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GOLDSEA 100
No. 6: Tei Fu Chen & Oi Lin Chen
Sunrider International
here are no weeds, as far as Tei Fu Chen is concerned, only herbs waiting to be discovered. That's the philosophy behind a cinematic success story that at one point had Chen, his four-year-old daughter Wendy and wife Oi Lin -- then pregnant with son Reuben -- living out of a broken-down car. The Taiwanese immigrant, then 30, had just been rejected from medical school, had no job prospects and only seven dollars and fifty cents in his pocket.
"The longer I stayed in the United States, it seemed the American dream moved farther and farther away," said Chen in his accented English.
Only four years later, in 1982, the Chen family's fortunes enjoyed a welcome reversal when wife Oi Lin got a medical degree and began practicing out of their Salt Lake City apartment. Her income gave Tei Fu the freedom to start boiling up herbal extract in the basement. Thus was born Sunrider International, with first-year sales of $330,000. Two years later the company moved to Los Angeles and proceeded to grow into an international multi-level company with 300,000 distributors in three-dozen countries and $700 million in sales.
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Chen develops and manufactures an extensive line of herbal foods, cosmetics and household cleansers in plants in Carson, Taiwan and Hong Kong. The plants are owned by the Sunrider Limited Partnership belonging to the Chen family. Sunrider International is essentially its sales arm structured as a direct marketing firm, with about 200 accounting and administrative core staff working in its gleaming new headquarters in Torrance, California and a network of distributors climbing the multi-level commission structure by singing up new distributors. The goal is to produce a growing pyramidal structure with the Chens at the apex.
Sunrider faces intense competition from a half dozen companies like Herbalife, NuSkin USA and Nature's Sunshine. At one time its fiercest detractor was Chen's sister who sued claiming that Sunrider was started with money belonging to her and her father for which they were entitled to partial ownership. She later started a competing herbal company. During the late 1980s Sunrider faced hostile coverage from shows like 20/20 and Inside Edition based on lawsuits alleging injuries suffered from using Sunrider products. The pressure was compounded by FDA scrutiny of medical claims formerly made in packaging and marketing brochures.
The adversity was great," recalled Chen of his early troubles. "Our resolve was ten times greater. Adversity has made us a better company, a stronger company, a wiser company."
Nevertheless, in the mid 1990s some of Sunrider's financial transactions and importing procedures drew the scrutiny of the IRS and U.S. Customs. The disputes were reportedly settled in 1997 by an agreement to pay $93 million in taxes and penalties.
Tei Fu Chen was born in 1948 in Chiayi in Southern Taiwan. He was a sickly child and studied Chinese medicine under his grandfather. He attended pharmacy school before marrying Oi Lin. In 1974 they came to Utah with their infant daughter Wendy where Chen studied chemistry and microbiology at Brigham Young University in the hopes of applying to medical school. Currently Tei Fu is Sunrider's Chairman and CEO while Oi Lin is President and COO. In addition to overseeing day-to-day operations, she developed Sunrider's Kandesne line of herbal beauty products.
| "The longer I stayed in the United States, it seemed the American dream moved farther and farther away." |