For all the shopaholics and bargain hunters or those who just like a good deal, it’s hard to miss how e-commerce is taking over the world, or at least the retail industry. In the past few years, online shopping has exploded in popularity, giving traditional brick-and-mortar stores a run for their money, quite literally. With just a few clicks, consumers can now buy anything from groceries to gadgets, all without leaving the comfort of their own homes. Many consumers don’t typically think about ordering health supplements, home cleaning products, or even color cosmetics online, but with the health and wellness shopping club Melaleuca, people are bucking that trend and reaping the many benefits.
Melaleuca is no stranger to the e-commerce industry. For many years, the vast majority of Melaleuca’s wellness products have been sold directly to customers through the Melaleuca website, the company’s goal being to outperform national brands sold in brick-and-mortar stores.
Research from the Commercial Real Estate Service (CBRE) shows that by 2025, one in four purchases for the average American household will be made online. This is due to the continual growth of the e-commerce industry. Over the last five years alone, e-commerce has grown over 140% and is now one of the fastest-growing markets. And the average consumer is branching out into buying things they wouldn’t have in the past. From designer clothing and handbags to other things like artisanal cheeses and even health and wellness products, it seems like anything can be found and bought online these days.
But this can only be done because companies are getting better at getting their items out to their customers faster. And shipping products quickly leads to more growth in the e-commerce industry. This growth is good but also leads to a big issue — space. Online retailers have had to keep more products on hand to meet the growing demand of their customers, and that has required more space for storing products closer to key distribution hubs.
This has led to a surge in industrial real estate being both bought up and built. According to CBRE, the demand for industrial real estate has outpaced supply. The future of e-commerce is bright, but careful planning will be required to keep up with the demand for online shopping. Melaleuca is no exception, and the company has been making preparations and purchases to accommodate its own future growth and enhance the shopping experience of Melaleuca customers.
Melaleuca and Its Growth Over the Years
As mentioned previously, Melaleuca: The Wellness Company is an online shopping club. Melaleuca manufactures a variety of health and wellness products, including supplements and nutrition products, eco-friendly cleaning products, personal care products, cosmetics, and essential oils. Through innovative scientific research, the company strives to create safer products with eco-friendly and naturally based ingredients to help its customers optimize health in both their bodies and their homes. Melaleuca is now leading the way in providing people with a unique shopping experience, all without shoppers leaving their homes. This Idaho-based company has been in business for more than three decades.
Melaleuca operates what is called a consumer-direct business model, in which customers buy products directly from the company without middlemen, like stores or advertisers. This has worked well, especially with the advent of the internet, which allowed Melaleuca to seamlessly transition into operating what is now one of the largest health and wellness shopping clubs in North America, with over 400 different products.
In 1992, Melaleuca constructed its first distribution and production center outside of Idaho in Knoxville, Tennessee. The 175,000-square-foot facility served Melaleuca well and gave it a foothold in the eastern United States. Then, in 2008, to better meet the needs of its growing customer base and the increased demand for products, Melaleuca drew up plans to add another production and distribution center in Idaho Falls. That facility was finished in 2010. Almost immediately, the new facility changed how quickly packages were shipped and received. Shipping time went from a week or more to just a few days.
In that same year, business for Melaleuca had taken off so much that another facility was built in Knoxville to meet Melaleuca’s growing needs. This new 231,000-square-foot facility took on more of a distribution role, allowing the older facility to focus solely on production.
Growing to Meet Consumer Needs
Many other companies these days are familiar with this level of growth. With the rise of e-commerce, companies like Amazon, Walmart, and Costco are buying up warehouse space to meet the needs of their customers. Even smaller companies are having to make these kinds of changes. This is because businesses are seeing the need to shift more attention to online sales and are experiencing rapid growth as a result.
Many Americans report that they prefer to shop online. Consumers can browse and make purchases anytime from anywhere with an internet connection. This appeals to those who lead busy lives and don’t have time to visit stores during regular business hours. Others discover that they have more family time.
And unlike physical stores with physical space limitations, online retailers can offer a virtually limitless selection of products. This makes it easier for consumers to find exactly what they’re looking for, whether it’s a rare collectible, a specific brand of health and wellness product, or the healthiest alternative to a favorite junk food.
If CBRE’s projections are correct, then the United States will need about 330 million more square feet of distribution and warehouse space to handle the growth of e-commerce. Many companies are turning to third-party logistics providers to meet their warehousing and distribution needs. That can be costly and time-consuming, but it allows companies to ship to their customers more quickly. Some companies, like Melaleuca, are opting to build their own warehouses or distribution centers to meet their specific needs.
The Melaleuca Kansas City Center
In 2020, when many companies were struggling, Melaleuca experienced significant growth and saw an opportunity not only to save time but also to better meet the needs of its customer base. The company purchased a 508,000-square-foot warehouse in Kansas City, Missouri, that was previously owned by Harley-Davidson. By acquiring an existing facility, Melaleuca was able to quickly expand its capabilities at a key distribution hub in the heart of the country.
This new facility is just the logical next step to ensure the timely arrival of products at the homes of Melaleuca customers. It also helps to split the load of the other two distribution centers currently operated by Melaleuca. The Idaho Falls center can focus on the western regions of the United States, the Knoxville center can ship to its customers in the eastern regions, and now the Kansas City facility will ship to Melaleuca customers in the midwestern regions.
So, to meet the growing demand, Melaleuca expanded its facilities and built them up to be at the cutting edge of technology and allow for more growth in the future. This allowed it to improve its supply chain management and order fulfillment, which has become increasingly important in the competitive e-commerce landscape. By offering its customers a more convenient and efficient online shopping experience, Melaleuca continues to stand out from the crowd and attract more customers. This highlights the importance of innovation and adaptability in the e-commerce industry; businesses must constantly evolve to meet the changing needs and preferences of their customers.
By continuing its tradition of repurposing existing buildings, Melaleuca avoided the environmental impact of building a new facility while it supported the local economy. Overall, the purchase allowed Melaleuca to better serve its customers while demonstrating a commitment to sustainability and responsible resource management. Because Melaleuca believes strongly in sustainability and environmentalism, many Melaleuca products are made in the same month they are purchased and shipped. This cuts down on waste and ensures the freshest products available in many cases.
Melaleuca Is Growing Toward the Future
Already, the impact of the Kansas City facility has been felt. The average shipping time for many customers has been cut in half; as a result, most customers receive their products within two business days. Melaleuca is committed to providing safe, effective, and environmentally friendly products, which has been a key factor in its success. Melaleuca makes over $2 billion in sales annually. The company focuses on using natural ingredients and other natural compounds and avoiding harsh chemicals, which resonates with Melaleuca consumers who are looking for healthier alternatives to grocery store brands and other traditional products.
In addition, Melaleuca’s consumer-direct model has allowed this wellness company to build strong relationships with its customers and provide personalized service and support. This has helped to quickly foster a loyal customer base that values the quality and effectiveness of Melaleuca products. Melaleuca has positioned itself for long-term growth and success by prioritizing innovation, sustainability, and exceptional customer service. Melaleuca’s commitment to these values is reflected in its products, services, and business operations.
All these efforts contribute to the company’s success and reputation in the industry. As reported, e-commerce has seen a 140% increase in the last five years alone. It’s not just here to stay; it might be here to completely take over. As it stands, e-commerce is continuing to grow, and so is the need for more warehouse space in strategic locations. Like other e-commerce leaders, Melaleuca is expanding its warehouse and distribution capabilities, and its focus on getting closer to its customers will ensure great customer satisfaction and continued growth.