February 2006

Welcome to the latest issue of Nutraceutical News from IFS. In this issue you'll find a new occasional column called "Did You Know...?" that offers up interesting tidbits about the nutraceuticals industry. As for our other columns, the importance of timely turnaround is discussed in the Fulfillment Notes section. In our Marketing column, we'll tell you about the value of developing a marketing plan, and in this issue's Customer Service Corner we talk about "nothing but the best" - in other words, not settling for mediocre customer service.

For more information about the content found here or about any of our products and services, you can always visit our website, www.ifssolutions.com. To share your feedback about this newsletter, please click here. To unsubscribe, please use the link at the end of this issue.

In this issue:

• Did You Know...?: Interesting tidbits about the nutraceuticals industry
• Fulfillment Notes: The Importance of timely turnaround
• Maximize Your Marketing Effectiveness: Planning your work and working your plan - the value of writing a marketing plan
• Customer Service Corner: Nothing but the best: don't be wiling to settle for mediocre customer service!
• About IFS: For More Information, Contact Us

The nutraceuticals industry is growing so rapidly, it's hard to stay on top of all the information out there! We hope you'll enjoy having us occasionally share some interesting tidbits we come across.

For instance, did you know the term "nutraceutical" was coined in 1989 by Stephen DeFelice, MD, founder and president of the Foundation for Innovation in Medicine? A nutraceutical is defined as "any substance considered a food, or part of a food, with medical or health benefits, including the prevention, treatment or cure of disease."

Here are some other quick tidbits:

• The American nutraceutical market is estimated to be a $250-billion a year industry, larger than the prescription and over-the-counter drug markets combined.
• There is overwhelming evidence to support the use of foods to treat disease and prevent recurrence. For example, it is estimated that if Americans increased their fiber intake, about 50,000 cases of colon cancer could be prevented, saving over $2 billion in medical costs.
• Experts believe that nutraceuticals have helped reduce the incidence of cardiovascular disease and breast, lung and stomach cancers, saving an estimated $8.7 billion.
• Hypertension affects an estimated 58 million Americans and contributes to about 250,000 deaths each year. Nutraceuticals, in the form of potassium, calcium and magnesium supplements or fiber, can be of great help to those with high blood pressure.
• High cholesterol levels put more than half of all Americans at risk of developing heart disease. Nutraceuticals, such as fiber and Omega-3 fatty acids, can help reduce cholesterol levels and the associated heart attack risk.
• 50% of American physicians recommend nutraceuticals for their patients.
• 80% of physicians use nutraceuticals themselves.

Much of this information was extracted from the 2002 Journal of The Mindshift Institute. For additional information, a good resource is the American Nutraceutical Association's website, www.americanutra.com, and the Institute for Nutraceutical Research at Clemson University. That website is www.clemson.edu/INR.

When it comes to fulfillment - especially for new customers - timely turnaround is important. Customers who have never ordered before become much more confident in a company when they receive their order in a very timely manner - especially when they only placed it a few days ago.

Of course there are several things that will affect the timely arrival of your order. One is how your company defines its "standard" for shipping. Do you typically ship your orders the same week they are received, or - like IFS - do you ship them the same day you receive them? Because IFS is committed to exceptional customer service, our standard policy is to ship 100% of our orders by the next business day. However, because we manage fulfillment for so many nutraceutical companies, the reality is that we ship 97% of all orders the same day they are received. Rush orders all ship the same day for overnight delivery.

Another issue related to timely turnaround is your method of shipping. Because most nutraceutical products are relatively lightweight, we have found the United States Postal Service (USPS) to be the best, most cost effective service provider. In most cases, our shipments are delivered two-to-four days after shipping. And through experience, we have found that by using a particular shipping method through the USPS, we can likely save you a great deal of money on freight.

Once you gain a new customer, offer them a subscription (automatic refill) program:it will be the best thing you can do to ensure regular, timely delivery of their orders.

It's still very early in 2006. Do you have your marketing plan in place for the year? If not, you should! Developing a plan and committing to a budget early in the year will mean you won't be saying, "Gosh, we missed that marketing opportunity" come next November or December.

If you've never done a marketing plan before, don't put it off! Consider all the various activities that should help you reach your target customers and get something in writing. Even if your plan changes or your budget has to be adjusted, it is much easier to fine-tune a plan once it is down on paper, than to just "wing it" all year long, throwing money at different projects that seem good at the time.

As you develop your marketing plan, be sure to consider any seasonality issues as well as trade show opportunities, special promotions you've considered and any other marketing and/or public relations events you might want to explore.

If you start with a plan and then work that plan, you're almost certain to see a positive impact on your sales effort.

Be candid with yourself for a moment. How well are your customers really being treated? Do ALL your telephone representatives do a fabulous job on the phones? Are they all well versed in your products and their benefits? Or do they do an "okay" job and you just keep putting off making a change?

Don't put off excellent customer service any longer. Deal with it today. Either hire and train talented new customer service people or consider outsourcing your order-taking process. We'll gladly share case studies that you can take to the bank showing how improved customer service can absolutely make a positive impact on the bottom line in a very short period of time.

In fact, in one example, an IFS client featured on a cable television program had used a large, non-personal, call center. It was able to convert only 4 out of 75 callers into customers for a conversion rate of 5%. And that was with an average call length of almost five minutes. In contrast, by providing personal service with highly trained attendants, IFS took nearly 250 calls and converted 25.5% of those callers into buyers at an average order of approximately $80. And that was in 2 minutes 35 seconds - half the time of the other call center!

So once you commit to "nothing but the best" for your customer service staff, you'll quickly see the impact on your bottom line.

IFS is a world class, full service fulfillment operation with a track record of success. A woman-owned business, we proudly serve some of the country's most respected corporations. With a special expertise in the fulfillment of nutraceuticals, we can help you run your nutraceuticals business more efficiently and more cost effectively.