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.
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
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 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 *.
In 2000, Amway was restructed to become a part of holding company Alticor. Alticor and Quixtar sales data is reported as actual sales.
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.
Alticor Sales Data
|2000||3.84 Billion (5.1 Billion ERP*)|
|2001||4.1 Billion (5.4 Billion ERP*)|
- ↑ Amway Parent Hits 50th year running recording 15% sales growth
- ↑ Amway Parent grows to $8.4 billion in 2009
- ↑ Amway posts record sales, expands in Michigan and Asia
Amway Sales Data
Until 1999 sales were reported at Estimated Retail. This is approximately 32% higher than actual sales revenues from sales made to Amway distributors.
|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 billion||1990||$2.2 billion|
|1961||$1 million||1971||$165 million||1981||$1.4 billion||1991||$3.0 billion|
|1962||$2 million||1972||$180 million||1982||$1.5 billion||1992||$3.9 billion|
|1963||$6 million||1973||$210 million||1983||$1.13 billion||1993||$4.5 billion|
|1964||$10 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 ||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|
Quixtar North America Sales Data
|Year||Quixtar||Partner Stores||IBO Bonuses|
|2000||$448 million||$70 million||$143 million|
|2001||$751 million||$65 million||$230 million|
|2002||$901 million||$57 million||$282 million|
|2003||$1.035 billion||$58.3 million||$343 million|
|2004||$1.1 billion||$68.5 million||$373 million|
|2005FY*||$1.058 billion||$76 million||$345 million|
|2005CY*||$1.094 billion||$75.5 million||$350.4 million|
|2006||$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.
- ↑ Amagram North America No.9 Vol.12
- ↑ Quixtar IBOs drive $518 million in sales
- ↑ Independent Business Owners Powered by Quixtar Drive $751 Million in E-Commerce Sales
- ↑ Quixtar Inc. Reports Sales of $901 Million
- ↑ Independent Business Owners Generate Record $1 Billion in Sales for Quixtar
- ↑ Quixtar Announces Record Annual Sales of $1.1 Billion; Health & Beauty Products Fuel Growth
- ↑ Quixtar Reports Third Consecutive Year Of Billion-Dollar Sales
- ↑ 8.0 8.1 Quixtar Reports Fourth Consecutive Year Of Billion-Dollar Sales
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.