annual China Sales Meeting in November. 10,000 people are expected to attend this event in Macau and at this event, the attendees will be offered “a preview USANA’s plans for China in 2020”.

At the end of the quarter the company updated its sales outlook for 2019 as between $1.030 billion and $1.045 billion (was previously between $1.020 and $1.060 billion). This outlook shows USANA’s year-end sales will be less than last year’s ($1.189 billion).

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

Click this link for our previous Quarterly Reviews of major direct selling companies.

…..

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 Means Declining Revenue for Some Major Direct Sellers appeared first on The World of Direct Selling.

This week I have the quarterly growth analysis that I have been doing for several years. It focuses on the largest public direct sales companies and as far as I am concerned, gives an insight on the global industry’s direction.

Previously, this analysis had included Oriflame as well, but as this company decided to go private (i.e. its shares would not be traded on the stock exchange) last May, we no longer have access to its public figures.

AVON

Avon’s second quarter revenue was $1,174.8 million, down 13% from 2018 Q2. All of its four regions reported declining sales last quarter: EMEA -15%,  South Latin America -14%,  North Latin America -7%, and Asia-Pacific -4%. Active representatives declined 10%, too, with decreases reported in all regions.

Jan Zijderveld, Avon CEO, said, “We continued to execute our Open Up strategy, with pricing and productivity gains which drove adjusted operating margin expansion and improved free cash flow. Our focus on productivity in the second quarter, including less discounting, more effective incentives, optimizing promotions and more favorable mix, led to a 5% improvement in average representative sales with price/mix up 9%.” This clearly showed management’s focus was on productivity and profitability rather than growth.

Miguel Fernandez, Global President, explained how their focus had been shaping in terms of recruiting new reps. He said, “The previous recruiting narrative that we had in the company for many years was ‘Come to Avon because you’re going to get great products at the best price’. So, in many cases we were recruiting the consumer that was looking for a discount… We’re stepping away from that.”

You will remember that Avon was acquired by Natura, the cosmetics giant of Brazil in last May. This acquisition is expected to be completed by early 2020.

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



HERBALIFE

Herbalife reported net sales of $1.2 billion, a decrease of 3.5% compared to the second quarter of 2018. The worst performance came from China: -35%. South & Central America came up with -13%. Remaining four regions of Herbalife reported positive figures: Asia-Pacific 18%, North America 6%, Mexico 3%, and EMEA 1%. Excluding China, its net sales grew 5.4%.

Chairman and CEO Michael Johnson said, “Our second quarter results were within our guidance range. We delivered year-over-year net sales growth in 4 of our 6 regions. We reported year-over-year net sales growth in 8 of our top 10 countries. However, we recognize China is an issue and we have a plan in place that is working.”

Herbalife’s growth expectation for the whole year of 2019 is between -1.7% and +2.8%.  As of mid-2019, Herbalife’s sales is down 2% versus last year.

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

NATURA

Natura’s consolidate sales was up 10% in the second quarter, reaching R$ 6,319 million (approx. USD 1.6 billion) as of mid-year.

Natura & Co.’s consolidated reporting currently includes Natura, The Body Shop and Aesop. Natura’s own revenue was up 7% in the first half, The Body Shop’s 9%, and Aesop’s 27%.

Commenting on the results, Natura & Co. Chairman Roberto Marques was happy, saying, “All three of our existing brands contributed to this strong performance. Natura posted a sharp improvement in Brazil despite a weak CFT market… The Body Shop’s transformation is advancing. Sales grew despite the closure of underperforming 37 stores… Aesop’s profitable growth continues.” Then, he added the acquisition of Avon was “a decisive step in the creation of a multi-brand, multi-channel, purpose-driven group.

Currently, units’ shares in the group revenue are as follows: Natura 63%, 28%, and Aesop 9%.

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

NU SKIN

“Our second-quarter results were negatively impacted by limited sales meetings, media scrutiny and consumer sentiment in Mainland China in connection with the recently completed 100-day review of the nutrition and direct sales industries,” said Ritch Wood, CEO of Nu Skin.

Nu Skin reported $624 million sales last quarter. This was 4% less than last year same quarter’s figure ($704 million). Of the seven regions, only Japan reported growth (2%) and China dropped the most (-24%). China is Nu skin’s biggest market with its more than 1/3 share in the global sales.

During the earnings call following the quarter results, Nu Skin management stressed the fact that China would remain as their top priority. They explained three specific initiatives: Launch of a new product, new business incentives to improve sales leader productivity, and initiatives focusing on customer acquisition and retention including a new customer referral program.

Management’s revenue expectation for 2019 is:  $2.48 billion to $2.52 billion or -6% to -8%. Nu Skin’s 2019 mid-year revenue is 7% less than last year’s.

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

TUPPERWARE

Tupperware’s second quarter sales performance was far from being satisfactory: $475 million (-11% as compared to last year same quarter). All regions reported negative figures, Asia-Pacific and South America leading them (each with -14%).  Tupperware’s global sales force decreased to 565 million, representing a 9% decline.

“Overall, the business fell short of our expectations in some markets as geopolitical concerns and lower consumer spending headwinds in two of our key markets resulted in a miss of our local currency sales expectations,” said Tricia Stitzel, Chairman and CEO of Tupperware.

Tupperware expects an annual sales decline of between 9-11% in 2019. Tupperware’s sales had decreased by 8% in 2018. In fact, the company reported positive growth only in one year (2017) during the past five years. Tricia Stitzel commented on the future,  “This is the three-year endeavor that may be bumpy at times, we’re tasked with turning a large ship and bringing along a family of over 3 million individual sellers with us.”

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



USANA

USANA reported quite disappointing results for the second quarter: Global sales was down 15% versus last year (USD 256 m vs. USD302 m). During the first quarter, USANA had come up with negative growth as well (-6.5%).  Consequently, company’s mid-year growth is 10% behind last year.

The worst figure came from USANA’s largest business region of the four, China. Sales in China was down 23% and accounted for about 70% of the total decline in USANA’s sales. Americas & Europe (-15.9%) and Southeast Asia Pacific (-1.5%) also reported declining sales. The only positive situation was in North Asia (+19%), company’s smallest business unit.

Commenting on the results, CEO Kevin Guest said, “The continuing challenging market environment in China was the major factor that impacted our second quarter results. During the second quarter, we offered promotions and incentives in China that have historically generated meaningful sales and customer growth. However, the contribution of these promotions was significantly lower than we anticipated, which we believe is due to the low consumer sentiment toward health products in China.”

USANA management announced the net sales outlook for 2019 as “between $1.02 billion and $1.06 billion”. This is significantly lower than their expectation after the first quarter (was between $1.21 billion and $1.26 billion). If this revised projection happens, USANA will be reporting an annual sales decline for the first time after several years of substantial sales increases.

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

Generally speaking, the picture was not bright at all as a whole for these giants in the first half. Let’s see how their performances will evolve during the second half.

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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 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 Direct Selling Giants’ Growth Performances, Mid-2019 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.

This week’s article will be a review of six of the largest public direct sales companies’ 2017 growth figures. Although they cannot represent the whole global industry, how these “biggies” have been doing surely gives an idea:

AVON

Avon’s Q4 2017 sales was at par with its previous year same period sales: Approximately $1.6 billion. This brought the company to $5.7 billion which was also almost the same as Avon’s 2016 performance.

Avon’s largest region South Latin America grew by 4% to $2.2 billion in 2017. The rest of the three regions concluded the year with negative growths: Asia-Pacific -6%, North Latin America -4% and finally, Europe, Middle East & Africa -1%,

The weakening on the field was even worse with the company’s active representatives declining by 3% in 2017. All four regions contributed to this with their negative performances.

Besides the not-so-good news from the revenue side, Avon management’s reports on the profit side made the investors happy this time: Avon realized more than $250 million of cost savings, exceeding its target of $230 million for 2017. This impacted its profitability positively and increased its operating profit by 21% in Q4, bringing a net income both quarterly and annually. This was the main reason that moved Avon’s share price from $2.14 to $2.94. It was only a few weeks before that, some of Avon’s institutional shareholders were so pessimistic that they had wanted the company to sell itself to an investor.

Jan Zijderveld, the newly-appointed CEO of Avon said, “Many people have asked me why I was attracted to this role… I came here because I can make a difference. Avon is operating in a dramatically changing consumer and competitive environment and business as usual is not an option. The Board has given me a clear mandate to dive deeply into all aspects of this business.”

Avon management did not expect the closure of Australia and New Zealand that will happen this year to have any negative impacts. CFO Jamie Wilson said the business there had been a net loss position for a number of years and with the exit, that loss would no longer hit their results.

In January this year, New Avon, the North American unit that Avon had sold before, launched a food supplements line and got into a new category. Whether if and when these products will be made available in Avon’s other markets has not been disclosed yet.

For more on Avon’s 2017 performance, please click here and here.



HERBALIFE

Herbalife’s revenue growth in the last quarter was 5%, bringing the quarterly sales to approximately $1.1 billion. Despite this, company’s sales was down 1% on an annual basis.

EMEA was the most successful of Herbalife’s regions in 2017 achieving a 7% growth. With its $869 million annual volume, EMEA is now company’s third largest region after Asia-Pacific (0% growth in 2017) and China (2% growth in 2017). Mexico’s sales declined by 1%, South-Central America’s by 3% and last but not least, North America’s by 12%.

The revenue decrease in North America was $116 million last year, taking it from its “pole position” to fourth in one year. CEO Rich Goudis said during the earnings call that this decline had slowed down in the US: -19% in Q2, -17% in Q3 and -8% in Q4.

“After a year of transition, we returned to net sales growth in the fourth quarter as expected, and we anticipate stronger net sales growth for the full year in 2018,” said Rich Goudis. For 2018, Herbalife’s expectation is to reach a net sales growth of 5.5 to 9.5% versus 2017.

Herbalife announced a new executive organization structure effective May 1, 2018. According to this, President Des Walsh is transitioning to the new role of Executive Vice Chairman. Concurrently with this, CFO John DeSimone will assume the role of Co-President and Chief Strategic Officer. Current Sr. VP Bosco Chiu will be promoted to Executive VP and CFO, general counsel Richard Werber will assume the new role of Chief Legal Officer and Sr. VP and Chief Compliance Officer Henry Wang will be promoted to Executive VP and General Counsel.

For more on Herbalife’s 2017 performance, please click here and here.

NU SKIN

Thanks mainly to the growth performances achieved in China (+18%) and its Americas region (+15%), Nu Skin achieved 3% sales increase in 2017, globally. These two regions’ Q4 growths were exceptionally phenomenal: Quarterly revenue increase in China was 60% and in Americas it was 33%. These two regions together generated 45% of Nu Skin’s volume. In fact, Nu Skin has not much business in the U.S. Company’s CFO Mark Lawrence said during the earnings call, “… the vast majority of our revenue and all of our profit, virtually all of our profit is overseas.”

EMEA’s annual revenue was up 9% in 2017 and South Asia/Pacific’s 1%, whereas South Korea ended up with -13%, Hong Kong/Taiwan with -9%, and Japan -8%.

Last year’s $2.279 million revenue also meant the end of a three-year-long era of declining sales for Nu Skin. This also put the company ahead of Tupperware as of end-2017. But still, Nu Skin’s 2017 sales is far from its 2013 revenue when it peaked at $3.177 million.

“We concluded 2017 on a high note with solid quarterly results driven by customer and sales leader growth.Our growth strategy, which remains focused on three key elements – engaging platforms, enabling products and empowering programs, continues to drive our positive results,” said Ritch Wood, Nu Skin’s CEO.

For 2018, Nu Skin announced it expected annual sales of $2.44 billion to $2.49 billion, and if this happens, that will be a 7 to 9% growth.

For more on Nu Skin’s 2017 performance, please click here and here.

ORIFLAME

Oriflame closed the year with an impressive 9% revenue increase. The company’s fourth quarter sales was EUR 380 million (up 7% from last year) and the year-end result was EUR 1.363 million. Despite this, Oriflame’s annual sales in 2017 still was lower than that of 2013 (EUR 1.407 million).

Unit sales in Q4 increased by 4% and the price/mix effect was up by 10%. This positive mix effect was attributed by management to “a combination of geographic and product mix, mainly driven by skin care and wellness”.

The positively contributing regions to this yearly 9% global sales increase were: Asia & Turkey (17%), CIS (10%), and Latin America (6%). The only sales decrease came from Europe & Africa (-1%). For several years, CIS region (Armenia, Azerbaijan, Belarus, Georgia, Kazakhstan, Kyrgyzstan, Moldova, Mongolia, Russia, Ukraine) has been a headache for the company with its continuously diminishing sales. This region (Oriflame’s second largest after Asia & Turkey) succeeded to report Euro sales growth in each of the four quarters in 2017.

CEO Magnus Brannstrom was happy with the results saying, “2017 was another year of healthy Euro growth and double-digit local currency growth. We delivered very strong profitability improvements…  Our strategic categories – Skin Care and Wellness sets and routines –  served as significant drivers of growth and price mix development.” In fact, Oriflame’s skin care (28%), and wellness (11%) categories together accounted for 39% of its global sales in 2017.

Oriflame management also announced that 94% of company’s global orders were placed online last year and approximately 2/3 of visits to its websites came from mobile devices.

For more on Oriflame’s 2017 performance, please click here.



TUPPERWARE

Following $589 million sales in the last quarter of 2017 (down from last year same period), Tupperware ended the year with $2.256 billion sales. Apart from South America (+6%), all of its regions brought negative growths in 4Q.

This situation was the final result for whole of 2017, too. On an annual basis, sales in South America increased by 20%, whereas each of Europe and Asia-Pacific reported -2% and North America -1% revenue growth. So, basically in 2017, Tupperware owed its 2% global sales increase to South America’s 20% regional growth.

At the markets level, Tupperware’s stars in the last quarter of 2017 were China (+33%), CIS (-18%), Mexico (+13%) and Brazil (+4%). Brazil is Tupperware’s largest market with its volume exceeding $300 million. China made over $200 million and has become the third largest (US & Canada, the second). Among those that disappointed were Indonesia (-21%), India (-19%), Italy (-12%), South Africa (-7%), and France (-6%).

In the fourth quarter, Tupperware announced it would close down its manufacturing and supply chain facilities in France. Management admitted during the earnings call that while they found it a necessary move, it impacted both the sales force and the consumers, resulting in undesirable numbers especially in France, Germany and Italy in the end.

After having declining sales for three consecutive years since 2013, last year was the first with a positive growth. For 2018, Tupperware announced it expected 2 to 4% sales increase, globally. Assuming the high-end (4%) is achieved ($2.346 b), Tupperware’s global sales will still be lower than that of its 2014 figure which was $2.606 b.

Tupperware last week announced Patricia A. Stitzel as the new CEO. Rick Goings has been at this post since 1996 and from now on, he will serve as Executive Chairman.

For more on Tupperware’s 2017 performance, please click here and here.

USANA

USANA reached another record high sales in 2017: $1.047 billion. In fact, it succeeded in increasing its revenue each and every year during the last decade. In seven of the last 10 years, company’s growth was double-digit:

For the fourth quarter of 2017, the revenue was $273 million compared with $253 million in the prior-year period, representing an 8.0% increase. This was the highest quarterly sales in company’s history, as reported by the management. North Asia’s year-over-year quarterly growth was 25%, Greater China’s 14% and Southeast Asia-Pacific’s 4%. Sales in Americas-Europe region decreased by 5%.

During 2017, company had  announced its plans for a mid-2018 entry to four new European markets: Germany, Spain, Italy and Romania. It said products now have been available to preferred customers on a not-for-resale basis in these countries.

Currently, more than half of USANA’s volume is being generated in China where it has been dealing with a problem. It was announced in February 2017 that the company had been voluntarily conducting an internal investigation of its operations there, focused on compliance with the foreign corruption regulations. USANA says at this time it cannot predict the duration, scope, or result of the investigation.

For 2018, the company expects its net sales to be between $1.11 and $1.16 billion, a growth of 6.0%-10.8%.

For more on USANA’s 2017 performance, 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 2017 in Growth Numbers: Avon, Herbalife, Nu Skin, Oriflame, Tupperware, USANA appeared first on The World of Direct Selling.

AVON

Following the less-than-satisfactory results in the first quarter, there were hopes the second quarter would be better for Avon. This did not happen, though.

Company’s revenue decreased on a year-over-year basis by roughly 3%. There was a 3% decline in the number of representatives, too.

South Latin America reported 4% sales increase during the quarter. There were negative figures in all others: North Latin America -5%, EMEA -6%, and Asia Pacific -7%.

At the markets level, Russia and Brazil each grew by 7%. Mexico’s revenue was down 9%, Philippines’ 10%, and the UK’s was down 20%. In the UK, both the active representatives and the average order declined.

During the earnings call, management stated three reasons behind the poor performance in the second quarter: 1) Issues faced in the segmentation of Avon’s color cosmetics portfolio, 2) Dissatisfaction caused among reps in Mexico due to not being able to meet the increased demand, 3) Disruption in some markets, the U.K. being on top of the list.

Avon’s CEO Sheri McCoy said, “While we anticipated some challenges, second quarter performance fell below our expectations.” Following this last quarter, it was officially announced that McCoy would step down from the CEO role and also from the Board at the end of March 2018.

Sheri McCoy was appointed in April 2012 as Avon’s CEO. Since then, Avon has not been able to report an annual sales increase. It seems 2017 will be just another one. The same month McCoy was appointed, cosmetics giant Coty made an offer to acquire Avon for $10.7 billion . Then, Coty withdrew its offer saying it had taken too long for Avon respond. At the time Avon shares were valued at around $24, and now it is less than $3!

From a market capitalization perspective, Avon is now worth about 1/5 of Herbalife, and about 1/2.5 of each of Nu Skin and Tupperware.

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

HERBALIFE

Herbalife’s second quarter 2017 net sales of $1.1 billion meant a decline of 5% compared to the second quarter 2016.

In this last quarter, among the six regions of Herbalife, only EMEA could report a sales increase (+3%). The others’ performances were: China 0%, Asia-Pacific 0%, Mexico -3%, South and Central America -8%, and North America -18%. As far as the individual markets are concerned, Herbalife management expressed their disappointments especially with the U.S., Mexico and China. The decline in the U.S., Herbalife said, was  a result of short-term trends from behavior, pattern adjustments due to the FTC implementation, and was believed to be transitionary in nature.

Referring to the changes imposed to the company by the FTC, CEO Rich Goudis stated, “With the successful implementation of tracking consumer retail transactions in the U.S., we are now entering into a new chapter for the company. Through technology innovations, and changes in our marketing plan here in the U.S., we are now collecting millions of customer receipts each month… With much of the transition behind us, we can now pivot back to an acute focus on growth.”

Herbalife said, over the past three months, it had captured approximately 9 million receipts in the U.S. It announced a new partnership with Salesforce, the world’s leading customer relationship management platform. Salesforce is expected to help Herbalife distributors leverage the information collected to create a more effective working environment.

The company also announced the promotion of Dave Pezzullo to Chief Operating Officer role. Dave has been serving most recently, as Executive Vice President of Worldwide Operations. Together with this came announcement of the creation of a new position reporting to the COO, the “Chief Innovation and Needs Officer”, that will be filled by Senior Vice President Chris Morris.

Herbalife expects to close the year with a sales growth of between -3% and +2%.

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

NATURA

Natura reported its quarterly sales was on par with last year second quarter’s (BRL 2b, approx. USD 648m). This result pulled down company’s first quarter sales growth of 2.3% to 1% at the end of first half-2017.

Natura’s global second quarter performance was basically impacted by the poorer performance in Brazil, its largest market. Natura’s second quarter sales in Brazil was down 2.3% whereas its international operations’ was up 4.9%. At the end of the last quarter, Brazil accounted for 67% of the global sales. Three years ago this time in 2014, this figure was 82%.

At the end of Q2, Natura had 1.8 million consultants on the field of which 1.2 million were in Brazil, and 0.6 million in other markets.

Natura reported it had been working to transform the business model in Brazil, and had started implementation of what is called “Relationship Sales.” This new model includes: 1) Introduction of Business Leaders to replace Natura Consultant Advisors with more entrepreneurial focus, 2) New income opportunities, and 3) Communication and promotion campaigns.

Along with the field network, Natura has also been using e-commerce and the retail channel. Management said “Rede Natura”, company’s online sales platform, posted strong triple-digit growth at the end of the second quarter. This channel has reached a consumer base of 1.9 million in Brazil. The retail channel on the other hand, ended the quarter with 15 exclusive Natura-owned stores in shopping malls in Sao Paulo (10) and Rio de Janeiro (5).

In June this year, Natura first made an offer and then, signed an agreement to acquire The Body Shop for EUR 1 billion from L’Oreal. This acquisition is subject to approval by the authorities and that is expected to happen in the coming months.

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

NU SKIN

Nu Skin’s second quarter sales was down more than 8%. Adding this performance to the one in the first quarter (+5.7%), Nu Skin closed the first half of the year with -2% revenue growth.

From a regional perspective, Americas reported 13.6% and EMEA 1.3% sales increase during the quarter. The rest of the regions posted negative figures: Mainland China -6.6%, South Korea -6.6%, Japan -11.1%, Hong Kong/Taiwan -17.8%, and South Asia/Pacific -26.4%.

Nu Skin’s business has been predominantly generated in the Asia and Pacific countries. As of mid-year 2017, the total volume in these countries makes up 80% of the global volume. Americas account for 13% and EMEA for 7%.

Since this Q2 performance was at the high end of its outlook of $530 to $550 million, management was satisfied with the results. CEO Ritch Wood said, “We believe our second-quarter results provide momentum we can build on as we prepare to introduce several new products and significant business initiatives in the fourth quarter.”

Nu Skin management reiterated its annual revenue guidance of $2.26 to $2.30 billion for 2017.

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

TUPPERWARE

Although at a slower pace than it achieved in the first quarter (5.5%), Tupperware managed to increase its global sales in the second quarter, too (1.4%).

Tupperware’s shining markets in terms of quarterly sales growth were: South Africa (+60%), China (+37%), Brazil (+32%), and Argentina (+21%). On a regional basis, South America was the most successful. Sales growth in South America in the second was +31% and its performance in the first two quarters combined was +36%.

Those markets that came up with the poorest results were: Indonesia (-38%) and France (-20%).  Having been Tupperware’s biggest market, the second quarter in Indonesia definitely is not something the management would have hoped for. However, management was also very disappointed with the performance in France, saying, “After nearly a decade of solid top and bottom-line growth, France has literally stalled out the last two years… the sales force size and demonstration capabilities have really slipped, and we began to rely a little bit too much on promotions, and this has impacted both sales and margins… In the last few months, we’ve made some important management changes in France.”

For several years, Tupperware Group management has been trying to find a way to reverse the negative trend at its cosmetics branch, Beauticontrol. Having come up with another 28% sales decrease in the last quarter, Tupperware reported it had decided to wind down this business. This decision is expected to bring a cost of $100-110 million to Tupperware. During the investors’ call, CEO Rick Goings clearly mentioned they had no intentions to close down company’s other cosmetics businesses namely, Fuller Mexico, Avroy Shlain and Nutrimetics.

Following the second quarter, Rick Goings said, “Strategically, we continue to move forward with our business transformation plans in key markets and other than for the Beauticontrol wind down, have not changed our expectations with regard to local currency sales growth in the second half of 2017.”

For the third quarter of 2017, Tupperware expects a 2-4% sales increase. Company’s year-end expectation is 3-4% growth. If this happens, Tupperware will be reporting a positive growth figure for the first time since 2013.

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

USANA

USANA reported last quarter, a slight decrease in sales on a year-over-year basis ($257m vs $259m). Following this, USANA’s mid-year net sales growth is still ahead of last year’s.

From a regional perspective, sales increased 23.9% in North Asia, increased by 3.7% in Greater China, decreased by 4.8% in the Southeast Asia Pacific, and decreased by 10.2% in the Americas and Europe region.

USANA said the U.S. had been continuing to be a challenging market for the company and they were working on a variety of initiatives to change the trend in he U.S. But this last quarter, USANA also saw customer declines in Mexico and Canada, two markets that the company said, had generated consistent customer growth for the company in the past.

“The Americas and Europe region continues to present a challenge for USANA, notwithstanding our team’s continued efforts to generate growth. Our strategies for this region in the short-term include market-specific promotions during the back half of the year, as well as other initiatives to generate momentum that will be announced in August at our 25th Anniversary International Convention,” CEO Kevin Guest commented. USANA’s Americas and Europe region currently accounts for 23% of company’s global volume.

In February 2017, USANA disclosed it was voluntarily conducting an internal investigation of its China operations, BabyCare. The investigation focused on compliance with the Foreign Corrupt Practices Act and on certain conducts and policies at BabyCare. USANA said it could not predict the duration or result of this investigation.

USANA management updated its 2017 net sales expectation after the second quarter, increasing it to between  $1.015-1.030 billion (previously $1.04-$1.07 billion).

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

With this analysis, we covered how six of the largest direct selling companies have been doing so far in 2017. We will be closely watching them in the second half, too.

…..

Hakki Ozmorali is the Principal of WDS Consultancy, a consulting firm specialized in providing services to direct selling firms. He is also the publisher of The World of Direct Selling, global industry’s leading weekly online publication. He is an experienced professional with a strong background in direct sales. Hakki was the first corporate professional in the Turkish network marketing industry. His work experiences in direct selling include Country and Regional Manager roles at various multinationals in Turkey and in Canada. You can contact Hakki here.

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The post Mid-Year Sales Performances of Six Public Direct Sellers appeared first on The World of Direct Selling.