Information on Herbalife

Herbalife is an international producer and distributor of nutrition, weight-loss, and skin care products. Herbalife is one of the largest nutrition and health companies in the world because of their use of independent distributors. Herbalife focused their massive growth strategy on the use of independent distributors, rather than retail locations, which are paid solely by commissions on their multi-level marketing efforts and the products they sell.

Size

• Herbalife currently employs over 1.9 million independent distributors that sell their products in six different continents, including over 70 countries total. Herbalife and their independent distributors sell more than 100 different products.

Significance

• According to Herbalife's mission statement, the purpose of the company is "to change people's lives by providing the best business opportunity in direct selling and the best nutrition and weight management products in the world." Herbalife strives to produce the highest quality of nutritional products that combine nature's resources and scientific research. Becoming an independent distributor allows individuals the business opportunity of becoming their own boss while helping improve other people's lives.

History

• Mark Hughes founded Herbalife in February 1980. With only a few nutrition products and a weight management program, the original product line topped $2 million sold in the first two years; with this initial success, Mark Hughes decided to expand into Canada in 1982. The decision to become a multinational company led to more expansion efforts into Australia and the United Kingdom by 1988. In 1992, Herbalife launched a large new product line, which included skin care products and new and improved nutritional products. According to Herbalife's official Website, after this new product launch, "monthly sales soared from $13.1 million to an impressive $21 million." In 1994, Mark Hughes announced the formation of a non-profit initiative to help at risk children, called the Herbalife Family Foundation. In 2003, in memory of Mark Hughes, who died in 2000, Herbalife opened the Mark Hughes Cellular and Molecular Nutrition Laboratory in southern California. In 2004, the decision to go public resulted in a successful initial public offering; within two more years, Herbalife expanded to serve over 60 countries.

Employment

• The independent distributors receive discounts on any products for personal use and can enjoy commissions through two ways: directly selling products to customers or by recruiting another independent distributor. The use of multi-level marketing gives independent distributors the opportunity to turn their customers and/or other acquaintances into distributors as well and receive commissions off every sell they make. This employment opportunity provides complete flexibility with some distributors just looking to earn additional spending money while many distributors make it a successful career.

Financials

• Herbalife reached the $1 billion sold mark in 1996. According to Herbalife's official Website, in 2002, "Herbalife was taken private by venture capitalist firms J.H. Whitney & Co., L.L.C. and Golden Gate Capital Inc." for close to $685 million. When the company was taken public in 2004, the IPO sold 14,500,000 shares at $14 per share.