Nu Skin prepares for Russia entry
at the beginning of next year, and has tapped one of its most
successful European executives to lead the new venture.
Mikael Linder has been plucked from his role as general manager in Scandinavia, which he has held since 2001. Over this time, the revenue in that region has more than doubled to around €7 million, representing 50 percent of the total revenue in Europe.
Of Linder, the company said: "He has been key to the growth of our Scandinavian markets and is the right person to lead and manage the business in Russia. He has the Company's complete trust and confidence."
Over the next few months he will be setting up the support and service function, and it is believed that around 40 staff will be employed at the Moscow base.
Although the cost of manufacturing is lower in Russia and some international companies have opted to make products destined for the market actually within the country, Nu Skin is not believed to be going that route in the short time - although it has not ruled out local manufacturing once operations are running at full speed.
Between 2002 and 2003 the Russian market recorded value growth of 14.3 per cent in cosmetics and toiletries sales, with skin care showing the strongest value increase at 30 per cent, according to a report from Euromonitor International.
Right across the market, growth has been underpinned by the stabilisation of the Russian economy, which has encouraged foreign investment and bolstered consumer spending.
Overall, however, Nu Skin's personal care business has not been performing at its peak. In second quarter 2005, revenue from the division fell 10 per cent compared to prior-year results, to $127.9 million - something the company said was directly attributed to the emphasis placed on the Pharmanex dietary supplement division.
Like all direct marketers operating in the region, Nu Skin is also expecting great things of its Asian operations in the coming period, due to the lifting of China's ban on direct selling.