Nu Skin Enterprises
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| Type | Public |
|---|---|
| Traded as | NYSE: NUS |
| Industry | Personal care, nutraceuticals |
| Founded | 1984 |
| Founder(s) | Blake Roney, Steve Lund, Sandie Tillotson |
| Headquarters | Provo, Utah, United States |
| Area served | Worldwide |
| Key people | Blake M. Roney (Chairman) M. Truman Hunt (President, CEO, and Director) Ritch N. Wood (Vice President and CFO)[1] |
| Revenue |  US$ 1.54 billion (2010)[2] |
| Operating income | US$ 217.062 million (2010)[2] |
| Net income | US$ 136.051 million (2010)[2] |
| Total assets | US$ 892.224 million (2010)[2] |
| Total equity | US$ 471.249 million (2010)[2] |
| Website | www.nuskin.com |
Coordinates: 40°14′00″N 111°39′37″W / 40.2334366°N 111.6601706°W
Nu Skin Enterprises (NYSE: NUS) is an American direct selling and multilevel marketing company which develops and sells personal care products and dietary supplements (under the Pharmanex brand).[3] Nu Skin was founded in 1984 in Provo, Utah.[4] The company originated in the U.S. and began its first international operation in Canada in 1990. One year later, the company began operations in Asia with the opening of Hong Kong.[5] In 1996 the company listed on the New York Stock Exchange.
In 1992, Nu Skin reached settlements with 5 states which had accused the company of operating a pyramid scheme.[6] Following a 1994 investigation by the Federal Trade Commission (FTC), the company paid $1 million and signed a consent decree prohibiting it from making deceptive or unsubstantiated claims about its products.[7] In 1997, the company paid an additional $1.5 million to the FTC to settle ongoing allegations of unsubstantiated promotional claims.[8]
In 2010, the company reported its highest ever earnings with US$1.54 billion in revenue in 51 international markets.[2] As of 2011, Nu Skin operates in 52 countries in North America, Europe, and Asia.[9] The company sells a range of products, from skin and hair products to a flagship line of dietary supplements marketed as anti-aging.
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[edit] Brands and products
Under the Nu Skin and Pharmanex brands, the company develops and sells more than 200 personal care products marketed as helping people look and feel younger.[10] Pharmanex, a dietary-supplement company, was acquired by Nu Skin in 1996.[11] A portion of proceeds from some product lines is donated internally to the Nu Skin Force for Good Foundation.[12]
In the late 1990s, Nu Skin invested in Big Planet, a multi-level marketing company selling Internet services. The New York Times noted that Big Planet appeared to recruit people "even if they have little knowledge of the technology that they are supposed to be selling." A representative of the company stated: "I believe people who have never touched a computer before can become hugely wealthy in this business."[13]
[edit] Business model and sponsorships
Nu Skin Enterprises’ business model combines direct selling with multi-level marketing. Each distributor markets products directly to potential customers, and can also recruit and train customers to become distributors. Distributors are paid from the retail markup on products they are able to sell personally, as well as a performance bonus based on the sales of distributors they have recruited.[14] As of 1994, most distributors made several hundred dollars per year or less, with only about 30% exceeding that income level.[13]
Since the beginning of the 1992–93 professional basketball season, Nu Skin has sponsored the Utah Jazz Dancers.[15] Nu Skin also sponsors the Brigham Young University athletic program and the America's Freedom Festival at Provo, one of the nation's largest Independence Day celebrations.[16][17][18]
[edit] Scrutiny and reception
In the 1990s, the Federal Trade Commission (FTC) investigated Nu Skin over complaints of deceptive advertising and overstating the income earned by distributors.[13] In 1994, the company paid $1 million and signed a consent decree prohibiting it from making deceptive or unsubstantiated claims about its products.[7] In 1997, Nu Skin paid an additional $1.5 million to the FTC to settle ongoing allegations of unsubstantiated promotional claims.[8]
In the early 1990s, Nu Skin was investigated by the states of Connecticut, Pennsylvania, Florida, Illinois, Ohio, and Michigan over allegations of misleading marketing practices.[6] Ultimately, in 1992 the company settled with 5 of these states, admitting no wrongdoing but agreeing to pay the states' investigative costs, refund disgruntled distributors, and revamp its promotional practices.[19][20][21][22] However, the Connecticut Attorney General did not agree to those terms and sued Nu Skin, charging the company with misleading its distributors and operating a pyramid scheme.[6][23][24]
In 1997, the Attorney General of Pennsylvania sued Nu Skin, alleging that the company operated a pyramid scheme through a subsidiary, QIQ Connections. The Attorney General's office alleged that distributors paid for the right to market technology services which did not, in fact, exist. Nu Skin discontinued the QIQ subsidiary, allowing those who had paid QIQ to transition to Big Planet, another Nu Skin interest marketing Internet technology. The president of Big Planet described the pyramid-scheme allegations as a matter of "a few distributors who in their enthusiasm have been overzealous in some of their marketing activities."[13]
As of February 2012, Nu Skin has an A+ rating with the Better Business Bureau.[25] The company is also a member of the Direct Selling Association and the Direct Selling Education Foundation.[26]
[edit] Evaluation of supplements
The Pharmanex LifePak Anti-Aging supplement was tested by ConsumerLab.com, and was reported as failing the overall review due to failing to clearly indicate its total Vitamin A content per FDA requirements.[27]
[edit] Political activities
In 2011, two Utah-incorporated business entities linked to top executives of Nu Skin each made a $1 million contribution to Restore Our Future, a "Super PAC" established by former aides to US presidential candidate Mitt Romney to support his bid for the White House.[28]
[edit] References
- ^ "Nu Skin Executives". Hoover's, Inc.. http://www.hoovers.com/free/co/people.xhtml?ID=52386. Retrieved 2008-12-26.
- ^ a b c d e f Nu Skin 2010 Annual Report Selected Financial Data - page 34
- ^ "Nu Skin Enterprises Company Description". BusinessWeek. http://investing.businessweek.com/research/stocks/snapshot/snapshot_article.asp?ticker=NUS:US. Retrieved February 21, 2012.
- ^ "2011 UV50 TOP 10 Revenue Companies". Utah Valley BusinessQ. March 10, 2011. http://utahvalleybusinessq.com/uv50/2011-uv50-top-10-revenue-companies.
- ^ http://www.referenceforbusiness.com/history2/21/Nu-Skin-Enterprises-Inc.html
- ^ a b c Romboy, Dennis (January 3, 1992). "Nu Skin still has wrinkles to iron out in Connecticut". Deseret News. http://news.google.com/newspapers?id=wSwhAAAAIBAJ&sjid=xHoFAAAAIBAJ&pg=5043,882660. Retrieved February 21, 2012.
- ^ a b "Consent Order C-3489". Federal Trade Commission. 1994-04-01. http://www.ftc.gov/os/decisions/docs/vol117/FTC_VOLUME_DECISION_117_(JANUARY_-_JUNE_1994)PAGES_316_-_418.pdf. Retrieved 2010-12-25.
- ^ a b "Nu Skin to Pay $1.5 Million Penalty to Resolve FTC Charges Over Fat-Loss Claims for Supplements". Federal Trade Commission. 1997-08-06. http://www.ftc.gov/opa/1997/08/nuskin3.htm. Retrieved 2008-12-26.
- ^ "Nu Skin Global Presence" (Press release). Nu Skin Enterprises. http://www.nuskin.com/content/corpcom/en_US/company/corporate_press_kit/global_presence.html.
- ^ "Company History" (Press release). Nu Skin Enterprises. http://www.nuskin.com/content/nuskin/en_US/culture/company_history/the_history.html.
- ^ http://sis.windhover.com/buy/abstract.php?id=199810153
- ^ Pugmire, Genelle (June 5–6, 1996). "Nu Skin introduces ethnobotanical products". Deseret News. http://news.google.com/newspapers?id=h-5LAAAAIBAJ&sjid=wewDAAAAIBAJ&pg=3878,2716675.
- ^ a b c d Davis, Ruth (May 28, 1998). "Selling Sites Like Soapflakes". New York Times. http://theater.nytimes.com/library/tech/98/05/circuits/articles/28bigg.html. Retrieved February 21, 2012.
- ^ Xardel, Dominique (1993). The Direct Selling Revolution. Understanding the Growth of the Amway Corporation. Blackwell Publishing. pp. 1–4. ISBN 978-0631192299.
- ^ "Utah Jazz Cheerleaders". best-basketball-tips.com. http://www.best-basketball-tips.com/utah-jazz-cheerleaders.html.
- ^ Walch, Tad (August 29, 2008). "New scoreboard means no more stiff necks at BYU". Deseret News. http://www.deseretnews.com/article/700254644/BYU-football-New-scoreboard-means-no-more-stiff-necks-at-BYU.html. Retrieved February 21, 2012.
- ^ http://www.freedomfestival.org/get-involved/sponsors
- ^ America's Freedom Festival At Provo. David A. McDougal Publishing. 1989. p. 16.
- ^ "Nu Skin settles complaints with 5 states". Pittsburgh Press (Associated Press). January 3, 1992. http://news.google.com/newspapers?id=xHUcAAAAIBAJ&sjid=dGQEAAAAIBAJ&pg=6970,525726. Retrieved February 21, 2012.
- ^ Yeomans, Adam (January 3, 1992). "Nu Skin settles suit with state". Ocala Star-Banner. http://news.google.com/newspapers?id=G10xAAAAIBAJ&sjid=TgcEAAAAIBAJ&pg=5965,792626. Retrieved February 21, 2012.
- ^ Elmore, Charles (January 3, 1992). "Coming clean: State drops pyramid probe as Nu Skin agrees to refunds". Palm Beach Post.
- ^ "Nu Skin will pay 5 states in pyramid-scheme case". Philadelphia Inquirer. January 4, 1992.
- ^ "Connecticut sues Nu Skin". Boston Globe. January 3, 1992. http://pqasb.pqarchiver.com/boston/access/58982181.html?FMT=ABS&FMTS=ABS:FT&type=current&date=Jan+03%2C+1992&author=&pub=Boston+Globe+%28pre-1997+Fulltext%29&desc=Connecticut+sues+Nu+Skin. Retrieved February 21, 2012.
- ^ Waggoner, John (January 3, 1992). "Nu Skin signs up for a makeover". USA Today. http://pqasb.pqarchiver.com/USAToday/access/55646186.html?dids=55646186:55646186&FMT=ABS&FMTS=ABS:FT&type=current&date=Jan+03%2C+1992&author=John+Waggoner&pub=USA+TODAY+%28pre-1997+Fulltext%29&desc=Nu+Skin+signs+up+for+a+makeover. Retrieved February 21, 2012.
- ^ "Nu Skin Enterprises Business Review". Better Business Bureau. http://www.bbb.org/utah/business-reviews/multi-level-selling-companies/nu-skin-enterprises-in-provo-ut-84110111. Retrieved February 21, 2012.
- ^ http://www.dsa.org/forms/CompanyFormPublicMembers/search?action=find]
- ^ "ConsumerLab Multivitamin and Multimineral Supplements Review - Main Review". 15 June 2011. https://www.consumerlab.com/reviews/Multivitamin_Multimineral_Supplements/multivitamins/. Retrieved 18 August 2011.(subscription required)
- ^ Martin, Jonathan; Kenneth P. Vogel (July 31, 2011). "PAC brings in $12.2 million for Mitt". Politico. http://www.politico.com/news/stories/0711/60329.html. Retrieved August 4, 2011.
