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.
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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.