The success or failure of any business enterprise largely hinges on the abilities of the owner to both develop and run a business. If the business is based on a multi-level or network marketing strategy then another subset of skills is required. This is especially true for the Usana business model, an International MLM specializing in vitamin, nutritional drinks and bars, as well as and skin-care products.
In line with being an MLM, the products offered by Usana are only available through the company website or their authorized distributors. The distributors are recruited by other distributors, in order to establish a matrix of active and passive income. This matrix of distributors is commonly referred to as a line or downline. The theory is, the larger the downline, the greater the possibility for compensation.
On the surface, the business model looks relatively simple. There is, however, a significant gap between theory and reality. There is nothing nefarious in this gap, but knowledge is power in the aligning of theory and reality. The most relevant knowledge lies in the company sales statistics.
According to their own financial statements for 2009, Usana Health Sciences netted over $400 million in sales; an impressive figure. It is the breakdown of these sales that are most worthy of being noted. 89% of the netted sales are attributed to the distributors and 11% by what they term preferred customers. Preferred customers sign up for free on the company website in order to receive a 15%-25% discount on retail prices. The higher percentage is earned with a monthly purchase commitment.
The preponderance of sales to the Associates is attributable to the structure of the payment plan. The plan relies heavily on an accumulation of points in conjunction with meeting preset quotas. Actual payouts are not made until all qualifying factors are satisfied. It is extremely likely that a non-compliant Associate could work the model and not yield any commissions.
One of the quota levels centers on the monthly purchase of product. Points are earned or lost depending on how well the quota is met or exceeded. Success is found in not just meeting the monthly quota, but exceeding it. The same concept applies to enlisting a network of Associates. A viable plan for maximizing monthly sales and Associate enlistment needs to be drafted and executed to ensure success within this payment structure.
The company states that only a little more than 2% of their Sales Associates earn the majority of their paid compensation. Knowing that success depends on being in the top 2% should frame the plan for success. Although the Usana business model is structured to support the sales of the company, it also provides the stimulus for being a top producer.