Herbalife Nutrition Performance, Growth Potential, and Selling Model

The investors’ preference for Herbalife stocks is on the rise as is evidenced by their surge of 68.7% by end of 2018 compared to the decline experienced by the market of 0.1%. The popular wellness and weight management company will continue gaining from its increasing volumes in the markets, the global presence and also because of its sturdy products portfolio. However, the company needs to be wary of the effects of currency fluctuations. HLF volume points advanced by 15 percent in the third quarter of 2018 which was the highest compared to the first and the second quarter. It was also the highest the company has ever achieved year-on-year since 2012. It expected to achieve considerable improvements even in the year 2019.

 

The growth was as a result of the management’s initiative at Herbalife Nutrition of introducing a direct-selling strategy in the company. They also introduced other efforts aiming at keeping pace with the preferences of the consumers. The company prides itself for having a robust products portfolio that is compromised of fitness products, weight management, energy, sports, and nutrition products. Herbalife is continuously working to keep expanding the portfolio to assist its distributors to attract new customers and retain the old ones. Currently, it has 58 products under its name that are available in 51 countries around the globe. As it is working towards introducing new products, it will also be introducing new flavors for the existing brands.

 

 

Herbalife success if partly influenced by the direct sales model it utilizes. The model uses independent distributors, sales representatives and contractors in selling their products, which is unlike the traditional method of electronic commerce and brick and mortar shops. One of the advantages that the company enjoys from this model is establishing personal relationships with clients. The distributors have close contact with the customers and in most cases, some of the clients are already established in the distributors’ social networks. The personal contact with customers helps in creating return customers for the company, who are essential to the growth as well as the development of the company. The distributors also attract more customers by using social media, advertising, and online forums.

The other benefit of a direct sales model is the flexibility of the products’ distributors. They have the flexibility to establish their business anywhere. They are not obliged by the company to work for a specific number of hours, instead, they are free to choose the time suitable to them. They may work full -time or even part-time depending on their goals. The flexibility is appealing to entrepreneurs such as full-time students or the young parents that are looking for a means to make income during their free hours. It also an option for someone seeking a full-time job without necessarily having to set a retail store

Website:  https://herbalife24.com/