Following a promising last quarter in the global direct sales industry, the first quarter results did not seem satisfactory. That said, there are direct selling companies like Nature’s Sunshine, Primerica, Betterware, and as you will read in our review, Herbalife that came up with positive growth rates compared to the same time in 2023.
Our review covers the first quarter performances of Herbalife, Medifast, Natura &Co, Nu Skin, Oriflame, and USANA.
Herbalife reported 1% revenue increase in the first quarter compared to last year’s first quarter.
Among Herbalife’s regions, China reported the highest growth (11%). Sales in Asia-Pacific, Latin America, and EMEA regions grew by 4%. North America was the only one with declining sales (-11%), driven by the decrease in the U.S. To reverse this, management said several initiatives have been launched during Q1 that are beginning to take root.
Commenting on the results, Michael Johnson, Chairman and CEO, said, “We achieved our second consecutive quarter of year-over-year net sales growth.”
Herbalife recently rolled out its all-new distributor e-commerce platform to its distributors in the UK and Spain. The new distributor sites place an emphasis on strengthening the customer-distributor connection, providing faster order fulfillment and checkout for customers. In 2024, development will continue offerings to elevate the digital platform capabilities provided to its distributors and customers, the company said. In addition to Herbalife China team is rolling out wearables in a virtual buddy that leverages artificial intelligence.
Management forecasts 0% to +3% year-over-year growth in the second quarter, and 0% to +5% growth in 2024.
For more on Herbalife’s 2024 first quarter performance, please click here.
Medifast announced its revenues in the first quarter of 2024 as $174.7 million. This meant a 50% decrease compared to last year’s first quarter ($349.0 million). Yet it was expected and was at the upper end of the company’s guidance range of $155 million to $175 million.
Management said this was primarily driven by a decrease in the number of active earning OPTAVIA Coaches, lower Coach productivity. Medifast’s total number of active Coaches decreased 36% to 37,800. The average revenue per active Coach was $4,623 ($5,945 in Q1 2023), due to continued pressure on customer acquisition. Medifast plans to spend $30 million in 2024 to drive customer acquisition.
Chairman and CEO Dan Chard said, “Fast paced medical innovation is providing greater access to medical weight loss solutions than ever before. We are transforming our OPTAVIA offer to include comprehensive support for consumers who wish to use GLP-1 medical weight loss solutions. It’s a market that is estimated by a recent BCG market study to have the potential to grow to $50B or more by 2030, and it’s one that we are uniquely positioned to capitalize on.”
The company expects its second quarter 2024 revenue to be between $150 million to $170 million.
For more on Medifast’s 2024 first quarter performance, please click here.
Natura &Co’s consolidated net revenue reached BRL 6.1 billion (approx. US$ 1.2 billion) in Q1 2024, down 5.7% year-on-year.
Natura &Co Latam segment reported BRL 4,7 billion sales (down 3%), and Avon International BRL 1.4 billion (down 13%). Natura &Co Latam includes Natura and Avon businesses in Latin America.
The company stressed the strong momentum Natura Brazil showed (11% YoY increase in constant currency). This performance includes retail sales which showed robust growth in the country. Natura opened 132 stores in the last twelve, reaching a total network of 896 stores. This strong result in Natura Brazil was offset by Avon Latam, with revenues down 11% in Brazil and 12% in Hispanic Latam.
44% of Natura &Co’s global revenues are generated in Brazil, 27% in Hispanic Latam, 18% in EMEA, 6% in North America, and 5% in Asia.
Avon International had a slow start in 2024. Avon is actively exploring opportunities in other distribution channels, including retailers. Avon is already being sold in the UK via Superdrug, in Italy via Naima stores and in Turkey via representatives’ retail franchise stores.
Group CEO of Natura &Co Fabio Barbosa said, “Avon International had another challenging quarter, impacted by a steep Fashion and Home decline and a softer impact of CFT categories. The management team is working on simplifying the market, focusing on key countries, and enhancing our portfolio with superior promotional execution. We believe these steps are crucial to stabilize revenues and keep us on track to improve profitability.”
As it was announced earlier, the group management is reviewing the feasibility of a possible separation of Avon and Natura.
For more on Natura &Co’s 2024 first quarter performance, please click here.
Nu Skin’s total revenues in the first quarter were $417.3 million, indicating a decrease of 13% from Q1 of 2023, yet in line with company’s previously announced guidance.
Nu Skin’s all regions contributed to this decrease: Mainland China 10%, Europa & Africa -11%, Southeast Asia/Pacific -11%, Hong Kong/Taiwan -12%, Japan -16%, Americas -26%, and South Korea -42%.
“Our first quarter revenue came in at the mid-point of our guidance,” said Ryan Napierski, Nu Skin president and CEO. “We are continuing our business transformation efforts and making progress in developing our integrated beauty, wellness, and lifestyle ecosystem. During the quarter, we again drove strong gains in our Rhyz business, growing nearly 60% year-over-year.”
Company’s new product introductions delivered solid results, management said. The holistic wellness and beauty devices launched recently, along with the personalized weight management system, contributed approximately $42 million (about 10%) to Q1 revenue.
In the second quarter of 2024, the company projects its revenues to be in the range of $420-$455 million ($500 million in 2023 Q2). For the whole year, projection is $1.73 to $1.87 billion ($1.97 billion in 2023).
For the future, Nu Skin sees India and its emerging market business model as a gateway to many new markets and expect these will help them delve deeper in other markets in Latin America, Southeast Asia, and China.
This year Nu Skin celebrates its 40th anniversary.
For more on Nu Skin’s 2024 first quarter performance, please click here.
Oriflame reported 25% revenue decline in the first quarter. Company’s Q1 2024 sales were EUR 157 million (EUR 208M in 2023). Average number of members decreased to 1.6 million (2.0 million) and unit sales decreased by 27%
Sales results during the first quarter remained challenging in all regions with results still negatively impacted by macroeconomic and geopolitical impacts including the ongoing Russia/Ukraine War, management commented. They also pointed out the adverse exchange rate movements in several key markets had further impacted sales negatively.
Oriflame’s four regions reported quarterly sales declines similar to each other: Latin America -25%, Asia -24%, Europe & CIS -27%, and Turkey & Africa -28%. Europe & CIS is company’s largest region with more than 50% share in total sales.
For more on Oriflame’s 2024 first quarter performance, please click here.
First quarter net sales at USANA were $228 million versus $248 million during Q1 2023, showing an 8% decrease.
In the first quarter, USANA’s China region reported 3% growth. Sales were down 12% in Americas & Europe region, down 22% in Southeast Asia Pacific, and down 28% in North Asia. China is company’s largest region among these and generates more than half of the global revenues. In the first quarter, China national sales meeting in Xiamen had approximately 17,000 attendees, the company reported.
President and CEO Jim Brown said, “Our top line results during the first quarter were driven by a successful sales incentive in mainland China, which helped counter the seasonal slowdown during the Lunar New Year holiday. This sales incentive helped us generate 15% year-over-year active customer growth in our largest market, as well as year-over-year and sequential quarter sales growth. Notwithstanding our solid performance in China, our first quarter results in other key markets did not meet internal expectations and we are actively working to accelerate our business in these markets during 2024.”
USANA completed its first full quarter of operations in India, attracting several strong field leaders. The management said they were expecting India’s contribution to be small this year, but they have high expectations for a long-term growth in India.
For 2024, company forecasts its annual sales to be between $850 – $920 million. This was $921 million in 2023.
For more on USANA’s 2024 first quarter 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 the publisher of The World of Direct Selling, global industry’s leading weekly online publication since 2010. Hakki Ozmorali 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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