1. Mainland China Opportunity Training “Be the Difference” Global Convention 2002

2. Overview of Mainland China Market

3. Mainland China Demographics 3 rd largest country by land mass 9.6 million kilometers 2 1.3 billion people 30 provinces Avg. GDP per capita 6,300 Rmb (US $770.00) Sixth largest economy in the world

4. Other Area 95% Phase II 5% Guandong 35% Jiangsu 26% Shanghai 1% Zhejiang 19% Fujian 12% Mainland China Demographics Land Mass 9,600,000 sq km

5. Guandong 34% Jiangsu 29% Shanghai 6% Zhejiang 18% Fujian 13% Mainland China Demographics Population 1.3 billion people Other Area 80% Phase II 20%

6. Guandong 34% Jiangsu 22% Shanghai 14% Zhejiang 19% Fujian 11% Mainland China Demographics Retail Sales 2.86 Trillion Rmb Phase II 42% Other Area 58%

7. Mainland China Demographics Annual Urban per Capita Income 9,762 Rmb (US $1,180) 7,432 Rmb (US $910) 9,279 Rmb (US $1,130) 11,718 Rmb (US $1,430) 6,800 Rmb (US $830)

8. Guangzhou 1 Flagship Store 30 TE Stores Shenzhen 5 TE Stores Guandong Province Largest consumer market in China Developed retail sector Ranks #1 in foreign investment Population: 67.89 million people Land Area: 179,000 sq km Shantou 4 TE Stores Foshan 2 TE Stores Nanhai 2 TE Stores

9. Fujian Province Fuzhou 1 Flagship Store 5 TE Stores Xiamen 3 TE Stores Favorable economic policies Leading province for Twn, HK, and Macao compatriots Population: 31.83 million Land Area: 120,000 sq km Quanzhou 2 TE Stores

10. Zhejiang Province Hangzhou 1 Flagship Store 5 TE Stores “Land of silk and Tea” Strongest non-state owned economy Retail sales jumped 10.7% in 2001 Population: 43.64 million Land Area: 100,000 sq km Ningbo 1 TE Store

11. Jiangsu Province Nanjing 1 Flagship Store 5 TE Stores Wuxi 5 TE Stores Second strongest economy in China Population: 70.21 million Land Area: 100,000 sq km Suzhou 2 TE Stores

12. Shanghai 1 Flagship Store 30 TE Stores Pearl of the Orient China’s center of economy, finance, and trade Excellent infrastructure High income and purchasing power Population: 14 million Land Area: 6,340 sq km

13. Direct Selling: Analysts predict China’s direct selling market will be between $5 billion and $7 billion by 2005 making it the third largest direct selling market in the world. Cosmetic and Toiletries: By 2005 it is estimated that the China cosmetic and toiletry market will reach $8.9 billion in sales. Mainland China Market Projections

14. Summary of Mainland China Development

15. Timeline 1990 Beginning of DS Industry 1996 DS Ind. Est. $100 million 1998 Government imposed ban 2001 voted into WTO 2004 WTO Entry (New DS Regulations) 2000 Nu Skin Phase I 2003 Nu Skin Phase II 2002 DS Ind. Est. $1 billion 2005 DS Ind. Est. $5 Billion History of Direct Selling in China

16. 1993 - Investigative trips to China 1993-1997 - Expansion throughout Asia and the World 1998 - PHASE I - Began investment in China - Acquired Pharmanex assets - Development stalled due to Government imposed ban 1999 - Revised strategic plan based on Government regulations 2000 - Acquired retail stores 2001 - Nu Skin manufacturing plant completed 2002 - Aggressive expansion plans announced* 2003 - PHASE II - Retail store model with TE and Executive participation * Total investment through 2002 is US $80 million Nu Skin’s History in China

17. Shanghai Manufacturing Facility

18. Force for Good Construction of Primary School in Chun An County Provided funds for construction of school Donate textbooks and study materials To be finished in September, 2002

19. Mainland China Business Model

20. How to participate in Mainland China Maintain executive level outside of China Attend China specific training* Take and pass test on China rules and regulations *Consult with your local office for regional training on China

21. Retail Sales Model All sales must occur at a Nu Skin retail store Sales must occur from an employed sales force China laws and regulations require:

22. Retail Store Layout

23. Guangzhou TE Store

24. Who can be referred as a Sales Representative? Resident of the People’s Republic of China Over 22 years of age No students No full-time military service No government employees Must first be a Preferred Customer

25. Sales Representative Application Referring ID number Contact information of potential Sales Rep Date of birth Personal ID # Degree of education

26. Where to refer Sales Representatives? Flagship Stores Team Elite Stores Sales Representative Applications can be found at: –each retail store –through the Chinese Business Center on the internet

27. SR Hiring Procedure First become a Preferred Customer Recommended by China Registered Executive or local preferred customer or sales representative. –Shanghai Nu Skin plans to begin receiving application on or about January 9 th Interview with Branch Office Qualifications: –received sales training –desire to learn about personal care products –Willingness to be employed

28. Mainland China Commissions and Compensation Plan

29. Attract customers Attract preferred customers Encourage preferred customer to apply to become a sales representative Product and sales training All sales representatives and retail store employees are employed by Nu Skin Nu Skin Executive Responsibilities within Mainland China

30. China TitleNu Skin Enterprises TitleCustomer Preferred Customer (PC)Distributor Sales Representative (SR) Executive Team Sales Manager (TSM) Gold Executive Senior Sales Manager (SSM) Lapis Executive Fixed Retail LocationWalk-in Center Sales BonusCommission The China Phase II marketing plan is a store based retail model and is different than our global seamless marketing plan. Mainland China Terminology Similar to

31. No independent distributors All sales must occur at fixed retail locations through employee sales representatives All product and sales training meetings must be registered with Nu Skin Training is only for employee sales representatives and potential employee sales representatives Mainland China Sales Plan

32. Customer Purchases at full retail price Not linked to Sales Representative – Sales Representative is responsible for providing ID number to receive credit for purchase

33. Preferred Customer  Minimum 500 Rmb retail purchase  Future purchases at 10% discount  Linked to Sales Representative or executive

34. Preferred Customer Referral Form Referring ID number Contact information Personal ID number SR name and ID # TSM name and ID # Preferred Customer card included in form

35. Qualifying Sales Representative  First become a preferred Customer  Submit Sales Representative application form  Obtain the following monthly volumes:  Purchase at 10% discount  Work up to 20 hours per week as temporary employee  250 Rmb base pay plus up to 10% Service Bonus

36. Sales Representative  Permanent employee of Shanghai Nu Skin  Purchase at 15% discount  Work up to 20 hours per week at retail store  Same compensation as QSR, plus 5-15% Retail Sales Bonus on GSV

37. Sales Representative If minimum GSV benchmarks are not met, employee may be terminated at company’s discretion.

38. Team Sales Manager  Meet Sales Representative qualifications  Additional 1,000 G1 GSV  Receive 2.5% or 5.0 % of G1 GSV

39. Team Sales Manager *paid on personally trained SR and TSM GSV. Manager Training Bonus

40. Senior Sales Manager  Meet Sales Representative qualifications  Additional 2,000 G1 GSV  Receive 2.5% or 5.0 % on G1 GSV  Receive 2.5% or 5% on G2 GSV

41. Senior Sales Manager Senior Manager Training Bonus **paid on personally trained SR, TSM, and SSM GSV as well as Team Sales Manager’s personally trained SR and TSM

42. International Volume Flow  Register for China activity - attend China specific training - pass examination  Purchase at 15% discount  Registered travel 15 days per quarter  Refer preferred Customers and Sales Representatives  Maintain pin title and volumes outside of China  Receive Executive Bonus and Breakaway Bonus on China activity

43. Products

44. Nu Skin Premium Products Face Care Retail Price* (Rmb)Price (US$)Point Value Creamy Cleansing Lotion150$18.3011.0 Pure Cleansing Gel 150$18.3011.0 Exfoliant Scrub150$18.30 11.0 pH Balance Hydrating120$14.60 9.0 pH Balance Mattefying120$14.60 9.0 Celltrex Ultra Recovery Fluid400$48.80 30.0 Moisture Restore Day Lotion n/d320$39.0024.0 Moisture Restore Day Lotion c/o320$39.0024.0 NaPCA Moisturizer300$36.6022.0 Enhancer Skin Conditioning Gel120$14.609.0 Night Supply Lotion c/o375$45.7028.0 Night Supply Cream n/d375$45.7028.0 Rejuvenating Cream350$42.7026.0 NaPCA Moisture Mist115$14.008.5 *Retail price is VAT inclusive

45. Nu Skin Premium Products Body CareRetail Price* (Rmb)Price (US$)Point Value Body Bar 125$15.209.25 ABC Gel 100$12.207.5 Body Smoother 155$18.9011.5 Hand Lotion 115$14.008.5 Liquid Body Lufra 130$15.909.5 Treatment Face Lift - Sensitive 430$52.4032.0 NSW Skin Lotion 315$38.4023.5 NSW Skin Essence470$57.3035.0 NSW Milk Lotion350$42.7026.0 NSW Cream400$48.8030.0 *Retail price is VAT inclusive

46. Face Care Price Comparison

47. Treatment Price Comparison

48. Body Care Price Comparison

49. Locally Branded Products

50. Locally Branded Product Price List Scion Retail Price* (Rmb)Price US$Point Value Facial Cleansing Gel60$7.304.5 Refining Facial Toner60$7.304.5 Polishing Cream65$7.904.8 Moisture Light Cream70$8.505.2 Moisture Rich Cream80$9.756.0 Hydrating Peel-Off Masque70$8.505.2 Deep Cleansing Clay Masque70$8.505.2 Eye Gel90$11.006.7 Pure Shampoo35$4.302.6 Pure Conditioner35$4.302.6 Scalp & Hair Treatment30$3.652.2 Two-in-One Shampoo & Conditioner35$4.302.6 Styling Gel38$4.602.8 Hand & Body Moisture Lotion50$6.103.7 Moisturizing Hand & Body Wash35$4.302.6 *Retail price is VAT inclusive

51. SP Pure for teen age skin Retail Price* (Rmb)Price US$Point Value Cleansing Lotion 35$4.252.6 Refreshing Tonic35$4.252.6 Facial Moisturizer40$4.903.0 Facial Mask40$4.903.0 Everyday Toothpaste 135g30$3.652.2 Clean Land Feminine Wash32$3.902.4 Locally Branded Product Price List *Retail price is VAT inclusive

52. Her ShadesRetail Price *(Rmb)Price US$Point Value Foundation100$12.207.5 Lipstick75$9.155.6 Eye shadow90$11.006.7 Blush90$11.006.7 Lip Liner40$4.903.0 Wet/Dry Powder130$15.859.7 Finishing Powder100$12.207.5 Waterproof Mascara65$7.904.8 Limited Time Offers Twinkling Lip Gloss60$7.304.5 Beautyberry Lip Balm25$3.051.8 Locally Branded Product Price List *Retail price is VAT inclusive

53. Policies and Procedures

54. Travel to Mainland China Only China trained Executives All business* travel must be registered Business travel limited to 15 days per quarter *Business travel equates to meetings with more than 5 people

55. Travel Approval Form Name Distributor ID Date of travel Location of travel Duration of visit Purpose of trip Type of training performed

56. Training Meetings Notification –Must notify Nu Skin 15 days in advance Location –only at company facilities or approved rented hotel meeting rooms Duration –Meetings can last no longer than 3 hours –No more than 1 meeting per day

57. Training Meetings Fees –No fees can be collected for meeting attendance Content –Meetings should be related to: Product Training Sales Training Customer Service Company Policies

58. Training Request Form Name Distributor ID Location of training Date and time of training Number of attendees Meeting agenda

59. Do : Provide Critical training on – Business model review – Local product training Training Rules Do Not: Promote get rich scenarios Discuss future finances and retirement Talk negative about government enterprises Talk about distributor groups

60. Additional Communication by China Business Center

61. China Business Center Latest information Training material View China compensation plan

62. China Business Center Phase II Available November 2002 Preferred Customer Referral Forms Sales Representative Applications Travel Approval Forms Training Request Forms Store Locator

63. Training Materials Copy of this presentation Compensation Plan Brochure Compensation Plan training material Draft Shanghai Nu Skin Product Catalog List of completed stores Video CD

64. China Opportunity Training “Be the Difference” Global Convention 2002