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Melaleuca, The Wellness Company is a $887 million nutritional, cosmetic, and personal care products company founded in 1985 and headquartered in Idaho Falls, Idaho, USA.
Melaleuca was listed on the Inc. 500's list of fastest-growing companies in 1990, 1991, 1992, 1993, and 1994 and today is one of the largest and most successful privately owned companies in Idaho.
History
Melaleuca, Inc. is not the first Melaleuca based company. A previous company began under the name "Oil of Melaleuca, Inc." offering a single product called "T36-C5 Melaleuca Oil" which was formulated from extract of the melaleuca alternafolia shrub-like tree, commonly known as tea tree oil. This other company operated as a standard multi-level marketing company whose literature reportedly made health claims the FDA would not approve because the company sold products whose uses and benefits were not verifiably documented. There were also exaggerated claims of the efficacy, and claims that the company was a sole source of the tea tree oil sold by the company.
In 1985, Oil of Melaleuca, inc. was taken over by Frank L. VanderSloot who quickly dissolved the company, created a new marketing plan to support consumers, immediately launched an initiative to bring the company's product line into compliance with FDA regulations, and started a new, legally sound company under the name of "Melaleuca, Inc.". He moved away from the Multi Level Marketing model, and developed a new compensation plan for Marketing Executives now know as Consumer Direct Marketing where there would be no risky up-front investment, no hype, and a focus on every day consumable products. Independent Marketing Executives were no longer required to sell products but instead became preferred membership enrollment facilitators. Since VanderSloot has taken the helm, Melaleuca has experienced consistently increasing sales and revenues and expanded internationally.
Since its beginning in 1985, Melaleuca has grown to over 2,500 employees as well as sales offices in Hong Kong, Japan, and Australia, Taiwan, New Zealand, and United Kingdom and grossed US $887,000,000 in sales in 2008. Melaleuca began sales in Singapore, Netherlands, and Jamaica in 2006.
Sales History
Melaleuca was recognized by Inc Magazine as one of the fastest growing companies in the United States for five consecutive years (1990–1994). In addition, Melaleuca has seen 23 years of consecutive growth since its foundation in 1985.
Though sales reached $887 million in 2009, Melaleuca holds less than 0.5% of the North American marketplace, with their largest competitors being Procter & Gamble and Johnson & Johnson.
Products and business model
While initially based predominantly on melaleuca plant extracts, the product line has since expanded beyond this initial focus. Melaleuca sells products including environmentally friendly household cleaners, personal care items, pharmaceuticals and nutritional supplements. The company markets itself as being earth-friendly, and many of their products are certified organic and Kosher certified. They also launched a cosmetics line in partnership with fashion designer Nicole Miller in August, 1999. They launched a home security line of services and products in 2009.
Melaleuca has been outspoken against the abuses inherent to multi-level marketing and the damage they can cause. By contrast, Melaleuca does not allow inventory loading (a practice used by many multi-level marketing companies encouraging them to purchase sometimes thousands of dollars worth of inventory), limits the marketing chain to 7 generations, and prohibits "breakaways" (another practice commonly found in multi-level marketing). Melaleuca also does not require its marketing executives to maintain an inventory. In order to earn commissions from one's customers, marketing executives must produce a minimal number of 35 product points per month (the equivalent of about $45–55 each month) to remain an active Independent Marketing Executive. This in turn qualifies the Preferred customer to receive a 30%-40% discount off the regular purchase price of their personal product purchases. The company also offers their preferred members an opportunity to earn up to 10% of their monthly product order back in "Loyalty Shopping" dollars. After earning $100 in Loyalty Shopping dollars their first five consecutive months, new preferred members are allowed to redeem their earned Loyalty Shopping dollars towards products.
The products Melaleuca produces today are typically everyday, consumer items such as shampoo, hairspray, and cleaning supplies. Independent Marketing Executives and Preferred Customers of Melaleuca, Inc. say that the minimum required level to receive this discount is compatible with average household and personal monthly use.
According to Melaleuca, the company focuses on developing products that support wellness through a healthy lifestyle and products that are safer for your home. The Company focuses on researching and bringing to market cleaning products that are environmentally friendly and use more natural ingredients. Melaleuca touts that its products perform as good or better than what is found at the local grocery store, but without the bleach, lye, or other chemicals typically found in other brands.
The company has developed an extensive line of nutritional products such as vitamin and mineral supplements which claim to promote heart health, cardiovascular, and blood pressure supplements, and a glucosamine product for healthy joints. They also have developed products using natural ingredients that the company claims support healthy vision, healthy prostate, healthy urinary tract, as well as other nutritional supplements. It also has a body and bath product line, beauty and makeup line, and weight management line.
Melaleuca uses a direct-to-consumer delivery model, where a customer can place an order via telephone, fax or online (over the internet) and products are delivered to their door via UPS or national mail carrier.
Nutritional Supplement Regulation
Dietary Supplements are considered a food and are less regulated by the federal Food and Drug Administration. Some doctors and pharmacies point out that some natural supplements may have an effect on prescription medications. Additional information on herbal supplements and their uses and regulations can be found at the Wikipedia's herbal supplements page.
Awards and Public Recognition
Melaleuca and its 22 year President and CEO, Frank VanderSloot, have been the recipients of numerous distinguished honors and awards:
- Five Time Inc. 500 List of Fastest Growing Businesses - Melaleuca is one of only a few business in history who have been listed in the Inc. 500 five consecutive times.
- Inc 500 Hall of Fame - In 2005 Melaleuca was inducted into the Inc. 500 Hall of Fame.
- Blue Chip Enterprise Award - In 1991, the United States Chamber of Commerce honored Melaleuca by presenting it the Blue Chip Enterprise Award.
- Healthy Workplace Award - Melaleuca was one of 15 organizations in 2004 recognized nationally by the American Psychological Association with a "Best Practices Honor" for efforts to foster Family Support in the workplace.
- IACI Environmental Excellence Award - in 2003 Melaleuca was awarded the Idaho Association of Commerce and Industry Environmental Excellence Award. Criteria for the award includes environmental practices, investment in pollution control, recovery from waste streams, conservation, and other environmental achievements.
- Entrepreneur of the Year Awarded - Ernst & Young and CNN awarded Melaleuca's President and CEO Frank VanderSloot the Entrepreneur of the Year Award for the Northwestern United States in 2001. Past recipients have include Amazon.com, eBay, Southwest Airlines, and Enterprise Rent-a-Car.
- Salvation Army "The Others" Award - In 2007 the Salvation Army awarded Melaleuca with its highest national civic award, "The Others" award", for sending more than $1,000,000 in relief to victims of the Gulf Coast hurricanes of 2005. The company and its people gathered enough food, water, clothing and emergency supplies to fill 11 semi-trucks for the victims of Hurricanes Katrina and Rita.
References
- ^ "Inc. 500 Hall of Fame," Inc. Magazine, September, 2006.
- ^ "Hall of Fame Profile: Frank L. Vandersloot," Inc. Magazine, October 2004.
- ^ Melaleuca Annual Gross Sales, 1985 through 2008 (Company publication)
- ^ a b Inc. 500 Listings
- ^ Melaleuca | Safer for Your Home - from Melaleuca, Frank VanderSloot, CEO
- ^ U S Food and Drug Administration Home Page
- ^ Inc. 500 Hall of Fame
- ^ American Psychological Association Healthy Workplace Award
- ^ Healthy Workplace Award
- ^ Environmental Excellence Award
- ^ Earnst & Young and CNN Entrepreneur of the Year Award
- ^ Entrepreneur of the Year Award
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^
Post Register
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(205): B1, May 24, 2007
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