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Karl Loren |
January 22, 2002
Dear Karl,
I'm a student at the University of Phoenix doing and analytical research on the
multivitamin industry and the impact of the industry in our current economy as
well as individuals.
I must tell you that I find your web site to be the most incredibly resourceful site on the web so far.
I truly appreciate the fact that you care to
make the this kind of information available to your clients and the general
public and I hope your business continues to be extremely successful.
I would like your permission to use your website as a reference in my papers and
class presentations. I also have a few short question that I would really
appreciate it if you could answer...
1. How long have you been in the industry.
2. What motivated you to get involved in such a great industry.
3. Do you personally see year over year grown or recession in your business? if so what is the fluctuation?
4. What is the contact information for Horizon Laboratories or any other such company which manufacture private label vitamins (their phone number, website, or email is fine).
5. How does your business and industry
fluctuate with a booming or a lagging economy.
I thank you for taking the time to read this email and I hope I did not distract
or interrupt too much of your time, and thank you very much for taking the time
to put up such a great website, it will help hopefully help me get an A in this
class...
Ralph Pierre
Dear Ralph,
What a delightful request.
First, you may certainly refer to my web sites, or even copy any pages or material you wish for your paper.
All I need in the way of copyright acknowledgment is that you acknowledge any material that is truly mine. I have literally thousands of pages on my webs which are NOT my original work -- you may copy those showing their proper sources.
Let me suggest that I would like to do far more than answer your questions.
I propose to publish your incoming letter, and all subsequent correspondence on one of my web pages, and invite you to query me as you move along, and that you also respond to some of my questions about yourself, and your interest, and the School's interest in this subject.
I would be also pleased to publish your final report.
I often publish an incoming letter like this, making a rather public pledge to continue to publish even when I don't know the final outcome.
So, let me start with this response -- you may certainly use my materials.
And, ask your permission to publish your communications (and mine) without editorial change, on one of my web pages.
As quick background, I have 12 web sites and more than 15,000 pages.
Your question has come at a good time in my life -- when I am NOT thinking of retiring, but of compiling my thoughts on my own career and business, if only, and hopefully successfully, to guide my daughter, Maia Mulvena, who is taking over my business.
I look forward to these exchanges with you.
I am very willing to answer your questions in detail. But, first, let me find out a bit more about you??
Your course that calls for a report of this type?
Your major and life goals?
Your background and interest in "vitamins."
Karl Loren
Dear Ralph,
Let me start with answers to your original questions, by taking the first two questions.
1. How long have you been in the industry.
2. What motivated you to get involved in such a great industry.
You'll find that I spend more time than you might prefer in getting agreed--upon definitions.
What is the "industry" you are asking about?
Let me spell out the choices you have:
First, on the "manufacturing" side you have "raw material producers. It is not at all well known that there are an extremely small number of "actual manufacturers" of raw materials in the so-called "vitamin industry." Vitamin C, for instance, is a single substance. There are actually many varieties of Vitamin C, but still there are only a very small number of people who mix together various chemicals, minerals, etc., and combine them into "vitamins," such as Vitamin C. I have a rare glimpse into this world -- click here for a summary page with several other links. The information at the end of that link demonstrates that only a very few extremely large corporations actually "manufacture" vitamins. These manufacturers sell vitamins by the ton and hardly ever sell anything to final consumers. They would generally sell to "brokers."
Brokers in this "industry" would either be "stocking brokers" or "non-stocking brokers." The difference is self-explanatory. A Non-Stocking Broker would deal with large "vitamin packagers" and smaller brokers, and would arrange for large tonnage shipments from the actual manufacturer to a smaller broker or packager.
Stocking brokers would carry inventory of various vitamin substances and generally be ready to re-package these materials into drums and bags. They might buy several tons of Vitamin C, for instance, and be ready to repackage it into 100 pound drums, or 50 kilogram bags, or whatever is convenient for use. These "packaging" services would be extremely simple, nothing complex. For instance, these people would hardly ever "blend" various materials into a single powder.
Small brokers would usually buy small quantities, in package sizes that could be sold, as is, or even further broken down This is the end of this type of distribution within this industry. Next you have the people who blend several ingredients into a single formula -- usually called the "packagers." Sometimes they are called "laboratories."
The packagers? There are literally thousands of them around the United States. They typically put a mixture of ingredients into a blender, sometimes adding water, blending, drying, grinding the resulting "cake" into powder again, to still yet be mixed with other ingredients, finally to be poured into a capsule, pressed into a tablet, put into a gel cap, or otherwise put into a single dose size. They generally then put these capsules and tablets into bottles and apply a label. They would then ship them off to a "vitamin company."
The largest "vitamin companies" would do their own packaging. Solgar, Amway, literally hundreds of very large vitamin companies would often deal direct with the actual manufacturers for many materials, buy others from brokers, and do their own packaging.
Many thousands of small vitamin companies, like Vibrant Life, would come up with some formula, some mixture of various ingredients, go to a packaging company, ask for a quote, and then order, say 1000, or 10,000 bottles of that formula to be made. On a simple formula (say a mixture of Vitamin C with Calcium) the packager probably already has sufficient inventory to make this order without any special purchase of more supplies. On my most popular product, called Life Glow Plus, with 51 ingredients, the packager would almost never have all of them in stock, and generally wouldn't start any mixing until all the required ingredients are on hand. Sometimes one ingredient, or another, will be unavailable from his usual broker, or whatever, and it may well take 30 days to gather all the materials for one production run. These packagers hardly ever make a product for sale to the consuming public. They might make some simple "generic" formulas, such as "Vitamin B6" in a bottle of 100 tablets, etc., ready to put any label on that fits the contents. Thus, a really small "vitamin company" can buy as few as 12 or 100 bottles of each of several formulas, and put his own label on them -- look like one of the big guys!
Among the thousands of "vitamin companies" there would also be thousands of health food stores, selling vitamins and other "health items" to the general public. These health food stores typically sell many hundreds of different vitamin products, dozens of different brands. They may, and often do, get a line of simple and popular vitamins made with their label. They are just another "vitamin company" but do their marketing along with food and toothpaste, or whatever.
With this background, what would you say is "the industry?"
I have not even touched the process by which some particular formula gets designed.
Design is very seldom the province of the original raw material manufacturer. There would be an exception to this when and as some large manufacturer comes up with a patent on some new form of a vitamin. For instance, Vitamin E has been the subject of a patent by one company -- claiming that their Vitamin E was better than other Vitamin E. When some company does this they may decide to package their new product in retail size bottles, and try to sell them one way or the other. But, usually the design of a formula is NOT the province of these large manufacturers.
The brokers have no interest in designing formulas.
Packagers sometimes do design particular formulas, but more often they have consultants and chemists on staff who advise the customer of the packager (the "vitamin company") on what works well with what. One of the primary packagers for Vibrant Life is a company called Horizon Laboratories. (They do NOT want phone calls from consumers.) I might give them a preliminary formula for a new calcium product, and ask questions. Their staff expert might give me technical data about various ingredients, etc., but I would make the final decision.
So, usually it is the vitamin company that comes up with a formula. Frankly, most formulas are not unique. If you want to sell Vitamin B3, it will be quite difficult to claim that your B3 is much different from someone else's B3. So, the Vitamin world is very much in favor of combinations of ingredients. Then, you can say, "My B3 is better because I include Vitamin C with it!" The next guy will say, "Well B3 works better when combined with MSM, and MY B3 has MSM along with it."
Most of what might seem to be "unique vitamin formulation designed to enhance health" is nothing more than an attempt fo make your product APPEAR different in some way from the competition.
And, make no mistake about it, most formulas are copied. There is no way to patent any vitamin formula, or to deny anyone from taking your formula (right off the label on the bottle) and copying it exactly.
The most popular Vibrant Life product, Life Glow Plus, was "created" when I was very un-educated in vitamin formulation. i was selling an oral chelation formula made by a company called "Royal Nutrition." I suspect that they copied their formula from Dr. Kurt Donsbach. I took a bottle of the Royal Nutrition oral chelation formula to a packager and said, "Here is a formula that works fine. I want to make it better. How can I do that?"
The consultant at that packager suggested that I could increase the Vitamin E, and make a few other changes. I agreed with those changes, and then had the very first Vibrant Life formula -- our first oral chelation formula. Since those early days I have become very knowledgeable about vitamins, generally, and have designed several new formulas that were NOT copied from someone else.
But, there is not a lot of new creativity in formulas -- there is lots of creativity in marketing.
Now, with that background, I can answer the question about how long I've been in the "industry."
The only part of this industry I've been in is the "vitamin company" end of it -- that is where the formulas are created and the marketing that reaches the final consumer is created -- this is the most creative and fun part of this industry.
I can't imagine ME getting interested in the packaging activity, or the broker activity. The raw material manufacturing activity would require many millions of dollars of capital. Any bright kid can get into the "vitamin business" if he enters the part of that I did.
One more comment. There are literally hundreds of thousands of "distributors" of vitamins, mostly working with multi-level marketing companies. I don't consider them to "be" in the industry, although they might, indeed. A very small number of these people would have great knowledge of vitamins, while most of them have learned nothing more than their own company's promotional material. None of these people would have much to do with designing a formula or in arranging for purchase of inventory, or dealing with a packager. While I would not classify these people as in the industry, as I said, they probably would.
In any event, that is where I started.
I had sold a successful business (a janitorial cleaning business) and had sufficient money coming from the sale of my business that I didn't have to work for a couple years. I decided to pursue a career in public speaking, joining three different Toastmaster's Clubs, and going out to give speeches on various subjects (not usually health subjects) anywhere and any time I could. I also got myself invited on many radio shows, to talk about various subjects of interest to me -- but not much related to health.
About this time my mother died of an Anuryism -=- that is where an artery which is weak bursts OUTWARDS because of the blood pressure. The blood then leaks into the part of the body where the opening is. Sometimes these can be caught and repaired. In my mother's case she did not make it. As I spent time at her bed, before she died, I asked the surgeon, "What causes heart disease?"
His answer was typical back in those years. "No one knows the cause of heart disease." That was not a very satisfying answer, but I was not all that interested in pursuing that question just then.
A few weeks later, with this question still puzzling me, I bought a book on heart disease. I was just 50 years old, felt in the best of health, and had no possible personal concern for my own heart health.
This book said, in effect, "No one really knows the cause of heart disease."
I disliked that answer, and thought I might look for a better answer.
The book that changed my life was the Book, Bypassing Bypass, by Dr. Elmer Cranton. He described heart disease in terms I could understand, and he, of course, promoted intravenous chelation therapy as the solution.
I believed him, but there was certainly no thought that I could somehow become a doctor and offer IV chelation. That was, at the time, just interesting and useful information -- nothing I could use to get into a new career.
Then I realized that making money as a public speaker was not going to be easy, and came to see that if I used my public speaking skills to SELL something, I would find an easier path to profitable use of my speaking skills. Someone then invited me to an "opportunity" meeting for some MLM company. I heard this amazing story about oral chelation. I had heard that story earlier, at the National Health Federation, when Dr. Kurt Donsbach was talking, but although I was very intrigued by the formula I didn't see any way for me to get profitably involved.
This MLM company was Royal Nutrition -- still in business, and still selling oral chelation, as far as I know.
I organized a meeting of about 60 people to hear a lecture on heart disease. The president of the company gave the lecture.
I knew, with certainty, that he knew more than I did about heart disease, but that I could give a much better public speech than he could.
My launch into "this industry" marks from that date in about 1984 when I decided to learn a great deal about heart disease, oral chelation, and to start selling the oral chelation formula offered by Royal Nutrition.
I was extremely successful in giving my speeches -- many of them. And I was very successful in selling bottles of tablets, but I failed terribly in recruiting distributors to be in my group. Since MLM success is more based on recruiting than selling product, I finally realized that I had to get out of that particular company, but I wanted to stay in that business.
As I said, I simply took one of their bottles to a packager -- one that I found in the phone book -- and asked him for a quote on an "improved formula." We started with less than $3,000 to invest, got about 100 bottles made for us, and I continued giving the same speeches I had been giving, but now we were selling our own product.
That was the beginning of Vibrant Life. You could certainly say that it was s shoe-string start-up.
Dear Ralph,
Your third question was:
3. Do you personally see year over year grown or recession in your business? if so what is the fluctuation?
You see, immediately, that there are many different "businesses" within this one industry.
The fluctuations in our personal business had practically nothing to do with the economy or anything related to the health business. After we had started in our business I got interested in becoming a radio talk show host -- then spent thirty hours per week, live, on my own radio talk show. That was a glorious time for me, but I certainly did not do much work on "our business" during that time. So, the business suffered, even though we continued to sell vitamins.
Then, I got completely involved in yet another business -- I'll just call it researching, writing about, and promoting a financial service. It was moving toward grossing some millions of dollars annually, and seemed much more attractive than the hard work of selling vitamins. My wife, mostly, kept the vitamin business going, and I spent practically no time on it. Then, this other "financial service" business reached an end point, in about 1994, and I returned to the vitamin business full time.
The vitamin business had been mostly a traditional mail order business. I had been buying mailing lists, sending out bulk mail, responding to requests for information, and selling bottles of our oral chelation -- very modest sales. It was about 1995 when I decided to design a web site, and that began a sales boom that I think will not stop.
So, from about 1995, when our business operated pretty much in the current style, our annual sales have increased every year.
It is possible that recessions in general, or in the health industry, particularly, might have affected us, but I have never agreed that external influence could possibly affect our success.
There are just too many millions of people dieing needlessly, from heart disease. I know I have the solution to those millinos of deaths. Therefore my only job is to constantly look for ways to get my message before more and more people.
We are greatly aided, too, by the fact that my formula works so well that our customers typically become life-time users. We still have many customers who started buying our formula in 1984! Some 17 years later they are still buying.
We have many people who were diagnosed as needing bypass surgery, took my stuff, and then didn't need the surgery. Just a few of these stories, when true and valid, spread the word very convincingly.
So, we hardly ever lose a customer. People start buying our oral chelation formula and then continue to buy -- it is a very satisfying type of business that is that successful.
It is still a slow growth because people generally only buy my formula when they have become convinced that the great mass of medical authority is WRONG, and that me, Karl Loren, not a doctor, is right about heart disease.
In this sense I have long left the "vitamin business" far behind. I don't even consider that I am IN that business, but rather I am in the "truth and education" business.
I see and report on the lies spread by the medical establishment. People agree with me on an increasing basis. I see and report on a remedy that is far cheaper than drugs and surgery. We succeed because we speak the truth.
So, I'm really in the truth business.
I have a mission to spread this truth. That is more important to me than "selling vitamins," but it is the sales of these vitamins that allows me to pursue my true goal -- truth on heart disease revealed.
In this grand sense, I am not part of business cycles or recession. The only possible limit on my growth is my own ability to get my story out to more people. The product has proven itself -- and I don't have to worry about whether or not it "works."
It does work.
All I have to do is worry about reaching more people. I don't feel that MY business is subject to any fluctuations in the "vitamin industry."
However, I can see where someone who is merely selling bottles of Vitamin C might well be very much the adverse effect of adverse economic conditions.
My vitamins are expensive enough that they don't normally fit into the usual "vitamin budget" someone might have. They are going to buy my vitamins, generally, only when they have made the decision to spend much more on vitamins than they ever may have thought they would.
In this sense, also, I have no competition.
Even though anyone COULD copy my formula, no one has done that. Instead they copy it in part, cheapen it, and come out with a cheaper "thing" that just doesn't do the job. There may be consumers who don't know about my formula, and who buy these fraudulent products, but when they finally find my web site, they typically drop the other, cheaper, product and come to Vibrant Life.
So, since my business is NOT the vitamin business, but rather the "TRUTH" business, and since there is a great shortage of truth in the marketplace, and since I have some truth that deals with the number one killer in our society, I can't see any limit to our growth.
Well, there may be some obstacles ahead, but I'll deal with those later.
Karl
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