PM-International: Agility Through Innovation

Investment in R&D positions company to deliver on founder’s vision of growth.

Based in Schengen, Luxembourg, PM-International develops and distributes through its independent sales force of approximately 35,000 distributors (called “Team Partners”) a variety of premium products for health, fitness and beauty through its brand, FitLine®. The company was founded as P.M. Cosmetics GmbH in Germany in 1993 by its current CEO, Rolf Sorg. Today, PM-International operates in more than 40 countries and employs a staff of more than 670 employees. In 2019, PM-International celebrated the grand opening of its Headquarters Americas, including a fulfillment center, in Sarasota, Florida. Global sales for 2019 reached $1.11 billion, marking the first time the company broke the $1 billion barrier; global sales were $834 million the year prior. “We weren’t the fastest company in the market to get to $1 billion,” Sorg says, “but we were always growing consistently, always with a clear focus on our goals and core values.”

Sorg was a student looking for a side income when he discovered direct sales. Eventually, he worked his way up to become the company’s most successful distributor, at which point he made the decision to pursue direct selling full time. In 1993, the company Sorg represented went out of business, so he opted to start his own. His objective, he says, was to give others the same opportunities he’d enjoyed in the industry: premium quality products and a transparent, fair and duplicable business model. “We live by the principles ‘If I can do it, you can do it’ and ‘simple, successful,’” Sorg says.

“Keeping our distance does not mean we can’t provide personal customer service, have exchanges within the team or hold trainings anymore.
—Rolf Sorg. Founder & CEO, PM-International

Milestones

Among the company’s achievements in its 27-year history is its involvement in international elite sports. PM-International’s FitLine® brand has partnered with organizations including the German, Austrian and Polish ski associations, German Ice Hockey Federation, German Cycling Federation, German Athletics Association, Swiss Sliding Federation, the Swiss and Luxembourg Handball Federations and the Luxembourg Basketball Federation. As of 2020, FitLine is also the official supplier of nutritional products of the Canadian Ski Association Alpine Canada. The company also collaborates with the Cologne List®, which only includes products that have undergone rigorous tests for specific doping substances. These third-party, high-profile alliances have been advantageous for the sales force, Sorg says. “The sports marketing conceptof PM-International, and especially the testimonials and success stories of the athletes, increase the trust in our brand. For our distribution partners, it’s a tool to spark interest in our products among athletes and sports fans.”

In 2013, PM-International was the first direct sales company to receive the certified direct sales rating from the German Association for Technical Inspection (TÜV Hessen). The certification procedure includes an on-site audit at company headquarters and evaluates such criteria as license fees, support of distribution partners and transparency of the marketing plan.

“The sports marketing concept of PM-International, and especially the testimonials and success stories of the athletes, increase the trust in our brand.
—Rolf Sorg

Research and Development

In the spirit of continual improvement, PM-International has made a significant investment in research and development in recent years. They concentrated on intensifying basic and applied research with its in-house team of scientists from the fields of nutritional sciences, cell research and food technology and collaborating with universities and research institutions like the Luxembourg Institute of Science and Technology (LIST) and the University of Applied Sciences Upper Austria. Thanks to its ongoing commitment to innovation, the company owns more than 70 national and international patents.

“Our main task is to develop new high-quality products for health, fitness and beauty,” says Dr. Tobias Kühne, Chief Scientific Officer at PM-International. “In addition, we’re relentlessly working on increasing the bioavailability of FitLine® products by developing and improving new formulations, replacing ingredients and reworking recipes around our patented NTC® and thus improving people’s quality of life.”

In 2016, the company signed a strategic collaboration agreement with the Luxembourg Institute of Science and Technology (LIST). A joint research project, ACTIVITIS, aims to extract secondary plant compounds from grape pomace, a by-product of the local wine industry, and “upcycle” them for industrial purposes in a sustainable way. Last year, PM-International made a substantial contribution to the opening of the Josef Ressel Center for Phytogenic Drug Research at the University of Applied Sciences Upper Austria.

The Pandemic

Our global pandemic, Sorg says, has reminded his company and distributors how important it is to be flexible and adapt quickly in the face of disruption. “I’m especially proud of our Team Partners— they’ve kept a positive focus and shown great leadership throughout these challenging times. Keeping our distance does not mean we can’t provide personal customer service, have exchanges within the team or hold trainings anymore.”

Having already introduced a series of digital innovations to its sales force in the months before the pandemic, PM-International was prepared to pivot its operations and help its distributors to do the same when stay-at-home orders began throughout the globe. At the beginning of the year, the company introduced PM TV, which offers unlimited streaming of events, training and information to a worldwide audience. Team Partners have the infrastructure to consult their customers via video conference from home and place orders online. On the back end, those orders are handled in-house through the company’s Customer Direct Program. As an additional support, PM-International offered worldwide free shipping for end customers during April, May and June.

Earlier this summer, PM-International announced the global launch of its PM DirectCash program, which enables Team Partners to receive their retail income instantly for every online customer order. Retail income is credited in realtime to the distributor’s My PMPay e-wallet mobile app, after which she may choose for the funds to be deposited into a bank account, her My PMPay debit card or PayPal account. The PM DirectCash program represents another step forward in giving Team Partners the ability to run a completely digital business.

Philanthropy

Through its foundation, PM We Care, PM-International has been involved with global philanthropic efforts for nearly two decades.

As the largest corporate sponsor of the relief, development, and advocacy organization World Vision, PM We Care supports 2,300 sponsored children, their families and entire communities in more than 60 regional development projects around the world, including India, Peru, Cambodia, Mongolia, Ghana and Indonesia.

In response to the global pandemic, PM-International established “PM Helps,” a fund of 1 million euros to help people in some of Europe’s most severely affected regions including Germany, France, Spain and Italy. Donations included protective gear and medical devices for hospitals, energy bars from its own product line and money to provide catering for health care workers and families in need, as well as disinfectant for the safe reopening of schools.

“Our next goal is to realize 100 percent recyclable product packaging by the end of the year.”
—Rolf Sorg

The Future

“I see it as my personal responsibility to Team Partners to build a business model that will continue to function sustainably for future generations. Sustainability is an important topic we are working with right now,” Sorg says. “Our next goal is to realize 100 percent recyclable product packaging by the end of the year.”

The company’s ambitious growth plan includes the investment of several million euros in the expansion of the company’s International Headquarters in Luxembourg, a fourth warehouse at its European Logistic Center in Germany, an additional 10,000-plus square feet of storage space at its Headquarters Americas in Florida and additional office space for Headquarters Asia-Pacific in Singapore. As for its global expansion strategy, PM-International recently began operations in Ukraine. Next on the company’s agenda are grand openings in Canada and Indonesia, and an expansion of its business in Europe, with pre-launch phases in the United Kingdom, Belgium and Hungary. “Strategically and economically, we are well positioned to become Europe’s largest network marketing company within the next three years,” he adds.

“Now the tyranny of the present is supreme. A lot of organizations have had no choice but to focus on surviving immediate threats,” says J. Peter Scoblic in an article for Harvard Business Review (“Learning from the Future”; July/August 2020). At the same time, he adds, leaders must continue to plan for the future even in the face of uncertainty.

“The stakes are high, and decisions that leaders make now may have ramifications for years—or even decades. As they try to manage their way through the crisis, they need a way to link current moves to future outcomes.”