USANA Price List vs NBTY Equivalent Price List Distributors Overcharged To Fund Pyra… · united states usana associate price list vs nbty equivalent price list usanawatchdog ©2015

UNITED STATES

USANA ASSOCIATE PRICE LIST

VS

NBTY EQUIVALENT PRICE LIST

USANAWatchDog ©2015 USANAWATCHDOG.BLOGSPOT.COM Page 1 of 7

See what USANA products could cost if manufactured by a non-MultiLevel Marketing company.

By using USANA’s cost to manufacture each product and applying that same figure to NBTY’s costs, you can see

how much more USANA charges it’s distributors for their products, which is primarily due to USANA’s very high

distributor incentive expense (distributor commissions and bonuses). This also eliminates quality, potency, and

pharmaceutical GMP differences the two companies might have by using the same manufacturing cost. See full

detailed explanation on last page.

USANA DISTRIBUTOR PRICE represents the discounted price USANA gives their distributors. (10% below preferred pricing)

NBTY DISTRIBUTOR PRICE represents the equivalent price if NBTY manufactured the same product instead.

USANA 2014 10K SEC Filing – Average Cost of Sales: 17.81%

NBTY 2014 10K SEC Filing – Average Cost of Sales: 54.29%

Approximated NBTY DISTRIBUTOR PRICE = (USANA DISTRIBUTOR PRICE * 17.81%) / 54.29%

ITEM # PRODUCT

USANA DISTRIBUTOR

PRICE

NBTY DISTRIBUTOR

PRICE

(Approximated)

ES

SE

NT

IAL

S

107 MyHealthPak Custom Custom * 0.328%

100 HealthPak $108.00 $35.43

101 Essentials $44.06 $14.45

101 Essentials Kosher $44.06 $14.45

101 Essentials Green $44.06 $14.45

102 Chelated Mineral $14.81 $4.86

103 Mega Antioxidant $34.16 $11.21

106 Mega Antioxidant without Vitamin K $34.16 $11.21

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ITEM # PRODUCT USANA

DISTRIBUTOR PRICE

NBTY DISTRIBUTOR

PRICE (Approximated)

OP

TIM

IZE

RS

109 Vitamin D $17.96 $5.89

110 Proflavanol C100 $35.96 $11.80

120 Active Calcium $17.06 $5.60

121 Active Calcium Chewable $22.46 $7.37

122 BiOmega $20.21 $6.63

123 CoQuinone 30 $35.06 $11.50

126 Ginkgo-PS $29.65 $9.73

128 Palmetto Plus $22.01 $7.22

129 PhytoEstrin $18.86 $6.19

131 Procosa $27.90 $9.15

134 Visionex $28.31 $9.29

141 Pure Rest $14.36 $4.71

143 Booster C 600 $28.31 $9.29

DIG

ES

TIO

N/D

ET

OX

108 Probiotic $23.36 $7.66

111 Digestive Enzyme $26.96 $8.84

135 Hepasil DTX $30.56 $10.02

226 Fibergy Plus $26.96 $8.84

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DISTRIBUTOR PRICE

NBTY DISTRIBUTOR


MO

TH

ER

/CH

ILD

104 Body Rox $20.25 $6.64

105 Usanimals $12.56 $4.12

144 BiOmega Jr. $15.26 $5.00

151 BabyCare Prenatal Essentials $44.06 $14.45

165 Children’s Complete Duo $22.46 $7.37

NU

TR

IME

AL

209 Nutrimeal Free, Protein Drink Mix $26.96 $8.84

202 Nutrimeal Chocolate Whey, Protein Drink Mix $26.96 $8.84

210 Nutrimeal Dutch Chocolate, Protein Drink Mix $26.96 $8.84

211 Nutrimeal French Vanilla, Protein Drink Mix $26.96 $8.84

212 Nutrimeal Wild Strawberry, Protein Drink Mix $26.96 $8.84

SN

AC

KS

& B

AR

S 236 Peanutty Bliss, Protein Snack $27.86 $9.14

235 Choco Chip, Protein Snack $27.86 $9.14

237 Fudge Delite, Protein Snack $27.86 $9.14

238 Berry Nutty™ Nutrition Bar $35.96 $11.80

RE

SE

T

251 5-Day RESET Kit $99.86 $32.76

251 RESET Kit 4-Pack $346.50 $113.68

AC

CE

SS

OR

IES

752 BlenderBottle $5.36 $1.76

754 Pedometer $13.46 $4.41

291 Pedometer / BlenderBottle Duo $16.16 $5.30

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DISTRIBUTOR PRICE

NBTY DISTRIBUTOR


RE

V3

138 Rev3 Energy $28.76 $9.43

139 Rev3 Energy Surge Pack $28.76 $9.43

139 Rev3 Energy Surge Pack $47.70 $15.65

SK

IN C

AR

E

300 Gentle Daily Cleanser $15.26 $5.00

301 Hydrating Toner $12.56 $4.12

302 Daytime Protective Emulsion w/ SPF 15 $31.73 $10.41

303 Night Renewal Crème $30.15 $9.89

304 Serum Intensive $35.33 $11.59

305 Perfecting Essence $41.63 $13.66

306 Eye Nourisher $20.66 $6.78

307 Rice Bran Polisher $13.46 $4.41

308 Nutritious Crème Masque $15.26 $5.00

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DISTRIBUTOR PRICE

NBTY DISTRIBUTOR


BO

DY

& H

AIR

CA

RE

311 Energizing Shower Gel $14.36 $4.71

753 Shower Gel Pump $0.23 $0.07

312 Revitalizing Shampoo $14.36 $4.71

313 Nourishing Conditioner $15.08 $4.95

314 Firming Body Nourisher $19.94 $6.54

315 Intensive Hand Therapy $12.15 $3.99

391 Natural Loofah Glove $4.05 $1.33

391 Body Polishing Glove $3.56 $1.17

399 Natural Whitening Toothpaste $7.47 $2.45

760 Mirror $4.95 $1.62

CO

MB

INA

TIO

N P

AC

KS

350 Deluxe Pack w/ Perfecting Essence $145.67 $47.79

350 Deluxe Pack w/ Serum Intensive $145.67 $47.79

350 Deluxe Pack 4-Pack w/ Perfecting Essence $382.50 $125.49

350 Deluxe Pack 4-Pack w/ Serum Intensive $382.50 $125.49

351 Sensé Basic Pack $72.90 $23.92

351 Sensé Basic 4-Pack $190.80 $62.60

354 Sensé Hair & Body Pack $67.95 $22.29

360 Sensé Shower Pack $37.80 $12.40

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By calculating USANA's estimated cost to manufacture each of their products, we can have NBTY manufacture the

same exact product at USANA's estimated cost and determine what a distributor could pay if purchased from

NBTY rather than USANA. This reveals how USANA distributors are paying way too much for USANA

product so USANA can fund their pyramid scheme (see associate incentive expense below).

Example:

USANA HealthPak sold to their distributors for $108

It costs USANA approximately $19.24 to manufacture the HealthPak ($108 * 17.81%)

Now have NBTY manufacture the same exact product and have it cost them $19.24 to manufacture

NBTY could sell the HealthPak to their distributors for only an estimated $35.43 ($19.24 / 54.29%)

Why should USANA distributors be overcharged and left holding the bag?

USANA 10-K 2014 SEC Filings Dollar value in thousands Value % of Net Sales

Net Sales $790,471 100.00%

Cost of Sales $140,794 17.81%

Associate Incentives (Commissions & Bonuses) $349,044 44.16%

Selling, General and Administrative (SG&A) $184,531 23.34%

Advertising (part of SG&A) $4,942 0.63%

Research and Development (part of SG&A) $5,128 0.65%

Earnings from Operation $116,102 14.69%

http://www.sec.gov/Archives/edgar/data/896264/000104746915002349/a2223703z10-k.htm

NBTY 10-K 2014 SEC Filings

Dollar value in thousands Value % of Net Sales

Net Sales $3,205,778 100.00%

Cost of Sales $1,740,417 54.29%

Advertising, Promotion and Catalog $202,754 6.32%

Selling, General and Administrative (SG&A) $952,533 29.71%

Goodwill & Intangible Asset Impairment Charges $207,334 6.47%

Earnings from Operation $102,740 3.20%

http://www.sec.gov/Archives/edgar/data/70793/000104746915008748/a2226563z10-k.htm

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As a distributor, your job is to retail product to customers and the reward is a decent profit margin on the sale.

However, USANA has chosen to make commissions and bonuses (distributor incentives) the primary reward.

USANA pays commission to distributors who have generated "Group Sales Volume" points from product

purchases made by either preferred customers or downline distributors. As a result of USANA's compensation plan,

USANA pays out 43.5% of their sales as distributor incentives, which is reported in USANA 2014 10-K SEC

filings. To put in perspective, the HealthPak sells to USANA distributors for $108. From that, $46.98 is used to pay

commissions, which does not go toward the distributor who retails product, but rather primarily to those with the

largest downlines.

This enormous expense forces USANA to drastically raise the price their products are sold to their distributors to

the point distributors cannot realistically retail the product, not to mention preferred customers get the product at

the same price distributors get it. This causes distributors to focus on selling a business opportunity and recruit new

distributors rather than selling product. In order for distributors to participate in USANA’s compensation plan or

contests, you must personally purchase over $100 worth of product every four weeks. Unfortunately, even though

USANA pays out almost half of their net sales as distributor incentives, the vast majority of distributors never earn

a profit and only a few at the top of the distributor network hierarchy make enough to recognize a profit. The result

is a pyramid scheme. The more distributors in one's downline, the more commission one is likely to receive.

Because distributors are required to personally purchase product, commissions are almost guaranteed to those who

joined earlier and are higher up the chain.

Now that you have a basic understanding of the distributor incentives as a percentage of USANA's net sales, we

must now look at USANA's average cost to manufacture the product. This is known as the "cost of sales" and is

reported in USANA's 2014 10-K SEC filings as 17.81%, which consists of expenses related to raw materials, labor,

quality assurance, and overhead costs directly associated with the production and distribution of the product. So a

$108 HealthPak is estimated to cost USANA $19.24 to produce. In other words, USANA sells the HealthPak to

their distributors at 5.6 times their cost to manufacture and produce that HealthPak.

In contrast, dietary supplement manufacturer NBTY is not a multilevel marketing company. According to their

2014 10-K SEC filings, NBTY’s cost of sales represents 54.29% of the net sales. As a result, NBTY sells product

to their distributors at only 1.8 times their cost to manufacture. One glaring difference is that they do not have a

very large distributor incentive like USANA does. If the same HealthPak product was manufactured at NBTY at

the same cost of $19.24 as it did with USANA, then NBTY would be able to sell it to their distributors for an

estimated $35.43 instead of USANA's $108 price tag.

By removing the focus of recruiting an endless chain of distributors (in what I believe is a massive pyramid

scheme) by greatly reducing or eliminating altogether the distributor incentives, product sold to USANA

distributors could be much more affordable and allow distributors to retail the product for a substantial profit

margin. In fact, if USANA distributors purchased the HealthPak for $35.43, they could resell it for a 100% profit

margin and it would still be much cheaper than the $108 USANA distributors currently pay.

This document shows all USANA products sold in the United States, the price USANA distributors pay for each

product from USANA (MultiLevel Marketing company), and the estimated price distributors could pay if the same

product was instead manufactured and distributed by NBTY (non-MultiLevel Marketing company).

Documents

USANA Price List vs NBTY Equivalent Price List Distributors Overcharged To Fund Pyra… · united states usana associate price list vs nbty equivalent price list usanawatchdog ©2015