專訪美樂家總裁範德士原文：
Forbes 400
If You Believe
Phyllis Berman, 10.11.04
Put your faith in thrift, hard work and Melaleuca's household products and you can better your lot in life. Also Frank VanderSloot's.
Frank L. VanderSloot sells items like Classic Tooth Polish ($3 a tube), Replenex (90 glucosamine pills for $10) and Nicole Miller Timeless Age Defying Serum ($18 a bottle). He doesn't hit the road himself to ring doorbells. At 56, his sales days are far behind him. He leaves the pitching to an army of part-time hucksters who sell these and 350 other household and "health" products for Melaleuca, his privately held firm in Idaho Falls, Idaho.
Melaleuca is a pyramid selling organization, built along the lines of Herbalife and Amway. Vendors get commissions on the products they sell and also on products sold by vendors they recruit. From a near-standing start 19 years ago, VanderSloot has built his firm up to an expected $620 million in volume this year, roughly half of that to be paid out to the vendors as commissions. A few of them make a very good living off Melaleuca; most do not. Enough of the money lands at the top that VanderSloot's 50% share of the business, we estimate, is worth $700 million.
"This is not a get-rich-quick scheme," says the entrepreneur, referring to what his sales force can make, though he insists that the income of a hard-working "marketing executive" can still "make a real difference to a family earning $30,000," he says.
Such talk sounds patronizing--until you realize that VanderSloot seems to believe his own sermon. Ever since he took over what was then a small and poorly managed company in 1985, he has preached (and practiced) frugality: Live within your means, he frequently tells his sales force, pay off your debts, think twice about that new car. You see it reflected in the 36,000-square-foot headquarters, a two-story concrete affair (and former hardware store) in a strip mall. And, in a departure from many multilevel marketing schemes, VanderSloot is insistent about not burdening new recruits with huge startup costs or a garageful of inventory. Everyone buys a $29 kit, crammed with sales materials for demonstrations as well as VanderSloot's motivational tips, and signs up to buy a minimum of $45 a month worth of Melaleuca wares--from a $2 Hot Shot, a breath spray, to a $30 bottle of ProVec CV, a grape seed extract that supposedly reduces LDL, the bad cholesterol. (VanderSloot says anyone can opt out of the $45 commitment.) Most of the items have a health or environmental flavor to them, like sunscreen with Vitamin E or phosphate-free detergent.
VanderSloot is pretty up-front about how tough it is for most salespeople to earn any money. And unlike, say, Amway, Melaleuca tells its new recruits that they're starting out as customers on the bottom of a towering pyramid. There are approximately 150,000 of these participants, buying the soaps and potions for themselves but not yet making any significant sums from their 7% commissions (350,000 people are pure customers). As they move up the rungs, though, they can see some revenue, because they get 7% as well on sales by vendors they have recruited (the chain of commissions extends to seven levels). It appears that there are 30,000 or so serious players near the bottom averaging $1,750 a year in commissions.
The big bucks, of course, go to those who sign a large number of disciples who go on to recruit other vendors. Senior directors, as they're called, have 650 customers in their network, of whom 25 or so are actively recruiting. Executive directors claim 2,400 or more customers, with perhaps 90 of them on the proselytizing trail. This crew of veterans, of whom there are 359, can expect $186,000 a year in commissions plus $1,000 a month from Melaleuca toward their automobile costs. Leading producers: three presidential directors who got commissions topping $1 million in 2003. VanderSloot thinks five people will scale those heights this year.
Before VanderSloot bought into the company, it subsisted on a handful of products tied to the melaleuca, or "tea tree" of Australia. Discovered in New South Wales in 1922, the melaleuca sprouts leaves that supposedly have antiseptic and analgesic properties. Colleagues at Cox Communications, where VanderSloot was a regional vice president, were so skeptical of his move that as a parting gesture they set up a tree and strung tea bags from it.
VanderSloot soon discovered the company's putative 80% ownership of the tea trees in Australia was really more on the order of 5%. Moreover, Melaleuca's claims about the health benefits of oil extracted from the leaves of the trees were a bit shaky. And distributors were griping about being forced to purchase large amounts of inventory that piled up in their garages.
VanderSloot shut down the company, purchased its inventory, trademarks and product recipes and rechristened it Melaleuca. Half his 1,000 distributors quit. Reason: They couldn't pass along tons of inventory to salespeople below them in their networks, thereby depriving the earlycomers of quick profits. "At the beginning it was just me and some ladies in the office," he recalls.
To rebuild the business, VanderSloot created an R&D department that evolved into a 20-person staff, including three Ph.D. chemists. The company has racked up nine U.S. patents--from inhibiting adenosine (an enzyme that prevents fat-burning) in an energy bar to the use of benzophenone in a shampoo to protect hair from ultraviolet exposure. VanderSloot insists his salespeople also tout the price advantage of his products. Melaleuca's detergent, for instance, costs 16 cents per load versus 28 cents for Tide.
There have been bumps. In 1991 the Idaho attorney general's office investigated Melaleuca because some of its vendors were claiming that the business had the seal of approval of the Idaho attorney general's office, when it hadn't. The company signed an assurance of voluntary compliance, promising to police its sales force. Since then that state office has received 120 complaints about Melaleuca, mostly gripes from customers who didn't realize their credit cards would be automatically debited $45 a month or thought the company too slow to credit their accounts for returned products. The AG's office says it has resolved them all.
A different problem emerged in 1998. When sales flattened, VanderSloot did some digging and discovered that some senior directors were living off their residuals and doing little in the way of recruitment. Result: a new policy that reduced payments to those who didn't either bring in new converts or help others do so. Since then, company revenues have grown at a compound annual rate of 12%.
Most Melaleuca salesfolks work hard and listen to VanderSloot's advice about cleaning up their lives. Cathy Blandino of Las Vegas recently sent him a package containing the shredded remains of her 36 credit cards, on which she owed $64,000, all paid off over five years with help from her company earnings (she scaled back her efforts and brought home $5,800 last year). "We could never have done this without Melaleuca," she added in a note.
VanderSloot reinforces the message. When one of his sales staff pays off a home, he flies to the nearest airport, shows up and throws a mortgage-burning party. Over the last four years he and his wife, Belinda, went to 31 such events. That's on top of all the incentives to spur sales, from $2 inspirational tapes and an annual Fourth of July party in Idaho Falls (the largest display of fireworks west of the Mississippi) to the lure of car payments and exotic vacations with Frank and Belinda for the biggest producers.
Corny though they are, these gestures go the heart of VanderSloot's values: hard work, decent rewards and simple living. Growing up on a tiny farm in Cocolalla, Idaho, VanderSloot, a devout Mormon, milked cows and fed the chickens while his father worked all week on the railroad. He put himself through Brigham Young University by selling beef jerky in bars and convenience stores. He spent 15 years as a middle manager at ADP and Cox. Though he is a rich man today, VanderSloot is only now allowing himself a few indulgences--a herd of Black Angus (see sidebar, p. 90) and a recently built 10,000-square-foot, 17-bedroom home (cost: $1.5 million).
He sure doesn't spoil any of his 14 kids, ranging in age from 14 to 33. VanderSloot signs a contract with each one detailing his expectations. Starting at age 12, they all get full-time summer jobs, usually at fast-food joints, then work two hours at a job--sometimes on VanderSloot's ranch--each day after school. He has agreed to pay for college if they maintain a 3.0 average (two had to drop out). Dad doesn't pay for their weddings; instead, he offers the brides a set amount--he won't specify how much--to spend as they want. "Tell 'em that and soon they say, 『We can do without all those fancy flowers,'" he explains.
VanderSloot dabbles in politics. In 1999 he spent an undisclosed sum to sponsor billboards around the state asking rhetorically whether taxpayer money should be used to support It's Elementary, a public TV program exploring how four schools dealt with homosexuality. Two years later he supported radio and TV spots knocking Morgan Stanley Dean Witter's Idaho Falls office because its New York headquarters had invited former President Clinton to speak at its bond conference. One of his favorite causes is Concerned Citizens for Family Values, which in 2002 paid for ads that helped defeat a defense lawyer--"A liberal's liberal," says VanderSloot--running for state attorney general.
Most of his energy still goes into building the business. Melaleuca has pushed overseas, with 25% of revenues coming from Taiwan, Korea, Japan, Australia, New Zealand and the U.K. Now he's selling services, too, including a Sprint calling plan and a dial-up Internet connection. (He's dropping discount travel since he can't compete with the likes of Expedia.com.) The latest thing: home mortgages. Sell for Melaleuca for the next 30 years and you'll get a free burning party.
美國《Forbes 400》雜誌專訪美樂家範德士總裁譯文
法蘭克·范德士所販賣的產品包括潔齒牙膏、勁捷能、以及妮可。米勒時光多酚精華液；也不是挨家挨戶親自販售，今年56歲的他，早已告別業務員生活。在範德士位於愛達荷州的美樂家公司裡，有一群陣容堅強的兼職事業代表團隊，可以幫他銷售產品品項達350種之多、健康取向的家庭用品。
美樂家是一家消費者直效行銷的公司，與賀寶芙、安麗…等公司統稱為組織行銷公司是大不相同的。事業代表賺取顧客消費產品所得的佣金，以及他們介紹進來的新顧客購買產品時，所產生的佣金。從19年前創業維艱成立美樂家，到2004年營業額超越6.34億美元，其中大約有一半左右付給事業代表作為佣金。不少事業代表在美樂家獲得非凡自由，而大多數事業代表則尚在努力中。有許多的獎金是設計給高階事業代表，以範德士所擁有50％以上的公司股份為例，我們預估他大約有7億美元的身價。
談到事業代表的收入，範德士認為「美樂家提供的並不是快速致富的方法」，但他堅持，一位辛勤工作的事業代表的年收入，與平均年薪三萬美的家庭相比，絕對有很大的差異。
這句話或許口氣很大，但是連範德士本人都深信他自己的這個信條。自從他於1985年接手這家當時經營不善的小公司時，便倡導並且力行勤儉之道；他經常告訴事業代表們：不超支、把貸款還清、換新車前請三思……等。在美樂家總公司可以看到這個原則；總部位於商店街中，面積36.000平方英呎的兩層式水泥建築。另外，與其它直銷公司最大的差異是，在範德士的堅持之下，新會員不需要高額創業金，也不需預購大量的商品囤貨販賣，每一位事業代表會購買一套29美元的美樂家富足錦囊－包含產品目錄以及範德士激勵語錄；並約定每月購買45美元的美樂家產品～從２美元的口腔芳香噴劑，到30美元的寶維適CV等各項產品(任何人都可以選擇退出45美元固定消費額的約定)。美樂家產品以健康或環保為訴求，例如防曬乳液添加維他命Ｅ，或是洗碗精不含磷酸鹽等。
範德士很坦白地表示，對許多美樂家的事業代表而言，一開始賺大錢並不容易。美樂家很明白地告訴新會員，他們必須從優惠顧客開始進入這個事業。目前約有15萬兼職事業代表，購買產品自己使用，但並不以賺取佣金為主（美樂家約有35萬純消費型會員）。當這些最基層的事業代表往上晉升時，才會開始賺取佣金，隨著他們新推薦會員的消費行為，開始賺取7%以上的佣金。目前，全球大約有三萬名基層經營者，年平均佣金為1,750美元。
在美樂家真正賺取豐厚收入的，是推薦「有能力推薦新會員」的資深總監級以上經營者。一位資深總監的組織約有650位的會員顧客，其中大約有25名會積極推薦新會員加入。執行總監則大約有2,400位以上的會員顧客，其中有90名左右的積極經營者，會持續進行推薦。這群資深的美樂家執行經營者，共計有359名，每年平均可獲得186,000美元的佣金，以及每月1,000美元交通津貼。金字塔最頂端的領導人～2003年有三位企業總監，每位平均領到1,000,000美元以上的佣金；範德士認為在2004年大約有五位企業總監可以達到這個水準。
在範德士開始經營美樂家之前，這家茶樹精油公司即經營許多與茶樹精油相關產品。在範德士加入這家茶樹精油公司之前，他原本是寇克斯通訊公司的區域執行副總；同事們對於範德士加入茶樹精油公司的決定抱持懷疑心態，在歡送時，同事們甚至還找來一顆樹，上頭掛滿了茶葉包。
在加入這家茶樹精油公司之後，範德士很快地發現，原本公司號稱擁有80%澳洲地區的荼樹所有權，實際約只有5%而已。而他們對外宣稱的茶樹精油擁有的健康功效，也缺乏科學根據；另外，當時經銷商也抱怨被強迫買下產品，造成囤貨壓力。
範德士不喜歡這種營運模式，決定買下茶樹精油公司加以重整，創立美樂家公司。當時約1,000名的經銷商中，有一半選擇離開。原因是他們無法處理庫存問題，也因此無法賺取佣金。範德士憶及當時情境，提到「辦公室就只有跟幾位女士而已」。
為了重新打造美樂家公司，範德士成立「研發部門」，現在這個部門由20名研發人員及三位化學博士所組成，陣容強盛；因此美樂家已累計取得九項美國專利，例如活力棒、絲毫護髮造型系例等。範德士也堅持事業代表一定要跟消費者提到產品價格優勢。如相同品質價格更優惠，相同價格品質更優質。
#####美樂家經營史也不乏遇到挫折之時
1998年業績成長遲緩，範德士深入深究後發現：某些資深總監級經營者，領取佣金後安逸於優異生活，不再積極推薦新會員。於是宣布一項新政策：經營者必須持續推薦新會員，或是幫助夥伴推薦會員，才能獲得佣金發放。從那時起，美樂家每年的年平均業績成長率皆達12%.對會員的激勵方式，也顯現範德士的核心價值：辛勤工作、可觀的報酬以及簡約的生活方式。
大部份的美樂家事業代表在辛勤工作時，也聽從範德士的忠告：要讓生活保持簡單不負擔。拉斯韋加斯的Cathy Blandino，寄給他一個包裹，裡面是她36張被剪碎片的信用卡。在公司收入的幫助下，五年內還清高達64,000美元的信用卡債。
Cathy並在包裹裡放一張紙條寫道：「沒有美樂家，我們不可能做得到！」
範德士大力倡導簡約生活原則。當他的事業代表付清房貸，他會飛到最接近他的的機場，在當地舉行並出席「終結房貸派對」：過去四年來，他和妻子Belinda已經參加31場派對，此外，他運用各種獎勵方法刺激業績，從２美元的激勵瀑布派對、汽車贈予等，都是常用的激勵方法。另外，最頂尖的事業代表，還可以與範德士及其夫人一同到國外旅遊渡假。
這些激勵方式或許簡單，但卻顯現了範德士的核心價值觀：辛勤工作、可觀的報酬以及簡約的生活方式。範德士是一個虔誠的摩門教徒，成長於愛達荷州Cocolalla鎮小農場，他的父親每日在鐵路公司辛勤工作時，他則會幫忙家裡擠牛奶及餵雞。他靠著在酒吧及便利商店賣午肉乾的收入，完成楊百翰大學學業。之後，在ADP及Cox公司工作15年並任職中階主管。今日，即使範德士擁有上億身價，他依舊只有一、二件奢侈品，例如一群黑安格斯牛、一棟價值150萬美元的新房子(17個房間、佔地一萬平方呎)。
範德士對14名子女的管教方式也相當嚴格，決不溺愛。他與每位子女都籤一份合約書，詳載對每位子女的期待。所有子女從12歲開始，每年暑期都要在餐廳或快餐店全職工作；另外，求學期間在每天放學之後必須工作2小時。他同意支付子女的大學學費，條件是每學期平均成績必需在GPA3.0以上(有二位子女因而退學)。範德士不支付子女婚禮費用，但是他會給新娘一筆錢供婚禮使用，若有剩餘，則可自已留用。範德士進一步提到，不久之後他的子女們會了解：「婚禮，其實並不需要華麗的鮮花來裝飾!」
當然，範德士的重心仍然放在「如何擴展美樂家的事業版圖」。美樂家早已拓展至海外市場，目前25%的營業額來自臺灣、日本、韓國、澳洲、紐西蘭以及英國。而現在美樂家業務也與服務結合，包括Sprint電信公司的電話服務，以及網際網路的撥接服務。目前最新的服務，則是繳清房貸的項目!只要在美樂家工作30年，您就會獲得一個免費的「終結房貸派對」