Sales And Marketing Plan - Herbalife

PROMOTIONS AND VACATIONSActive Supervisor*All Fully Qualified Supervisors who achieve 2,500Total Volume Points in 3 consecutive months willreceive an Active Supervisor pin and certificateof achievement.Month 12,500TVMonth 22,500TVMonth 32,500TVActive World TeamIn a consecutive 4-6 month period, achieve: 2,500 Total Volume Points in four consecutive months, and 10,000 Total Volume Points in one Volume Month OR 5,000 Total Volume Points in 2 months and 500 Royalty points in one Volume Month.What you earn: Active World Team pin and certificate Onstage recognition at the event in your region A US 500 Special Bonus for first-time non-TAB Team AWT qualifiers Free one-year BizWorks subscription for first-time non-TAB Team AWT qualifiersVacations*Every year, you have the opportunity to qualify for a fantastic Herbalife Nutrition Vacation. You’ll join your fellow Members fromaround the region for an exclusive break in a beautiful location where you can relax and have fun. Members always say it’stheir best holiday of the year! See your local flyer for the details.*Qualification varies by country.All US/PR volume must be Documented Volume.09

UNDERSTANDING VOLUMEWe use the term volume extensively. Volume is a key element inthe Sales and Marketing Plan and is the basis for qualifying andworking your way to higher levels.Each Herbalife Nutrition product has a Volume Point valueassigned to it (see order forms and price lists for exact information).Official Herbalife Nutrition Member Packs (HMPs), literature itemsand sales tools do not count as volume. As you order products,you accumulate Volume Points that are applicable to the productsordered. These accumulated Volume Points become your salesproduction and are used for purposes of qualifications andbenefits.Volume is assigned to you in various ways depending on whopurchased the product, their status and discount, your own statusand other factors of the Herbalife Nutrition Sales and MarketingPlan. Volume is calculated on the accumulated Volume Point valueof products ordered in a Volume Month.Explanation of Volume MonthDefinition of Volume MonthVolume is assigned to and accumulated by a Member on aVolume Month basis. The Volume Month begins on the firstbusiness day of the month and ends on the last business day ofthe month. If the last day falls on a weekend, the Volume Monthwill be extended to Monday. Likewise, if the last day of the monthis considered a holiday, the month may be extended to the firstbusiness day after the holiday. Herbalife Nutrition reserves theright to modify the Volume Month as it deems appropriate.Determination of Volume MonthVolume is assigned to the Volume Month in which the order isboth placed and full payment is received by Herbalife Nutrition.Add-On VolumeThe following conditions must be met for an order to be acceptedas Add-On volume:1.2.3.Personally Purchased Volume is the volume on orders purchaseddirectly from Herbalife Nutrition using your Identification Number.Downline Volume (DLV)Downline Volume is achieved on orders placed by yournon‑Supervisor downline directly from Herbalife Nutrition.Downline Volume ExamplePurchases/Discount %Downline VolumeA Supervisor2,500 Volume Points@ 50% discount*Refer to footnoteB SeniorConsultant500 Volume Points@ 35% Discount 900 Volume Points(C and D’s Volume)C SeniorConsultant500 Volume Points@ 35% Discount 400 Volume Points(D’s Volume)D Member400 Volume Points@ 25% Discount 0Personal Volume (PV)As a Fully Qualified Supervisor, Personal Volume is achieved fromyour own purchases and purchases made by your non-Supervisordownline, down to your first Fully Qualified Supervisor.All product must be purchased directly from Herbalife Nutritionand may not be purchased from an upline Supervisor or otherMembers.Therefore, if you are a Fully Qualified Supervisor, all of your ownorders purchased at 50% as well as all orders purchased byyour downline Members, Senior Consultants, Success Buildersand Qualified Producers at 25% to 42% discount count as yourPersonal Volume.Order must be placed no later than the designated last orderday of a Volume MonthFull payment must be made, or initiated, on the same lastorder day of the month. For example if payment is mailed,the postmark must be stamped the designated last order dayof a volume month. If the payment is a wire transfer, directdeposit or other bank transaction, then it must be initiatedon the last order day of a volume month.Full payment must be received by Herbalife Nutrition no laterthan the 5th day of the following month. If the 5th of themonth falls on a weekend or a holiday, then the paymentmust be received by the last business day before the 5th. Iffor any reason, a payment is not accepted or received, thenthe order will be canceled and the Volume will not be applied.There are a number of ways volume is assigned in the HerbalifeNutrition Sales and Marketing Plan. The following definitions andexamples illustrate these:10Personally Purchased Volume (PPV)Personal Volume ExamplePurchases/Discount %Personal VolumeA Supervisor1,000 PersonalVolume Points B,C and D’s Volume 2,800 PersonalVolumeB SuccessBuilder1,100 Volume Points@ 42% Discount C and D’s Volume 1,800 PersonalVolumeC SeniorConsultant300 Volume Points@ 35% Discount D’s Volume 700 PersonalvolumeD Member400 Volume Points@ 25% Discount 400 PersonalVolume*For Fully Qualified Supervisors, Downline Volume is counted towards Personal Volume or Group Volume.All US/PR Volume must be Documented Volume.

UNDERSTANDING VOLUMEGroup Volume (GV)Total Volume (TV)Group Volume is the volume on orders purchased at a temporary50% discount by Qualifying Supervisor(s) during the qualifyingmonth.Total Volume is the sum of Personal Volume plus GroupVolume. (See “Group Volume Example” for Supervisor A’sTotal Volume.) Total Volume is the factor on which somequalifications are based.This Temporary 50% Volume is accumulated as Personal Volumefor the Qualifying Supervisor who is purchasing, and it is GroupVolume for the first upline Fully Qualified Supervisor. As a FullyQualified Supervisor you will earn Royalty Overrides on GroupVolume if all other Royalty Override requirements are met. (Refer tothe “Fully Qualified Supervisor” and “Qualifying Supervisor” sectionsof this book for complete details.)Supervisor A2500 PPVEncumbered VolumeEncumbered Volume is volume being used by your downline toqualify for Supervisor.Unencumbered VolumeUnencumbered Volume is volume not being used forSupervisor qualifications by your downline.Supervisor A’s Personal Volume,Group Volume, Total Volume@50%PersonalVolumeQualifyingSupervisor B1000 PPV@temp 50%Member C4000 PPV@42%The example that follows illustrates the use of Encumbered andUnencumbered Volume for each of the Members.2500 Volume Pointsfrom A’s PPV 4000vp from C’sPPV@42% 6500GroupVolume1000vp from B’sPPV @ Temp 50%TotalVolumePersonal Volume Group Volume 7500vpEncumbered and Unencumbered VolumeOrganizational Volume (OV)ASupervisor2,500 TotalVolume Points B and C’s Volume2,500 Unencumberedfor A 5,000 Encumberedfor ABQualifyingSupervisor1,000 TotalVolume Points C’s Volume1,000 Unencumberedfor B 4,000 Encumberedfor BCQualifyingSupervisor4,000 AccumulatedTotal Volume Points 4,000 Unencumberedfor COrganizational Volume is the accumulated Volume amounton which a Supervisor earns Royalty Overrides. (See the“Organizational Volume Example” that follows.)*Group Volume on 3rd level Supervisor does not count towardsyour Organizational Volume.Organizational VolumeExample:YOUOrganizational Volume : 30,000Royalty Overrides Point : 1,500at least 2,500 TVSUPERVISORSUPERVISOR3,000 TVSUPERVISOR SUPERVISOR2,500 TV2,000 TVMEMBER2,000 TVMEMBERSUPERVISOR SUPERVISOR3,000 PV2,500 PVSUPERVISOR3,000 TVSUPERVISOR2,500 PVSUPERVISOR2,500 TVSUPERVISOR SUPERVISOR3,000 PV4,000 PVLevel 1(5,000 TV)Level 2(10,000 TV)Level 3*(15,000 PV)All US/PR Volume must be Documented Volume.11

INCOME OPPORTUNITYYou may be surprised to learn that retail sales are not the only way to earn profit. There are other ways to increase yourearnings, too.01PROFITON RETAIL0225% to 50%Profit on Retail explained:As an Herbalife Nutrition Independent Member,you may immediately begin to purchase at aWholesale discount of 25% to 50%* on theEarn Base value of the products. As yourVolume increases, your discount will increaseup to a maximum of 50%, when you qualify as aSupervisor. When you sell products to customersyou can earn an immediate Retail Profit of 25%to 50%. Retail profit is the difference between thediscounted* price that you pay and the retail pricepaid by your customer for the products.0312ROYALTIESUp to 5% on 3 levels ofyour OrganizationPROFIT ONWHOLESALEUp to 25%Profit on Wholesale explained:(Commissions)In addition to Retail Profit, as an HerbalifeNutrition Independent Member, you can alsoearn Wholesale Profit on the product salesmade by your downline (Members who you havesponsored). Your Wholesale Profit, also knownas Commissions, are the difference betweenthe discounted price you pay for products andthe discounted price your First Level DownlineMembers pay for product. You are eligible toqualify to earn Commissions once you achieveSenior Consultant Level (35%).04PRODUCTIONBONUS2% to 7% bonus on theOrganizational productionRoyalties explained:Production Bonus explained:When you are a Supervisor and have FullyQualified or Qualifying Supervisors in your firstthree downline levels, you may then be ableto earn Royalty Overrides of 1% to 5% of yourOrganizational Volume.Once you have qualified to the TAB Team, youhave the potential to also earn a ProductionBonus. You can qualify to earn between 2% and7% on your Downline Organizational Volume. Youmust be qualified to earn 5% Royalty Overrides inorder to be eligible to also earn Production Bonus.*Discount % is calculated off the Earn Base of the products and may not be equivalent to 25-50% off of the Retail Price.All US/PR Volume must be Documented Volume

MEMBER BENEFITSRetail ProfitRetail Profit ExampleAs a Member, you may purchase Herbalife Nutrition products at awholesale discount of 25% to 50% on the Earn Base value. As yourvolume increases, this discount will increase up to a maximum of50% when you qualify as a Supervisor. You earn an immediateRetail Profit when you sell these products to customers. Thedifference between the discounted product price paid by you andthe retail price paid by your customer is your Retail DiscountedAmountYourCostYour RetailProfit B x 25%Discount A-C A-D 25 85 25 110Wholesale Profit (Commissions)In addition to Retail Profit, as an Herbalife Nutrition IndependentMember, you can earn Wholesale Profit on products purchased byyour downline. Your Wholesale Profit, also called Commissions, isthe difference between the discounted price you pay for productsand the discounted price paid by your downline.When your downline purchase their product from Herbalife Nutrition,Herbalife Nutrition pays the Wholesale Profit to the eligible SeniorConsultant, Qualified Producer, Qualifying Supervisor and/orFully Qualified Supervisor based on their respective final discountpercentage achieved at the end of the month. This payment is madeduring the monthly Royalty Override process. 100Wholesale Profit (Commissions) Example(A)(B)(C)(D)(E)RetailEarnBaseYour Cost(at 50%)YourDownline’sCostYourWholesaleProfit A-(Bx 50%discount) A(B x 25%discount)D-C 60 85 25 110 100Split Commission Example(A)(B)(C)TotalRetailEarnBaseDiscount Level(Off Earn Base)(D)(E)YourYourDownline's Downline’sCostDiscountedAmount BxC A-D(F)(G)Split CommissionsTo the QualifiedProducer(at 42%, Cost 68)To the Supervisor(at 50%, Cost 60) E - 68 E - 60 - F 110 100Member - 25% 25 85 17 8 110 100Member - 25% 25 85No Qualified Producer 25 110 100Senior Consultant - 35% 35 75 7 8 110 100Senior Consultant - 35% 35 75No Qualified Producer t35%Member25%8%7%Senior ConsultantImprove Your Profits With the Discount ScaleAs you and your non-Supervisor Downline sell more Herbalife Nutrition products,your Total Volume increases and you may reach the next level of Senior Consultant.As such, you become eligible to purchase products at a 35% or 42% discount off theEarn Base, giving you a greater profit margin.Discount Scale10%As a Member you may purchase at a 25% discount on all orders until you becomeeligible for a higher discount by achieving the Senior Consultant level. Thereafter,your discount on purchases will be determined by the Discount Scale at no less thana 35% discount.Volume Points accumulate either from orders placed by you directlywith Herbalife Nutrition, which are referred to as Personally PurchasedVolume, or from orders your downline Members place with HerbalifeNutrition, which are called Downline Volume. Both types of volume may beused to achieve Senior Consultant Level at a 35% or 42% discount.All US/PR volume must be Documented Volume.13

MEMBER BENEFITSLevelQualificationAchieve 500 VolumePoints in one monthSeniorConsultantAchieve 2,000 VolumePoints in one rvisorSupervisor14Minimum 1,000 PersonallyPurchased VolumePoints (One Month)Achieve 2500 accumulated VolumePoints in 1-3 Months, of whicha minimum 1,000 is PersonallyPurchased VolumeAchieve 4,000 Volume Pointsin one volume month with aminimum 1,000 Volume PointsUnencumberedORAchieve 4,000 Volume Pointsover two consecutive months,with a minimum 1,000 VolumePoints UnencumberedORAccumulate 4,000 VolumePoints with minimum of 2,000Personally Purchased VolumePoints within 12 months with aminimum of 3 months required3 ways to qualify:See “Qualifying Supervisor” ry50%50%EligibilityAll orders will be placed at 35%discount off the Earn Base untilyou become eligible for a higherdiscount.Once you have achieved 2,000 youare eligible to place this order andall orders for the remainder of theVolume Month at a 42% discountoff the Earn Base. Discounts willrevert to 35% the next month untila higher discount qualification isachieved.Receive a 42% discount off the EarnBase on orders for the remainderof the month you qualify. Discountswill revert to 35% the next monthuntil a higher discount qualification isachieved.Receive a 42% off the Earn Basediscount on orders.Once Qualifying Volume Pointsare achieved additional orders arepurchased at a Temporary 50%discount off the Earn Base. Earn a 35% or 42% Retail Profiton the Earn Base Value. Earn 7%, 10% or 17% WholesaleProfit (Commission) on the EarnBase value from purchases madeby your downline Members at a25%-35%. Earn a 42% Retail Profit on theEarn Base Value. Earn 7% or 17% Wholesale Profit(Commission) on the Earn Basevalue from purchases made byyour downline Members at a 25%or 35% discount. Earn a 42% Retail Profit on theEarn Base Value. Earn 7-17% Wholesale Profit(Commission) on the Earn Basevalue from purchases made byyour downline Members at a 25%or 35% discount. Earn a 50% Retail Profiton the Earn Base Value. Earn up to 25% wholesaleProfit (Commission) onthe Earn Base Value frompurchases made by yourdownline Members at a25% - 42% discount. Earn a 50% Retail Profit on theEarn Base Value. Earn up to 25% wholesale Profit(Commission) on the Earn BaseValue from purchases made byyour downline Members at a25% - 42% discount. Earn Royalty Overrides of 1%to 5% on their first, second andthird-level active Supervisor*.As a Supervisor, you are entitled to a50% discount off the Earn Base onevery order. (Must requalify annually)*Group Volume on 3rd level Supervisor does not count towards your Organizational Volume.All US/PR Volume must be Documented Volume.Benefits

MEMBER BENEFITSSuccess BuilderFully Qualified SupervisorAs an Herbalife Nutrition Independent Member, you have anopportunity to purchase a single order of 1,000 Volume Pointsdirectly from Herbalife Nutrition at a 42% discount on Earn Basevalue. This qualifies you to become a Success Builder, and youwill be able to order at a 42% discount for the remainder of theVolume Month.At the Supervisor status you will earn the highest discount of50%, plus Retail and Wholesale Profit, and become eligible toearn Royalty Overrides (RO). Earn a 50% Retail Profit on the Earn Base valueMembers (non-Supervisors) who do not achieve Success Builderare able to order at a 42% once they have accumulated 2,000Volume Points in one month or have achieved the QualifiedProducer level. Earn up to 25% Wholesale Profit (Commission) on theEarn Base value from purchases made by your downlineMembers at a 25% - 42% discount Earn RO of 1% to 5% on their first, second and third-levelactive Supervisor* Attend special workshops and training sessions Qualify for special Supervisor recognition The Success Builder level is a Personally Purchased Volumequalification; Downline Volume may not be used toward thisdiscount opportunity.A Fully Qualified Supervisor is eligible to:QualificationQualified ProducerYou have the opportunity to achieve Qualified Producer statusby accumulating 2,500 Volume Points within 1-3 month of which1,500 points can be from Downline Volume. All volume achievedtowards this qualification must be from orders purchased directlyfrom Herbalife Nutrition.You will automatically receive the 42% once the qualification hasbeen achieved; and will be updated to this status on the 1st ofthe month following the month your qualification volume wasachieved.A Qualified Producer is eligible to: Purchase at 42% immediately after qualifying for this status Earn a 42% Retail Profit on the Earn Base Value Earn up to 17% Wholesale Profit (Commissions) on theEarn Base value from purchases made by your downlineMembers at a 25% or 35% discountQualifying SupervisorEligibility for Temporary 50% DiscountOnce you have achieved the required Volume Points towardSupervisor Qualification you will be considered a QualifyingSupervisor until the 1st of the following month, when youwill become a Fully Qualified Supervisor. As a QualifyingSupervisor, you are eligible for a temporary 50% discount for theremainder of the Volume Month in which your qualifying VolumePoints were achieved.The Volume from orders purchased at a Temporary 50% isconsidered Personal Volume for the purchaser and Group Volumefor the Fully Qualified Supervisor on the order.There are three ways to qualify as a Supervisor: One-Month Qualification: Achieve 4,000 Volume Points inone Volume Month (with a minimum 1,000

Active World Team, GET 2,500 and Millionaire Team 7,500 are recognition levels, not earnings levels in the Sales and Marketing Plan. For complete qualification details, refer to Page 14. All US/PR Volume must be Documented Volume As you start on your Herbalife Nutrition jou