The Operation and Management of
A Direct Selling Company
Nu Skin As An Example
National Sun Yat-sen University
Presented by Johnathan Kunz
Vice President, Nu Skin Taiwan
May 23, 2006
Lecturer Profile
Johnathan Kunz – Vice President of Sales,
Nu Skin Taiwan
 Joined Nu Skin Enterprises in 1997
 Account Manager
 MBA-Brigham Young University 2001
 Global Business Opportunity Development
 New Market Development
 Appointed as Vice President of Sales for Nu Skin
Taiwan in April 2004
President of Nu Skin Taiwan
John Chou
Nu Skin Taiwan, Inc., Taiwan Branch
President
World Federation Direct Selling
Association
Association Advisory Council
member for Asia Pacific Region
Taiwan R.O.C Direct Selling Association
Chairman (1997 – 2000, 2 terms, 2year term)
Taiwan R.O.C Direct Selling Association
Standing Director
2001 – 2006, (current, 2-year term)
Chinese Taipei Olympic Committee
Consultant
Presentation Structure
1. Nu Skin Enterprises Overview
2. Nu Skin Enterprises Milestone
3. Nu Skin Taiwan Milestone
4. Company Mission and Vision
5. Compensation Plan
6. Product/Marketing Strategy
7. Company Culture
8. PR
9. Communication
10. Distributor Support
11. Service Centers and Logistics 12. Code of Ethics
Nu Skin Enterprises Overview
Nu Skin
Enterprises
Founded
1984
IPO in 1996
New York Stock Exchange
Company Overview
• Operations in 41 markets
• Premium-quality products
• Tradition of innovation
• Top-10 U.S. direct-selling companies
Direct Sales Overview
Top U.S. Companies
Revenue
Products
Avon
$7,700M
Personal Care
Amway
$6,200M
Various
Mary Kay
$1,800M
Cosmetics
Herbalife
$1,300M
Weight Loss
Tupperware
$1,200M
Household Products
Nu Skin Enterprises
$1,100M
Skincare / Nutrition
Pampered Chef
$ 700M
Home Care
Source: Company reports
Financial Results
Annual Revenue Since 2001
In Millions of Dollars
$1,200
$1,181
$1,138
$1,100
$1,000
$964
$900
$986
$886
$800
2001
2002
2003
2004
2005
Revenue by Geography
2005 Results
Greater
China/SE Asia
20%
North Asia
56%
North America
13%
Other Markets
4%
South
Asia/Pacific
7%
Nu Skin Enterprises Milestone
Nu Skin Taiwan Milestone
Founded in 1992
Reached top 10 in the first year
1996 – (Business Weekly) survey: Top brand
1997 – 500 Top Companies service industry :Ranked #96
1998 – Founder visited President Lee
1999 – Endorsed by COC
2002 – 10th Anniversary. Founder visited President Chen
2003 – (China Times) survey: #1 in Brand Awareness, Product Satisfaction, Corporate Image,
Distributor Character
2004- Outstanding Performance: Revenue Growth +11%, EGB Bonus Growth +10%,
Executive Growth +102%
2005 – Gold Medalists Endorsement Chen Shih Shin
Company Mission and Vision
Mission Statement
Our Mission is to be a force
for good throughout the world by
empowering people to improve
lives with rewarding business
opportunities, innovative
products, and an enriching and
uplifting culture.
Vision Statement
Our Vision is to become the world’s
leading direct selling company by
generating more income for
distributors than any other company.
Direct Sales Overview
Selected Top Direct Selling Companies
Avon
Amway
$7,700M
$6,200M
Annual Revenue
11%
$ 847M
33%
Total Payout
Commission Rate
$2,046M
Mary Kay
$1,800M
15%
$ 270M
Herbalife
$1,300M
33%
$ 429M
Tupperware
$1,200M
10%
$ 120M
Nu Skin Enterprises
$1,180M
43%
$ 507M
Pampered Chef
$ 700M
10%
$
70M
Source: press releases, company estimates
Compensation Plan
Innovative Compensation Plan
Global Seamless
6 Generation 5%
Entrepreneur Driven and Most Rewarding
Opportunities
We Create Millionaires
Global
20 Millionaire - 20 accounts
10 Millionaire – 20 accounts
5 Millionaire – 71 accounts
1 Millionaire – 463 accounts
Taiwan
10 Millionaire – 1 account
5 Millionaire – 6 accounts
1 Millionaire – 52 accounts
Leaders Recognition
Product/Marketing Strategy
Nu Skin Products All of The Goods, None of The Bad.
Pharmanex Products Provided by Natural, Proven by Science
R&D Team – Top Scientists
Over 130 Scientists
Dr. Carl Djerassi
Worldwide labs
In Search of Excellence
- Company Awards -
The Measurable Difference
Biophotonic Scanner
Science technology breakthrough
ProDerm
Best Products Certified
5 Health Food Licenses
BioTech Awards
Innovation Award
Green Mark
Product Endorsement
COC
Gold Medallists
Pharmacological Standard Product Quality / 6S
1. Selection
2. Sourcing
3. Structure
4. Standardization
5. Safety
6. Substantiation
Brand Awareness
China Times Survey in 2003
Brand Awareness
Product Quality Satisfaction
Corporate Image
Distributor’s Character
Company Culture
Culture
“Our mission is to be a force
for good in the world ….”
Nourish the Children
“Nourish the
Children may be 5
percent of what we
do, but it is 95
percent of who we
are.”
–Blake Roney
Nourish the Children
VitaMeal Production Facility
in Lumbadzi, Malawi
New VitaMeal Facility Under
Construction in Jixi, China
Produces enough food to feed 30,000 children
a day and provides jobs for 700 Malawians
Will have capacity to produce more
than one million meals per month.
NTC Global Sales Report:
Donated over 40 million meals through Nourish the Children .
Force For Good
Force For Good Foundation
I want to be the do good company in the world.
- Blake M. Roney
Force For Good Foundation
 25 cents for each Epoch product sold
 EB research and care
 Seacology Foundation
 Secure rain forest
 Dr. Paul Cox
 $13 million donated Since 1996
 Foundation donates more than $1 million actually
to projects around the world
Force For Good In Taiwan
NTC – Vita Meal Donation To Hua Lien (花蓮)
Stanford University
史丹佛大學醫學院
School of Medicine
EPIDERMOLYSIS BULLOSA
RESEARCH PROGRAM
先天性表皮鬆解症(EB)研究計劃
How EB Got Its Name
EB名稱的由來
•Epidermolysis is breaking apart of skin
“Epidermolysis”是皮膚破裂的意思
•Bullosa means blister
“Bullosa”是水泡的意思
•Epidermolysis Bullosa = EB
EB=先天性表皮鬆解症
Force For Good In Taiwan
EB Family Gathering
Force For Good In Taiwan
EB Trip – Lu Gang 鹿港
Force For Good In Taiwan
EB Trip – Hong Kong
Force For Good In Taiwan
Donate 500 bottles of ReiShi Max To
Taipei Government for fighting SARS
PR
TV Program Interview
Media Exposure/Report
To build up corporate image and recruit people who want to start their own business to become
Nu Skin distributors, there has been a lot of propaganda in newspaper and magazine.
Media Exposure/Report
 Athlete Health Forum
 Press Conference
Communication
Magazine
BD Update
Nu Skin Update
Web Site
SMS
GWP
E-mail Broadcast
E-mail Subscription
Distributor Support
RC/Taiwan Convention
Success Seminar
Group Success Seminar
Distributor Training
Scan Taiwan
TE Trip
Incentive Trip
BD Meeting
Fashion Workshop / Health Seminar
Front Line Major Functions
Account Manager
 Business support
 Communication bridge between the company & business builder
 Sales promotes
Service Agent
 Walk in center service
 Phone in order service
 Product returns
 Warehouse
ACD
 Customers service information center
 Follow up customers inquiries & special requests
Branches/Service Centers
Walk-In Centers and Display
Showcase - Gym/SPA
如新泉源會館
Nu Skin Fountain Club
Ordering Type
 Walk in
 Phone in
 Fax
 Web ordering
 ARO
 COD
Code of Ethics
Education/Training
Policy and Procedure
Equal Playing Field