LifeVantage announced today that it has implemented cost reduction initiatives designed to reduce operating costs while increasing efficiency and productivity throughout the Company.
In February of this year, LifeVantage announced that an experienced 52 person network marketing team was joining its existing nine person corporate team. Following the merger of these two teams, the Company instituted a comprehensive review to evaluate, merge and streamline job functions and responsibilities to recognize the traditional benefits of eliminating redundant functions. As a result, the Company has already phased-out or plans to phase out a total of 18 positions by the end of this quarter. Of these, four employees have been offered alternative positions which better fit the individual employees’ skill sets and the Company’s growth needs. With these changes as well as some independent departures, the Company will have 44 employees. These initiatives are expected to allow LifeVantage to retain the most qualified and essential personnel required for continued operations and growth of its network marketing distribution model.
Earlier this year, LifeVantage launched into the network marketing sales channel and the Company looks forward to recognizing the benefits of its new team and revenue model. Expenses related to the addition of the new team, legal and marketing expenses necessary to re-launch the Company and TrueScience™, the Company’s new skin cream product, have now been recognized. In addition, LifeVantage has also implemented reductions in overhead and operating expenses and moving forward the Company is poised to execute its growth plans with a more efficient corporate and operational structure.
“It is never easy to integrate and transition a new team, and while these decisions were difficult, they are essential in attaining profitability while maintaining competitiveness and financial flexibility moving forward,†stated David W. Brown, LifeVantage President & CEO. “During these high-growth times, our priorities are investing in the right areas of our business, leveraging cash and continuing to effectively make use of our existing team in order to become profitable for the long term benefit of our stockholders, employees, distributors and customers,†added Mr. Brown. “We saw an expected substantial increase in net revenue of 150% in the fourth quarter which demonstrates the early results of our expansion into the network marketing sales channel. We believe the team we now have in place will continue to significantly impact our continued growth and expansion.â€
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