Reliv

COMPANY OVERVIEW

History

Reliv International evolved out of another company in a completely different line of business, American Life Investors, Inc. Founded in 1985, the company sold prepaid legal plans. It was so successful that its co-founder, Robert L. Montgomery, was able to retire as a millionaire at the age of 38. However, not long after retiring Montgomery met microbiologist Theodore P. Kalgoris and began using a nutritional supplement Kalgoris had developed. In 1987 Montgomery was diagnosed with a brain tumor and after a successful surgery, was able to recover in less than half the time expected by his doctors. Montgomery and his family attributed the remarkable cure to his use of Kalgoris' nutritional supplement and once he was healthy Montgomery set out to bring Kalgoris' formula to the masses (now called Relic Classic).

The result was a make-over of Montgomery's old insurance business, which was reincorporated as Reliv Inc. in 1988. In 1991, the company decided to branch out internationally and formed a joint venture in Australia which resulted in the founding of Reliv Australia Pty, Ltd. In 1992, Reliv expanded further, first to New Zealand then to Canada. The company then launched subsidiaries in Mexico and the United Kingdom in 1993 and 1995, respectively. Reflecting its worldwide presence, the firm changed its name to Reliv International, Inc. in 1992.

In March of 1993 the company began trading on the American Stock Exchange's Emerging Company Marketplace. In August of 1993 the company opened its new state-of-the-art manufacturing facility in Chesterfield, MO. This $1 million dollar facility would have allowed Reliv to produce and package its own products; however, it was completely destroyed just 2 months later when the Missouri River flooded. In 1996, the company rebuilt its damaged facilities in Chesterfield and moved its shares from the AMEX to the NASDAQ.

2000 was a successful year for Reliv in regards to its products. The company launched a major product development called "Reliv 2000", which resulted in 4 new products. In the same year, Reliv entered the anti-aging market with a new line of skincare products. With the help of these new products, Reliv's stock increased some 4000 percent in 2002. Just recently in 2007, Reliv introduced its Simplicity Weight Loss System in which the company hopes will be as successful as "Reliv 2000".

Current Status

Currently, Reliv International generates sales through distributor networks in Australia, Austria, Canada, Germany, Ireland, Malaysia, Mexico, the Netherlands, New Zealand, the Philippines, Singapore, the United Kingdom and the United States. The majority of sales are made through domestic distributors. As of December 31, 2006, Reliv's network consisted of approximately 64,960 distributors - 52,880 in the United States and 12,080 across international markets. The company currently employs 246 full-time employees.

Product Mix

Reliv International, Inc. is a developer, manufacturer, and marketer of a line of nutritional supplements addressing basic nutrition, specific wellness needs, weight management, and sports nutrition. All nutritional products are in a powder form, which Reliv believes allows them to differentiate their product from their competitors'. The company currently offers 15 nutritional supplements as well as a line of 7 skin care products.

* Basic Nutrition Supplements - Represents Reliv International's core line of nutritional supplements, which accounted for 62.8% of net sales in 2006, and includes four products: Reliv Classic, Reliv NOW, NOW for Kids and Reliv Delight. The company's four basic nutrition supplements provide consumers with a broad spectrum of essential daily nutrients.

* Specific Wellness Supplements - Includes five compounds that target certain conditions, promote health, and are designed to slow down the effects of the aging process. The Specific Wellness Supplements include ReversAge, SoySentials, CardioSentials, Arthaffect and FibRestore.

* Weight Management Supplements - Combine advanced weight loss promoting complexes with scientifically balanced nutrition and health enhancing soy protein. These products include Cellebrate, the Simplicity Weightloss System, which was introduced in February 2007, and includes Slimplicity meal replacement and Slimplicity accelerator capsules, and Reliv Ultrim-Plus, which is no longer available in the United States due to the introduction of the Slimplicity products. The company expects Slimplicity to eventually replace Reliv Ultrim-Plus in all of their markets as it is introduced. It was just recently introduced in Europe in January 2008. Currently Reliv's weight management products account for roughly 10% of sales.

* Sports Nutrition Supplements - Two supplements, Innergize! and ProVantage, contain a balance of nutrients scientifically designed to improve athletic performance and endurance, as well as muscle recovery and repair.

* Skin Care Products - Reliv's ReversAge skin care product line combines advancements in youth-promoting nutrients with a delivery system designed to enhance the way those nutrients are absorbed and utilized by the skin. The ReversAge skin care line includes: Balanced Cleansing Gel, Total Body Renewal Lotion, Smooth and Lift Serum, Daily Skin Defense, Eye Renewal Cream, Nightly Skin Restore and Rich Cleansing Bar. Currently the skin care line comprises only a very small percent of Reliv's overall sales. The company states that they have put minimal focus on this line and do not foresee their focus increasing in the near future, as they will continue to direct their concentration on their nutritional supplements.

Distribution

Reliv's motto is nutrition made simple - life made rich. It was founded in 1988 with two goals in mind; 1) offer the best balanced nutrition product available on the market 2) offer the best business opportunity available. Independent distributors are critical to Reliv's success. The start-up costs are low for new distributors in what Reliv calls a high demand industry. The Reliv opportunity for its independent distributors is a home-based business with the potential for unlimited income and the freedom to spend more time with family. Reliv offers five different ways to earn income. Their five income avenues include 1) Retail Income - products you sell to customers 2) Wholesale Income - products sold through your Personal Group i.e. a new distributor you sponsor 3) Overrides - residual income