Source: Press Release 5/4/2010

Amway Press Release

Amway Corp. today announced a series of changes to its supply chain structure aimed at improving the global direct selling leader's competitive position.

"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 Amway chairman Steve Van Andel. "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."

Through 2013: -- Amway will move production of several smaller product lines to Europe and Asia, reducing supply time and cost. -- Most production of air treatment and water treatment systems will move to Asia by 2013, where the vast majority of those products are sold. Similarly, production of some home care products will shift closer to high-demand markets in Europe and Asia. -- The company will consolidate activities at two North American facilities and move some of their functions to other California and Michigan locations.

The company will end production operations at the company's Lakeview facility in Lakeview, Calif. by 2013. Some operations will be relocated to existing facilities at the company's headquarters in Ada, Mich. - creating as many as 50 new Ada positions - while others will shift to the company's Buena Park, Calif. facility, which already has plans to expand, and company farms in Washington State, Mexico and Brazil.

The company's Spaulding Avenue facility in Michigan, underused since catalog sales and fulfillment operations were discontinued in 2009, will close in 2011. Employees will relocate to the main Fulton Street campus in Ada.

Amway will offer a retirement program to eligible employees to minimize job loss.

The air treatment, water treatment and home care moves are expected to eliminate 100 West Michigan positions. The company, however, said it expected normal attrition and a voluntary retirement program would likely cover all affected positions, minimizing involuntary job loss.

The Lakeview changes will eliminate as many as 150 positions. Employees will receive competitive severance packages and outplacement benefits.

Said Amway president Doug DeVos: "Changes that affect jobs are always difficult, even when they are done to make our company more competitive. 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."

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