Herbalife Nutrition Company

Student’s Name
Institutional Affiliation
 Herbalife
Nutrition Inc.
Company History
 Company history
 Herbalife was founded in 1980 by Mark Hughes to supply
nutritional and personal life items to the customers.
 Company mission and vision statement
Vision Statement
 “Changing people’s lives.”
Mission Statement
 “To change people’s lives by providing the best business
opportunity in direct selling and the best nutrition and weight-
management products in the world.”
 Today, the company serves customers across over 90 countries
of the world and has standing revenue of $4.4billion.
 It has over 8000 employees spread across the countries it serves
and supplies the customers with a wide variety of products that
 Product category overview

roduct Description Representative Products

Weight Healthy snacks, weight loss Formula 1, protein

Management accelerating products, meal powder, High protein bars

Over 45% of replacement products. and snacks, Total Control,

ales) Formula 2

nner Nutrition Supplements blended with Aloe concentrates, Garden

Over 40% of natural diet bosting 7, Niteworks and Liftoff.

ales) ingredients, minerals,

 Itenables the company to consult an assessment of its present
External Factor Evaluation
condition.
 Using EFE matrix, Herbalife can visualize and identify any
opportunity as well as identify external threats that can impact
negatively on the company.
 The company’s EFE weighted score is 3.26, indicating that is
stable enough and able to resist any external factors from
interfering with the company’s operations.
Comparative Profile Matrix
 Herbalife shareholders and management uses the tool to
identify the weaknesses and strengths of its competitors.
 CP matrix therefore helps by saving the company from
competition which is among the greatest threats.
 In addition, the company uses the findings through CP matrix
to enhance creativity and improve the company’s efficiency.
ortunities Weight, % Rating Weighted Score

EFE table
olidation of the Industry 11 4 0.44

wth of the demand to external markets 16 3 0.64

wth in Low-cost sector 8 4 0.32

ased weight and health concerns among consumers 12 4 0.48

ats

ced Margins 6 2 0.12

rnment regulation and oversight 5 4 0.20

ising inputs costs 11 4 0.44

ased taxation 8 2 0.16

ging consumer buying habits 15 3 0.45

Weighted Score 100 3.26

CPM Table
Herbalife GNC

Critical Success Factor Weight Rating Score Rating Score

Brand Recognition 0.23 3 0.69 1 0.23

Product integration 0.08 3 0.24 2 0.16

Product variety 0.21 4 0.84 2 0.42

Successful innovations 0.12 2 0.24 4 0.48

Market share 0.15 4 0.60 3 0.45

Skilled workforce 0.09 2 0.18 3 0.27

Financial position 0.12 1 0.12 2 0.12

 Internal Factor Evaluation
Herbalife GNC

Critical Success Weight Rating Score Rating Score

Factor

Brand Recognition 0.23 3 0.69 1 0.23

Product integration 0.08 3 0.24 2 0.16

Product variety 0.21 4 0.84 2 0.42

Successful 0.12 2 0.24 4 0.48

innovations

Market share 0.15 4 0.60 3 0.45

Skilled workforce 0.09 2 0.18 3 0.27

Company Financials
Ration Value

Asset Turnover ratio 1.79

Receivable Turnover 53.93

Inventory turnover 2.54

Gross margin 79.39%

Return on Investment 27.37%

Net Margin 8.22%

Operating margin 13.91%

Return on assets 11.38%

Asset Turnover 1.79%

SWOT Analysis
 SWOT Analysis technique is used to organize and
categorize all factors that are vital to company
success.
 SWOT analysis categorizes the vital elements into
Four Categories, Strengths, Weaknesses,
Opportunities, and Threats.
 Based on the identified factors in each category,
the company can adjust through pulling resources
to set better success-oriented strategies.
 Necessary adjustments under the SWOT analysis
matrix include changing to more efficient ways of
Strengths and Weaknesses
Strengths Weaknesses

Wider variety of quality products Poor stakeholder coordination

Strong brand and image and US Insufficient long-term financial

market domination management.

Product invention and innovativeness Limited expansion due to entrant

brands.

Larger US market share Little external market concentration.

Strong financial position More long-term liabilities.

High customer satisfaction levels Unsatisfactory market focuses

strategies.
Opportunities and Threats
Opportunities Threats

Rise in customer spending behaviors and Increasing numbers of entrant

economic growth companies in the industry hence

increased competition

Increase in potential markets due to New labor restrictions set by the

rising population and entry in government.

international markets

Increasing innovations of Herbalife in the American Market Isolation

industry.

The green drive by the united states and Increasing taxation rates for both local

other governments. and international markets.

Online sales boosts and increasing new Currency fluctuations.

clients.

Reduced costs of transportation. Increasing production costs, especially

the raw materials and labor.

Herbalife Nutrition Company BCG Matrix

CASH HIGH RLATIVE LOW RELATIVE MARKET

GENERATION MARKET SHARE SHARE

CASH USAGE

HIGH GROWTH Stars Question marks

RATE -Financial services -Local foods

-The Number 1 -The Number 4 brand

brand -The confectionery

-The Number 2

brand

LOW GROWTH Cash cows Dogs

RATE -Supplier -Plastic bags & synthetic

management fibre

-The Number 3 -The number 5 brand

 Herbalife
Company
Herbalife SPACE Matrix
Company SPACE Matrix
 Strategic Positioning and Action Evaluation matrix is a tool used to
provide an analysis of viable planning and making effective compan
decisions.
 The tool can be used to predict the company’s performance and gau
its satisfaction to the overall objectives.
 SPACE analysis reveals that the company has a massive return on
capital investment, with affordable products, giving it a competitive
advantage.
 Herbalife also satisfies customers with quality products and a wide
variety available at customer’s demand.
 Also, Herbalife US technology is advanced and supports its online
operations.
 The US is also politically stable and provides a proper business
Herbalife Nutrition IE Matrix
 Internal-External Matrix is used to analyze company
strategic positioning and conditions of work to enable
adequate business planning.
 It, therefore, compares the EFE and IFE matrix scores of the
company.
 As displayed in the first Phase, Herbalife’s EFE and IFE
scores are 3.26 and 2.80, respectively.
 From the IE matrix, Herbalife should focus on improving its
market penetration aggression.
 This will see the company increase its competitive
advantages over the leading competitors as well as improve
its returns.
Product-positioning map

 It is a technique that is used by companies to present their

products to the target markets best.
 The tool makes it easier for companies to identify potential
markets which they then display their products.
 Also, the technique helps companies identify means of
presenting their market so that they are found attractive in the
eyes of the consumers.
 Also, the technique serves a critical role in the realization of
the consumers’ preferences, aiding in research for better
quality, presentation, and identifying the weaknesses of the
competitors.
 Herbalife Nutrition Company
Herbalife Product Positioning Map
Mother Company Herbalife Private Limited Company

Market Sector Lifestyle and Retail

Category Drug retail

Selling tag “Nutrition for a better life”

USP Herbalife Ltd has an outstanding products delivery and effecting network marketing

approach.

Target Market Persons concerned about their health status and weight, both from middle and high

income category.

Market Positioning Herbalife Ltd is a global manufacturing and marketing company that deals in fitness

products, supplemental, energy and weight management products in numerous

countries with a varied market segments.

Competitors Nu Skin Enterprises, Amway Corporation, GNC and NBTY

Benefits of Product Positioning Map to
Herbalife Ltd
 PPM enables Herbalife to assess its weaknesses and strengths
and compare them against their competitor to turn them to
competitive advantages.
 Through PPM, Herbalife identifies the makeup of its brand in
the market and find strategies for building it further through
quality adjustment and proper packaging.
 Herbalife identifies potential market opportunities as it is made
easier by PPM, which analyzes the empty spaces in the
market.
 With the help of a product positioning map, Herbalife can
analyze the market, identify market maturity process shifts,
necessary for planning, and budgeting.
 Implementation and Assessment Plan
 It enables the company to assess its successes about its goals.
 Herbalife can use the technic to find the opportunities in the
market that can be explored to bring the company closer to
meeting its goals.
 It is through the I&A plan that Herbalife can gauge the extent
to which their mission of changing people’s lives has been
successful.
 Also, Herbalife can come up with strategies for accomplishing
their missions.
 Among the benefits that Herbalife realizes from
implementation and assessment plan are strategies for
improving the product quality, entering new markets and
bringing in more products to fully satisfy consumers’ demands