Living Magazine doTERRA Winter 2016 - Page 6

Businesses run on the products they sell. It’s the most basic principle of commerce: people pay a business in exchange for something that would otherwise be unattainable. Those products, however, have to originate somewhere, and that’s where supply chain comes in. Supply chains entail how products are originally produced, processed, and then arrive to the consumer. dōTERRA’s supply chains, in general, start in the individual fields, forests, and groves where the plant material is harvested. The plant material is then steam distilled, or in the case of citrus oils cold pressed, and then transferred along the supply chain where these essential oils are either used as ingredients in blends or other products, or for our single oils bottled as the end product. As we continue along the supply chain, once the products are bottled, they are then delivered to fulfillment centers, and then sent out to retail locations or vendors, ultimately arriving in the hands of the end consumer. Typically, businesses strive to simplify their supply chains in order to save money and increase profits. Many companies contract with as few third party suppliers as possible. dōTERRA, however, develops relationships with the actual growers and distillers in each of our essential oils’ supply chains. “The danger of working with just one or even a handful of third-party supply companies to source our oils,” explains Tim Valentiner, the Director of Strategic Sourcing for dōTERRA, “is that we would be at the mercy of those companies. 6 / WINTER 2017 LIVING MAGAZINE We would have very limited visibility as to where the oils come from and who is actually producing them. “On the other hand, by working with the individual farmers and distillers, we know—intimately—who we are working with and the quality they produce. We can see their production capacity, and know much more effectively and timely about potential production, weather, or other challenges before they become problems. And most importantly, we can help provide the sourcing commitments, resources, and other tools they need to increase their capacity to grow with us. This completely changes the playing field for the small-scale farmer and distiller partners we are working with around the world.” Relationships It would, in fact, simplify things a great deal for dōTERRA to work with one company to supply our oils. But where efficiency and profitability might increase, we would fail in our vision of helping people throughout the world. “It’s an incredible challenge,” states Valentiner. “Where many companies are focused on sourcing raw material for maybe one or two products, we’re sourcing over 100 different oils from at least as many locations in 40+ countries. That’s a lot of partnerships to maintain, but it’s worth it for the good we are accomplishing.” When dōTERRA enters into a partnership with local farmers and artisan distillers, it’s not simply an agreement to purchase raw materials. dōTERRA guarantees first that these groups will receive timely and fair payments—something they are not always accustomed to. Because they are often at the mercy of middlemen, farmers and distillers have to settle for fluctuating prices and uncertain schedules. Instead, dōTERRA commits to a schedule and price, allowing these communities to plan ahead and improve their lives. The dōTERRA Co-Impact Sourcing® model also helps provide the resources and training necessary to improve production, which fuels even more change. In tandem with Co-Impact Sourcing, the dōTERRA Healing Hands Foundation™ steps in to help the people and communities where our essential oils are produced. Medical supplies, schools, microloans, water systems—the dōTERRA Healing Hands Foundation projects work to raise the standard of living for everyone.