Usana Health Sciences (NASDAQ: USNA) CFO Gil Fuller is one of the great wordsmiths of our time. When asked about whether he is a CPA during the company's analyst presentation on Thursday, Fuller joked that he needed to ask Bill Clinton's attorney about the definition of is. But the highlight of the presentation came earlier when Fuller explained the company's "business opportunity" by saying that "direct selling implies a volunteer army..."
Well, Gil Fuller's absolutely right. Usana's army of associates are volunteers, in the sense that they don't make any money. According to Barry Minkow's initial report on USANA, 85% of distributors lose money, with no less than 74% failing within a 12-month time period.
In addition, the average payment to the bottom 99% of Usana salespeople is about $5.66 a week, before product purchases, taxes and all other business expenses. Given that Usana products appear to be hopelessly overpriced compared to the competition, being a Usana distributor is a losing venture for all but a tiny percentage of those who give it a try. 3% of the company's distributors earn 70% of the commissions.
So congratulations to Gil Fuller. Even if he can't seem to figure out the definition of is, he has made George Orwell proud with his characterization of Usana associates as volunteers. Next time you hear a complaint, just remember: They're not losing money! They're volunteers!
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Reader Comments (Page 1 of 2)
6-15-2007 @ 11:10PM
Michael Gurry said...
If you think USANA products are hopelessly overpriced then what "competition" are you referring to? If you mean products like Centrum that sell for $5 or $6 a bottle then that is not a fair comparison with the USANA Essentials, like comparing a Ford Escort with a Rolls Royce. Just compare the formulas and what you get for your money in terms. Now if you want a legitimate comparison, then read the Guide To Nutritional Supplements by Lyle McWilliam in which 7 nutrition experts gave their opinions of products that provide optimal daily vitamin doseages. There are some products on the retail market that do offer strong competition to the Essentials and these were also rated highly in the Comparative Guide. The Essentials was rated #1, and the Autoship price is $39.95US and RRP is $53.15US and if your contention is that this is exhorbitant and way above any reasonable price point then please consider the following:
eg. the #2 product, Douglas Laboratories, sells for $57.10 in medical offices and the #3 product's web site, Vitamin Research Products, shows that it sells for $46.95. Therefore when you compare products of a similar quality, based on the opinion of 7 nutrional science experts whose opinions make up the "blended average" in the Comparative Guide, the Essentials pricing is very fair isn't it? If customers want the convenience of the Healthpak100 with six different tablets in each blister pack for their AM and PM doses that's their choice to buy and so they pay more for it.
6-16-2007 @ 12:17AM
Michael Gurry said...
Corrections to my blog - "...what you get for your money in terms of the range and potency of the nutrients, eg. 20IU of Vit E c/w 400IU."
"...read the Comparative Guide to Nutritional Supplements"
6-16-2007 @ 4:12PM
john lichtenstein said...
The Comparative Guide is written by someone with ties to USANA. A BC politician at that.
6-18-2007 @ 11:06AM
Nathalie said...
Guide To Nutritional Supplements by Lyle McWilliam is made by Usana so it has absolutly no scientific value
6-18-2007 @ 9:56PM
Michael Gurry said...
The Comparative Guide is NOT a USANA publication. These are the facts - Lyle MacWilliam was a former Canadian MP and member of the LA for BC who was approached by Canada's Federal Health Minister to help develop a new regulatory framework for natural health products to determine safe, effective and high quality nutritional supplements. The Comparative Guide is a result of his research to find real quality among the 100's of products available to the public. The rank order is based largely on the independent opinion of 7 nutritional scientists that make up the blended standard. If you think Lyle's 14 point criteria is unsatisfactory then please specify where he is in error. Obviously since USANA is ranked #1 then it suits their marketing to use this book as evidence of a quality product but the book is not sold by USANA. I'm certain that if any other co. was ranked in the top order they would be only too willing to show it as well.
6-20-2007 @ 9:40AM
J. Wilks said...
Michael Gurry: how much do you make from USANA?
6-20-2007 @ 12:03PM
Jorge Garcia said...
The Guide To Nutritional Supplements absolutely is a USANA marketing ploy/tool. I was in USANA for years, rubbed shoulders with Lyle McWilliam at USANA conventions. They are all in bed together and the book is a joke. In fact Lyle McWilliam and the the Guide we key in me seeing the truth about USANA and how much lack of integrity there really is with them. They put on a warm fuzzy show, but if you peel back the layers...scary. USANA distributors--- I say WAKE UP and stop throwing your money, time, and family life away for a "dream".
6-21-2007 @ 6:59PM
Jorge Garcia said...
Michael Gurry is an "Achiever" with USANA which means he does NOT MAKE JACK. An "Achiever" cannot even cover their product purchases or marketing.
6-22-2007 @ 10:21AM
Michael Gurry said...
Well Jorge thanks for your kind words and yes I am an Achiever but you seem to have forgotten that means I am earning far more than my monthly autoship costs to maintain my commissions. If you had been smarter you would have stayed in Usana and kept using and recommending the finest health products on the planet. If you think the Comparative Guide is not a credible reference then which companies and products have been mis-represented? What is wrong with the comparative criteria that Lyle has used? Please explain how this guide should have been researched and presented if you are such an expert in this area.
6-22-2007 @ 6:40PM
Jorge Garcia said...
Michael, it is mathimatically impossible for an Achiever to cover the expenses of a USANA business which include a $100 per month service fee just to stay in the game. You know this and I know this. It is part of the deception. As for Lyle Mac's book, he is part of USANA and it is a marketing piece not science. nuff said.
6-26-2007 @ 12:09PM
Jorge Garcia said...
Regardless, Michael, the better you are doing in USANA then the more you are part of the pyramid scheme. I know you are using the line "recommending the finest health products" but that is part of the cult-like speak of USANA associates the world over. It is a recruting game plain and simple. If you were retailing products to end-customers primarily, then we could get to the table and have a real conversation. But as it stands, USANA is all about recruiting for Pro Packs, "getting people in" etc. I hope you can snap out of it before you are too far down the path of deception. Because that is who I feel the worst for--the uplines that actually believe in what they are doing. How sad is THAT?
6-23-2007 @ 2:03PM
Michael Gurry said...
Jorge, I'm beginning to think you weren't in Usana at all because you don't have a clue about the Achiever payout. The Achiever level cheque is $660AUD per week and my autoship to qualify is approx. $240AUD per month so I think that means I'm well ahead plus the profit I make on retail customers of which I have quite a number every month. I am quite happy with those figures and it is a lot better than a previous MLM co. I was in many yrs ago and our comp. plan has assisted my progress. Contrary to your assumption of how all associates operate, I and my team members do not try to recruit everyone for Pro packs because it can lead to early attrition. I do focus on product sales first and distributors second because that keeps people on the products and in the business which is why we are called distributors. What a pity you did not feel the benefits of these products as I have or see the benefits in other people because then you would appreciate how good they are and that it is insulting to refer to us as being involved in a cult. If you were in Usana you must have had a very sad Usana experience, maybe your sponsor over-hyped the opportunity and now you want to go on the attack. Neither I nor my team members have to snap out of anything so you don't have to worry about trying to save us and don't assume that all Usana associates treat it as a recruiting game. Unfortunately this recruiting approach is all too common with many people in various MLM co's and it does no service to our cause in gaining public respect.
6-23-2007 @ 2:03PM
Jorge Garcia said...
You do make it sound so good Michael, but alas, that is the way MLMers are. Very slick in their presentation when it really all comes down to greed and deception. But to say that an Achiever makes 660 a week is HOGWASH. First of all, there is no gaurenteed income in USANA as it is based on "sales" per week. You are continuing USANA's misrepresentation by publishing these made up numbers in a public forum. Next will you try to show me your check?
6-23-2007 @ 7:42PM
Michael Gurry said...
I can see you are very bitter and do not wish to believe anything I say so I feel very sorry for you so this discussion is pointless. You probably see no value in supplements and you obviously don't understand the biochemistry science behind the Comparative Guide and that is understandable if you have not studied tertiary science. To say it has no scientific value is like saying Einstein's Theory of Relativity is hogwash simply because you don't understand it. By the way, if you know anything about money you will see those figures are in Australian Dollars because that is how I'm paid but you probably won't believe that either, so that is all.
6-25-2007 @ 10:41AM
Jorge Garcia said...
Mr. Gurry, no matter how you slice it, the author of
the Comparative Guide is part of USANA so the fact that he says they are the best is silly. In the US, people like independent parties to rank products. Further more, your income claims on this board or untrue, irresponsible, deceptive. But why should be surprised when a member of USANA acts in such away. To all the world---STAY AWAY FROM USANA.
6-26-2007 @ 9:59PM
Michael Gurry said...
USANA Founder Dr. Myron Wentz was honored two days ago on June 25, at a special ceremony in Jerusalem with the Albert Einstein Award for Outstanding Achievement in the Life Sciences.
The Albert Einstein Award, given by Global Capital Associates, salutes leaders whose vision and commitment have contributed to the critical advancement of vital life-saving and life-enhancing technology to benefit mankind. Dr. Wentz received the award in recognition of his contributions to nutritional science, as well as his many humanitarian endeavors.
“I am honored and humbled to receive an award that bears the name of Albert Einstein,” Dr. Wentz said. “As both an extraordinary scientist and dedicated humanitarian, he serves as a great inspiration for my life’s work, helping people lead healthier lives through nutritional science.”
The USANA family wishes to congratulate Dr. Wentz for this well-deserved honor.
6-27-2007 @ 1:52PM
Jorge Garcia said...
I find it very interesting that Global Capital Associates would honor Myron Wentz. Global Capital Associates is connected to Aish Hatorah an orthadox outreach/education program. I wonder if those giving the award know that many of the USANA products descreetly contain PORK products. Even the Essentials which do not use gel caps contain PORK. It took many back and forth emails for the USANA "scientists" to finally admit this. DO YOUR RESEARCH as there is much more than meets the eye with this company. All that glitters is not gold with USANA and without fail, people are losing money in this silly MLM scheme.
6-27-2007 @ 2:40PM
Jorge Garcia said...
Also, I wonder if the pork was removed from the Essential vitamins that are now being peddled in Malaysia. Obviously there are many in Malaysia that do not eat pork. Another case of non-disclosure by USANA? Not sure but it would be interesting to know.
7-17-2007 @ 1:31AM
Terri Hamel said...
Don't let someone's glowing cynicism rob you of your dreams. Scratch beneath the surface and you'll find Fools' Gold. I'm a colleague of Michael Gurian. He's ethical and real, and what he says is trustworthy and true. Did you know that Dr. Wentz has been building hospitals in Africa? The darkness always seeks to extinguish the light. A word to the wise is sufficient...
Terri
7-19-2007 @ 6:09PM
John said...
Has anyone done any research into where this award comes from? The GCA holds seminars to connect over seas business to those in Isreal and charges for attendance. People pay $18,500 to attend this seminar and while there's suppossed to be 50 spots open, only 17 people attended this year (Excluding the 4 Chairs from the GCA). Of those 17 who attended 9 got awards. Looks to me like this is the sort of recognition you can buy. Previous years have had as many as 23 winners, so I sincerely question the worth of the GCA's awards. Looks more like a cheap (or should I say $18,500) publicity stunt. If this is such a big deal, why such low attendance?