Entering the Home Stretch of a Remarkable Year
The majority (56%) of companies within our domestic tracking set of private direct selling companies again experienced sequential growth when comparing October revenue to September. This is now seven out of the last eight months that the majority of companies we are tracking have increased revenue on a sequential basis.
Referring to the year 2020 as remarkable feels like a huge understatement. Entering the year, domestic direct selling was, as a whole, stagnant from a growth perspective. Ten months and a global pandemic later, the industry is experiencing a renaissance that goes beyond the most optimistic expectations. In addition to the private companies we are tracking, one only has to look to the data coming out of the public companies within the industry. For example, last night Herbalife released financial results that included 55% year-over-year revenue growth in its North American segment. In addition, Tupperware reported third-quarter results including 42% year-over-year growth in North America and Nu Skin reported year-over-year growth of 83% in its reporting segment that includes North America. These are “remarkable” numbers.
Considering all of the evidence available, we have never been more comfortable with our prediction for record domestic direct selling revenue in 2020. Based on our internal analysis, we project domestic revenue growth somewhere in the ~7% range, which would place 2020 revenue around $38.7 billion. This would represent an increase of $2.5 billion from the record $36.2 billion achieved in 2016.
As we look forward to the next several months, we expect a relatively strong close to the year as compared to previous years, however, it is likely the number of companies growing revenue sequentially will decline as we enter the holiday season. In January we expect to provide you with 2020 vs 2019 revenue data, which will show the incredible growth that the companies amongst our tracking set have experienced this year. We also expect 2021 to be a strong year for the industry as there does not appear to be any reason for the momentum to stop. However, 2020 will be hard to beat.
CEO & Owner | SUCCESS Partners