Amway to Close Nutrilite Birthplace

The Nutrilite facility where Amways founder Carl Rehnborg began experimenting with vitamins in the 1940s has been tagged for closure by the company, which plans to slowly divest the plant over the next three years. Amway said the shutdown is not a capacity cutback but rather a reorganization of its supply chain to reflect the growing dominance of its foreign customer base. Although some work will be shifted to Amways Ada, Mich. headquarters, the remaining capacity will be shifted to its expanded Buena Park, Calif. plant, as well as facilities in Washington state, Mexico and Brazil. The company said relocating its agricultural production to other states and countries will provide more acreage and increased production capability.

More than 80 percent of our customers buy our products outside the United States, and Amway needs to update its supply chain to reflect that, said Steve Van Andel, chairman of Amway. As part of our long-term strategy, we are moving some production closer to customers to cut supply times and significantly reduce shipping-related costs. Some of these steps are difficult, but they will help us drive long-term growth and sustain existing jobs in all our markets.

As part of this supply chain shift, the company will close its under-used Spaulding facility (Michigan) in 2011, relocating its employees to the main Fulton Street campus in Ada.

As for its Lakeview work force, around 150 employees will be affected by the closure, according to the company. Management said it expects some of the separations will include early retirements and normal attrition, but most of the people will be given severance packages, including outplacement services. The exact dates of the layoffs are pending.

Changes that affect jobs are always difficult, even when they are done to make our company more competitive, said Doug DeVos, president of Amway. Saying good-bye to long-time friends and colleagues who have been with us through good and tough times is especially painful. We will do all we can during these changes to provide support to affected employees. We owe them our thanks for helping build a strong Amway over the years.

Established in 1954, the 600-acre facility included a vegetable and herb farm, along with a processing plant for the dehydration and processing of the crops for Nutrilite products. Concentrates from this facility were used in as much as 80 percent of Nutrilite products throughout its history of production.

In addition to the Lakeview and Spaulding closures, Amways said by 2013 it plans to move production of several smaller product lines to Europe and Asia to reduce supply time and cost; production of air and water treatment systems to Asia, where most are sold; and production of home care products to Europe and Asian markets.