Amway History and it's business

Amway is one of the world's largest and oldest multilevel marketing companies (MLM). Founded as "JaRi Corporation" in 1949 and renamed "Amway Corporation" in 1959, the company restructured in 1999 and became a part of the Alticor holding company. The same year, Alticor launched a sister company to Amway, Quixtar with a focus on utilizing the internet. By 2001 the majority of Amway distributors had transferred to Quixtar and Amway North America was merged into Quixtar. In 2007 Quixtar announced that they were reviving the Amway brand in North America and the Quixtar name would be phased out.

History

In the early 1930's, Carl Rehnborg began selling the first major line of vitamins in the United States through his "California Vitamin Corporation", which changed its name to Nutrilite Products Company, Inc. in 1939.
In 1945, Nutrilite contracted with a company owned by Lee Mytinger and William Casselberry to become the exclusive American distributor of Nutrilite vitamins. Mytinger and Casselberry started the first major MLM with the same basic principle that underlies the industry today. Each independent distributor would be entitled to make a commission on his or her own sales of Nutrilite products and an override commission on the sales made by those the distributor recruited below them as additional distributors and from those recruited by them and so on.

Mytinger was a salesman and Casselberry was a psychologist. The original Nutrilite vitamin was a combination of vitamins and minerals in a base of alfalfa, parsly, and watercress. They marketed it with the vegetables to make it unique from other products. In the forties and fifties, they sold the material in strength and double strength (Double X) at $20 a month.

Rich DeVos and Jay Van Andel became distributors of "Nutrilite" vitamins in Mytinger and Casselberry's network. On September 6, 1949, DeVos and Van Andel incorporated their Nutrilite distributorship in Michigan as Ja-Ri Corporation.


By the late fifties, Van Andel and DeVos and other distributors had been experiencing troubles with their supplier, Nutrilite Products Company, Inc., and Mytinger & Casselberry, Inc. . Mytinger & Casselberry were in the midst of an investigation and prosecution by the Food and Drug Administration for making false health claims about Nutrilite products. A small group of distributors was appointed, with Van Andel as the chairman, to try to work out an arrangement with Nutrilite.
 
Van Andel and DeVos decided that their suppliers were in great danger of collapsing and that they should go into the business themselves, producing their own products and selling them through the Ja­Ri sales organization which had more than 2000 distributors as members. They put together an organization of distributors called the American Way Association, the name of which was later changed to the Amway Distributors Association (this later became North America's "Independent Business Owners Association International" or IBOAI). The primary purpose of this organization was to allow Van Andel and DeVos to communicate with their Nutrilite distributors in the Ja­Ri organization and to hold the business together until they could develop their own manufacturing operation.

Van Andel and DeVos had to be very careful in changing their distributor organization, with its allegiance to Nutrilite food supplement products. Since the distributors were independent, they might quit. It was therefore necessary for Van Andel and DeVos to have these distributors concur in their plans to set up a product distribution and manufacturing operation; and they discussed the type of products they intended to produce with the distributors' association. Many of the distributors in the organization joined the American Way Association, and began distributing products sold to them by Ja-Ri Corporation/Amway Corporation. There were originally 35 Nutrilite distributors who joined as the first distributors of what would become Amway. The first president of the Amway Distributors Association was Walter Bass.

They decided to look for products which were readily consumable, relatively low-­priced, different from those found in retail stores, and which would lead to repeat sales. They chose soap and detergents because they felt it would be the easiest market to train distributors to sell. Van Andel and DeVos began distributing through the Ja­Ri a liquid detergent called 'Frisk', which they renamed LOC (liquid organic compound) and which is still one of the principal Amway products. This product was manufactured by Eckle Company, a small supplier in Detroit, Michigan, and it was one of the only biodegradable liquid detergents available at that time. Van Andel and DeVos, through Ja­Ri Corporation, acquired the company, moved the assets to Ada, Michigan, and changed its name to Amway Manufacturing Company. A few months later they introduced SA8, a biodegradable powder detergent.

In November 1959, Van Andel and DeVos organized "Amway Sales Corporation" and "Amway Services Corporation." In November 1963, the name of "Ja­Ri Corporation" was changed to "Amway Corporation"; and on January 1, 1964, Amway Sales Corporation, Amway Service Corporation, and Amway Manufacturing Corporation were merged into Amway Corporation. Amway subsequently purchased Nutrilite, which is a flagship brand in Amway/Quixtar still today.

Today, "Amway Corporation" has yet another new name, Alticor, Inc., however, it is still the same Michigan Corporation that started as DeVos and Van Andel's Nutrilite distributorship in 1949. Alticor, Inc. owns a number of companies, including -

• Quixtar, a Virginia corporation formerly known as "Amway USA, Inc." that operates the old Amway sales system in the United States and Canada.

• Amway Corporation, a new subsidiary formed in Delaware after Amway changed it's name to Alticor.

• Access Business Group, which is the product manufacturing and development arm of Alticor/Amway/Ja-Ri.

• Fulton Innovation, a research and development group

Business

Amway has grown fairly quickly since its inception. Its historic sales data at estimated retail prices is provided below from 1959 to 2000 (in 2000 Amway switch over to Alticor. At its peak in 1997 Amway estimated retail sales worldwide at 7 Billion USD. With the founding of Alticor, the report methodology was changed and the actual sales to distributors instead of estimated retail sales (ERS) have been reported since 2001. Taking the sales data published in 2001 report into account, the ERS values are about 32% higher than sales to distributors. The actual sales to distributors are marked with *.

Amway Sales Data

Amway has grown fairly quickly since its inception. Its historic sales data at estimated retail prices is provided below from 1959 to 2000 (in 2000 Amway switch over to Alticor. At its peak in 1997 Amway estimated retail sales worldwide at 7 Billion USD. With the founding of Alticor, the report methodology was changed and the actual sales to distributors instead of estimated retail sales (ERS) have been reported since 2001. Taking the sales data published in 2001 report into account, the ERS values are about 32% higher than sales to distributors. The actual sales to distributors are marked with *.

Year	Estimated Retail Sales	Year	Estimated Retail Sales	Year	Estimated Retail Sales	Year	Estimated Retail Sales
1960	$0.5 million	1970	$120 million	1980	$1.1 billion	1990	$2.2 billion
1961	?	1971	$165 million	1981	$1.4 billion	1991	$3.0 billion
1962	?	1972	$180 million	1982	$1.5 billion	1992	$3.9 billion
1963	$21 million	1973	$210 million	1983	$1.13 billion	1993	$4.5 billion
1964	$25 million	1974	$230 million	1984	$1.2 billion	1994	$5.3 billion
1965	$38 million	1975	$250 million	1985	$1.2 billion	1995	$6.3 billion
1966	$40 million	1976	$300 million	1986	$1.3 billion	1996	$6.8 billion
1967	$50 million	1977	$375 million	1987	$1.5 billion	1997	$7.0 billion
1968	$65 million [1]	1978	$500 million	1988	$1.8 billion	1998	$5.7 billion
1969	$85 million	1979	$800 million	1989	$1.9 billion	1999	$5.0 billion

Until 1999 sales were reported at Estimated Retail. This is approximately 32% higher than actual sales revenues from sales made to Amway distributors.
In 2000, Amway was restructed to become a part of holding company Alticor. Alticor and Quixtar sales data is reported as actual sales.

Quixtar North America Sales Data

Year	Quixtar	Partner Stores	IBO Bonuses
2000[2]	$448 million	$70 million	$143 million
2001[3]	$751 million	$65 million	$230 million
2002[4]	$901 million	$57 million	$282 million
2003[5]	$1.035 billion	$58.3 million	$343 million
2004[6]	$1.1 billion	$68.5 million	$373 million
2005FY*[7]	$1.058 billion	$76 million	$345 million
2005CY*[8]	$1.094 billion	$75.5 million	$350.4 million
2006[8]	$1.118 billion	$84.6 million	$370.1 million
2007	$1.072 billion	$70.1 million	$363.0 million

Note: In 2006 Quixtar switched from a Sept 1-Aug 31 Financial Year to using the Jan 1-Dec 31 calendar year as the Financial Year. Both data is provided for 2005 to allow comparisons.

Alticor Sales Data

Year	Sales (USD)
2000	3.84 Billion (5.1 Billion ERP*)
2001	4.1 Billion (5.4 Billion ERP*)
2002	4.5 Billion
2003	4.9 Billion
2004	6.2 Billion
2005	6.4 Billion
2006	6.3 Billion
2007	7.1 Billion
2008	8.2 Billion[9]
2009	8.4 Billion[10]
2010	9.2 Billion

1. ^ Amagram North America No.9 Vol.12
2. ^ Quixtar IBOs drive $518 million in sales
3. ^ Independent Business Owners Powered by Quixtar Drive $751 Million in E-Commerce Sales
4. ^ Quixtar Inc. Reports Sales of $901 Million
5. ^ Independent Business Owners Generate Record $1 Billion in Sales for Quixtar
6. ^ Quixtar Announces Record Annual Sales of $1.1 Billion; Health & Beauty Products Fuel Growth
7. ^ Quixtar Reports Third Consecutive Year Of Billion-Dollar Sales
8. ^ ^{a b} Quixtar Reports Fourth Consecutive Year Of Billion-Dollar Sales
9. ^ Amway Parent Hits 50th year running recording 15% sales growth
10. ^ Amway Parent grows to $8.4 billion in 2009

Alticor/Amway Historical Sales (graph)

Amway global sales were reported at estimated retail until 2000 when the holding company of Alticor was formed. Alticor reported sales are for actual revenue. In the graph below estimates of Amway actual sales and Alticor estimated retail sales are included for comparison purposes. Note that Alticor sales includes revenues from other sources such Access Business Group and Amway Grand Plaza. Sales are reported in USD millions.

Respected People, Respect Amway

This video from 1999 includes a series of soundbites from respected leaders in business and government with their views on the Amway and Quixtar companies and business opportunity. It includes endorsements of Amway and Quixtar from -

Thomas Donahue, President, United States Chamber of Commerce

Sam Jadallah, Vice President, Enterprise Sales, Microsoft

Stephen Covey , Author, The 7 Habits of Highly Effective People

Rich Karlgaard, Publisher, Forbes

Jolene Sykes, Publisher, Fortune

Hyrum Smith, Co-chairman of the Boad, Franklin Covey

Wolfgang Schmitt, Chairman, Rubbermaid

R. Craig Hoenshell, Chairman, CEO, AVIS

Jack Haire, Publisher, Time

Stuart Silver, Co-Designer, Ronald Reagan Presidential Library

Dr Noel Brown, President, Friends of the United Nations

Brian Segal, Publisher, Macleans

Carolyn Wall, Publisher, Newsweek

John Engler , Governor, State of Michigan (1991-2002)

Gary Player , Professional Golfer

Amway and UNICEF

Since 2001, Amway affiliates in Europe have been a major corporate partner of UNICEF's immunization efforts (read more on Amway and UNICEF here ). This video shows Unicef Goodwill Ambassador Roger Moore thanking Amway and Amway IBOs for their support.

Posted in: Amway History