Market Overview

Direct Selling Market is Growing Globally

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Direct Selling Market is Growing Globally

FinancialBuzz.com News Commentary

PR Newswire

NEW YORK, April 9, 2018 /PRNewswire/ --

Direct selling describes the sale of products or services directly to consumers by independent sales representatives, a method which eliminates middlemen such as wholesalers and retailers. According to data published by Euromonitor, the direct selling market is a major global retail channel worth US$134.2 billion in 2016 and is expected to experience a resurgence over the next few years to reach US$163.1 billion by 2020 with a CAGR of 4.9%. World Federation of Direct Selling Associations (WFDSA) elaborates that the United States is the largest direct selling market, valued at US$35.5 billion in 2016, while China takes the 2nd place at US$33.9 billion. Sharing Services, Inc. (NASDAQ:SHRV), Youngevity International, Inc. (NASDAQ:YGYI), LifeVantage Corporation (NASDAQ:LFVN), Vince Holding Corp. (NYSE:VNCE), Cott Corporation (NYSE:COT)

A wide variety of sectors use the direct selling approach. Coresight Research reported that, Wellness is the largest product category in direct selling, generating US$63.5 billion in revenues in 2016, up 40.1% from 2013. Cosmetics and personal care follows as the second-largest product category, valued at US$48.3 billion in 2016. The success of direct selling in these two categories can largely be attributed to the personalized service provided by sales representatives.

Sharing Services, Inc. (OTC:SHRV) earlier last week reported breaking news that, "gross sales for the one month of February exceeded total sales for the past quarter. February sales are to be reported at just over $1.1 million, representing another new milestone and diligence in executing the company's corporate growth strategy.

"We are very excited that after just our third month since launching our incredible health and wellness division we have achieved sales of just over $1.1 million dollars," stated CEO John "JT" Thatch. "Our team members have executed our go-to market strategy flawlessly, and our customers have accepted these products with enthusiasm into the marketplace."

He added, "In the future, we will continue to exceed our goals by not just putting record-breaking revenues on the books but bringing satisfaction to our customers by providing them with all the best products and training available."

Sharing Services continues to gain traction in the direct selling industry, in which the company owns, operates or controls an interest in companies that offer services ranging from manufacturing, processing, training and travel benefits. In recent months, the company has taken several steps to support its pursuit of international expansion, including establishing a new corporate headquarters to accommodate growth as well as entering into a joint-venture agreement to market its Elepreneur Brand and products in Asia. Moving forward, the company anticipates continued momentum and brand building on a global scale."

Robert Oblon, chairman of Sharing Services, added, "We exceeded our goals this past month as we continue our record-breaking pace within direct selling, but our best-in-class products and services are proving the concept on our very unique Blue Ocean Strategy."

Youngevity International, Inc. (NASDAQ:YGYI) is a leading omni-direct lifestyle company - offering a hybrid of the direct selling business model, that also offers e-commerce and the power of social selling. In March, the company announced the acquisition of ViaViente, distributors of The ViaViente Miracle, a highly-concentrated, energizing whole fruit puree blend that is rich in Anti-Oxidants and naturally-occurring vitamins and minerals. ViaViente, was introduced to the public in 2003 following years of research that included studies of mineral rich waters whose source is found in the Andes Mountains and flow thru Vilcabamba, Ecuador, a region known for its high concentration of centenarians. In 2007 ViaViente became the first product in the market to receive the coveted Brunswick Labs ORAC Seal of Certification for its Anti-Oxidant content.

LifeVantage Corporation (NASDAQ:LFVN) is a pioneer in Nutrigenomics - a new science dedicated to biohacking the human aging code. The company is engaged in the identification, research, development and distribution of advanced nutraceutical dietary supplements and skin care products. LifeVantage is a proud member of the Direct Selling Association. LifeVantage recently launched Vitality StackTM Packets, a portable version of its successful Vitality StackTM product. The initial cyberlaunch was followed up at Elite Academy with a formal introduction to over 4,500 distributors with training to support the launch. The Company introduced a new customer acquisition program that will provide a better experience for customers and a potential additional source of revenue for distributors. Currently, LifeVantage sells products exclusively through its network of independent distributors. Beginning in March, new customers in the U.S. will be able to purchase products at LifeVantage's corporate website and will be auto-assigned to distributors who are new to the company and active in their business following the initial purchase, opening up a new pool of potential customers.

Vince Holding Corp. (NYSE:VNCE) is a global luxury brand best known for utilizing luxe fabrications and innovative techniques to create a product assortment that combines urban utility and modern effortless style. Vince products were sold in prestige distribution worldwide, including approximately 2,400 distribution locations across approximately 40 countries. With corporate headquarters in New York and its design studio in Los Angeles, the Company operated 40 full-price retail stores, 14 outlet stores and its e-commerce site. In February, the company announced unaudited preliminary sales results for the fourth quarter ended February 3, 2018. For the quarter, net sales increased approximately 14.0% to $73.0 million, excluding an estimated $1.5 million from the 14th week, compared to $63.9 million in the fourth quarter of fiscal 2016. Direct-to-consumer segment sales increased approximately 17.5% to $34.5 million as compared to the same period last year, excluding sales from the 14th week.

Cott Corporation (NYSE:COT) is a route-based service company with a leading volume-based national presence in the North America and European home and office bottled water delivery industry and a leader in custom coffee roasting, blending of iced tea, and extract solutions for the U.S. foodservice industry. Last month, the company announced the completion of the cash tender offer by its wholly owned subsidiary, CR Merger Sub, Inc., for all of the outstanding shares of common stock of Crystal Rock Holdings, Inc. Crystal Rock is a 100 year old direct-to-consumer home and office water, coffee, filtration and office supply service delivery business serving customers throughout New York and New England. It bottles and distributes natural spring water under the Vermont Pure® brand, purified water with minerals added under the Crystal Rock® Waters label and it roasts and packages coffee under its Cool Beans® brand.

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