Usana Health Sciences: A direct sell

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It’s hard to go wrong in a business where some of your best customers are also your best salespeople.

Just ask Usana Health Sciences Inc. (Nasdaq:USNA), a nutritional products maker based in Salt Lake City. Usana has built a global following through its direct-selling model, which contracts thousands of independent sales associates, most of whom began as Usana customers.

For those commissioned associates, direct selling is a thriving industry totaling $30.8 billion in the United States and about $112 billion worldwide last year, according to the Direct Selling Association. But the numbers don’t necessarily translate well for all consumer product companies, and those designated as direct sellers tend to come and go, the DSA says.

Usana arrived in 1992 and hasn’t gone anywhere but up. Annual revenue has more than doubled in the past five years, eclipsing $420 million in 2007. Usana credits a trusted product line and a proven marketing strategy for its continued success.

The company made three significant announcements at its annual convention on Aug. 28: a new energy drink product called Rev3; expansion into the Philippines; and new compensation incentives for associates.

Spurred by a challenge from CEO David Wentz, Usana scientists came up with an alternative to the sugary, “crash-and-burn” energy drinks common in today’s market. The resulting Rev3 is a green-tea based drink that contains an advanced formula of antioxidants as well as Usana’s patented olive-fruit extract, Olivol.   

“This is a product that will appeal to a wide audience,” Wentz said in . . .

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