Hy Cite: A Global Leader in Direct-Selling Premium Cookware


Hy Cite is a prominent player in the multi-level marketing industry specializing in premium cookware.

We delve into the company’s growth from its humble beginnings in a Wisconsin garage to its current status as a global player with impressive revenue growth. The company has built a strong reputation and loyal customer base despite various challenges.

Read on to find out the key aspects that contribute to Hy Cite’s success.

Key Points

  • Hy Cite’s History and Growth: Hy Cite, founded in a Wisconsin garage in 1959, now ranks 24th on the DSN Global 100 List with a $508M revenue in 2022.
  • Business Model: Hy Cite’s direct-selling model involves Independent Distributors who earn incentives based on their sales performance.
  • Product Offerings: Hy Cite offers high-quality, energy-efficient cookware made of T316 surgical stainless steel under brands like Royal Prestige.
  • Legal Challenges and Public Perception: Hy Cite has faced legal issues over safety and sales tactics, yet maintains largely positive consumer reviews.

Section 1 – The Company

This section gives an in-depth examination of Hy Cite, journeying back to its roots and exploring its history, financials, and current market standing. We present impartial and uncensored facts, uncover data and trends, and sketch a comprehensive analysis of the company.


Overview of Hy Cite

Hy Cite Enterprises, LLC is a prominent player in the direct sales sector globally, focused on selling premium cookware to households.

The company is popularly known for its Royal Prestige brand as well as the NutraEase, and Kitchen Charm brands.

Royal Prestige Cookware, owned by Hy Cite Corporation, manufactures a range of premium stainless steel cookware constructed from T316 surgical stainless steel. These products are not available in stores but are exclusively distributed by Independent Distributors across various markets.

Hy Cite is a member of the Direct Selling Association.

Market Performance

Hy Cite Enterprises has demonstrated impressive performance and growth over the years.

With over 1,200 employees and a customer base exceeding 600,000 in the United States and Latin America, the company has established a strong presence in the market.

In terms of financial success, Hy Cite has consistently shown positive revenue growth. On the 2023 DSN Global 100 List, the company ranked 24th, with a remarkable $508 million 2022 revenue. This signifies a steady upward trajectory compared to the previous years’ revenue:

  • 2021 – $423 million
  • 2020 – $341 million
  • 2019 – $306 million
  • 2018 – $275 million
  • 2017 – $253 million
  • 2016 – $233 million
  • 2015 – $195 million
  • 2014 – $178 million
  • 2013 – $164 million
  • 2012 – $159 million

The company operates in the United States, Dominican Republic, Mexico, Brazil, Peru, Colombia, and Argentina, further solidifying its position as a global player.

History

In 1959, while still college students, Peter O. Johnson, Sr., and his friend Dave Johnson laid the foundation for what would become Hy Cite Enterprises.

Their journey began in a humble garage in Madison, Wisconsin, where they ventured into the purchase, warehousing, and distribution of a cookware line, setting the stage for their future success.

During the 1960s, Peter O. Johnson, Sr. assumed sole ownership of the company and took a pivotal step by establishing a Distributor Network in the Midwest.

This move proved fruitful, as Hy Cite experienced rapid growth and achieved $1 million in sales within just a few years.

As the 1970s unfolded, Hy Cite expanded its reach across the United States by developing distributorships in various regions. This strategic expansion laid the groundwork for the company’s continued success.

Today, Hy Cite Enterprises stands as a leading direct sales company specializing in premium kitchenware with annual sales exceeding $400 million.

Hy Cite Enterprises logoPin

The CEO and Top Executives of Hy Cite

Erik Johnson, the Executive Chairman of the Board, has been an integral part of Hy Cite since 1995. He previously assumed the role of President and CEO when his father, the company’s founder, Peter Johnson Sr., retired in 2000. He earned the position of Executive Chairman in 2022.

Peter Johnson Jr., the Vice Chairman, has held various roles within Hy Cite since 1984.

Paulo Moledo, the CEO & President, joined Hy Cite in 2019. His appointment as CEO in early 2022 makes him only the third CEO since the company’s inception in 1959.

Glenn Johnston is the Chief Operating Officer & Chief Financial Officer who joined Hy Cite in 2017.

The Owner of Hy Cite

Hy Cite Enterprises has seen various changes in ownership over the years.

In the 1960s, Peter O. Johnson, Sr. acquired his partner’s share of the company, solidifying his position as the sole owner.

Fast forward to 2013 when Palladium Equity Partners, LLC, a private investment firm specializing in the U.S. Hispanic marketplace, executed a recapitalization of Hy Cite Enterprises. The terms of the investment and shareholding were undisclosed.

Despite the recapitalization, members of Hy Cite’s founding family and management team retained leadership positions within the company. Additionally, David Perez and Luis Zaldivar from Palladium joined Hy Cite’s Board of Directors.

The Hy Cite Headquarters

This company established its headquarters in Madison, Wisconsin at 333 Holtzman Road 53713-2109.

From this central location, the company manages its operations and oversees its 8 corporate offices and distribution centers in the United States, Dominican Republic, Mexico, Brazil, Peru, Colombia, and Argentina.


Section 2 – Business Model

This section provides an impartial, balanced analysis of Hy Cite’s sales system and the opportunity for independent distributors. We uncover the critical aspects that make the company so successful.


How Hy Cite Markets Its Services

The company’s marketing strategy relies on its extensive Distributor Network.

All products are exclusively sold by Independent Authorized Distributors. This sales model allows the company to maintain a personal touch and establish direct relationships with customers.

The key methods employed by Hy Cite’s distributors for marketing and sales are hosting in-home parties and group sales presentations to showcase the quality and benefits of Hy Cite’s cookware to potential customers.

Currently, Hy Cite works alongside more than 5,000 Independent Authorized Distributors and Junior Distributors. These dedicated individuals play a vital role in the distribution and sales of the company’s cookware lines.

How to Make Money on Hy Cite

The company offers its distributors a range of incentives apart from commissions for personal and downline sales.

Hy Cite celebrates the accomplishments of its distributors through biannual conventions held in captivating destinations like Atlantic City, Las Vegas, Orlando, and Washington, D.C. These conventions serve as a platform for recognition, training, and personal development. Attendees also gain complimentary tickets to amusement parks and shows.

Additionally, the Royal Opportunity program offers an Incentive Program that rewards outstanding performance. Distributors can aspire to attain:

  • The Royal Lion Award: Symbolizes excellence and innovation in leadership within the Royal Prestige® community.
  • VIP Trip: Exclusive trips to idyllic destinations, both domestic and international, for high-performing distributors.
  • Draws, raffles, and giveaways: Includes luxurious cars, substantial cash prizes, and exquisite jewelry.

Eligibility for these conventions, trips, sweepstakes, prizes, and gifts is based on the performance of the distributors.

Hy Cite’s Compensation Model Explained (Video)

The Hy Cite compensation model consists of five distinct phases:

  1. Entrepreneur
  2. Junior Distributor
  3. Royal Prestige® Authorized Distributor (level 3, level 2, level 1, Blue Network level, and Royal Network level)
  4. Premier Network Leader
  5. Master Network Leader
Hy cite compensation planPin

The company provides a brief look at its compensation model in Spanish, as seen in the image below:

Hy Cite royal prestige plan (Spanish)Pin

We translated the compensation model to English to give a bit more clarity as seen below:

Hy Cite royal prestige planPin

However, a clearer description of the compensation model is provided on a training video by one of the top distributors as seen in the video below.

We translated various parts of the compensation model to uncover the following details. 

During the Entrepreneur phase, commissions are set at 15%.

You can then advance from the Entrepreneur phase to Junior Distributor status. Three paths are available for this advancement:

  • The Fast Track requires achieving $22,000 in personal sales and $22,000 from the team within six months.
  • The Normal Track sets the requirement at $45,000 in personal sales and $22,000 from the team within one year.
  • The Sales Expert classification demands $65,000 in personal sales.

Transitioning from the Junior Distributor phase to Independent Distributor status requires a different approach. Individuals must make a direct purchase of $25,000 worth of merchandise under their own account, without contributions from company or team sales.

Additionally, certain indicators must be met, such as a repurchase rate below 2%, a sufficient reserve, and limited accounts with delayed payments.

Territory and franchise play a crucial role in advancing within the Hy Cite compensation model. To achieve Blue status, individuals must make $290,000 in purchases, roughly equivalent to $870,000 in sales, and have around 30 active franchises.

Similar requirements apply to higher levels, such as Royal, where the number of franchises and sales targets continues to increase.

One of the highest levels within the Royal Prestige® compensation model is Premier. To attain Premier status, individuals must achieve a team sales volume of approximately $3 million annually, which corresponds to around 4,000 sales and 8,000 demonstrations per year.

Additionally, individuals must have 35 franchises or 100 pans within their territory.

How Much Money Can You Make With Hy Cite?

The company hasn’t published an income statement for its distributors.

However, it’s possible to estimate the average revenue generated by each salesperson. According to the 2021 revenue report, Hy Cite achieved an impressive $423 million in revenue. By dividing this revenue by the number of distributors in that year (5,000), we find that the average revenue per salesperson is approximately $84,600.

The company does provide some estimates of what distributors can potentially earn.

Here is an overview of the starting levels:

  • Starting as an Entrepreneur, individuals can earn up to $300 per sale. It typically takes around six months to advance to the Junior Distributor level.
  • Junior Distributors who are promoted to the Distributor level can earn an average of $1,839 per month. Within 11 months, 44% of Junior Distributors ascend to the Distributor level.

The Royal Prestige® Authorized Distributor hierarchy consists of different levels, including level 3, level 2, level 1, Blue Network level, and Royal Network level. The average annual earnings for:

  • level 3 – $33,753
  • level 2 – $74,459
  • level 1 – $100,384
  • Blue level – $74,254
  • Royal level – $125,624

The company states that, on average, it takes around nine years to progress through the Distributor phases 3, 2, and 1 and reach the Blue Network level. Moving from the Blue to the Royal Network level typically takes approximately four years.

Finally, here is an overview of the top levels:

  • There are over 50 Premier Network Leaders and their average annual earnings amount to $211,995. Transitioning from the Royal Network to Premier Network Leader usually takes around five years.
  • Over 15 Master Network Leaders currently exist, earning an average annual income of $401,228. It takes an average of eight years for Premier Network Leaders to reach the esteemed Master level.

It is important to note that the timeframes and earnings mentioned above are averages and may vary based on individual efforts, performance, and market conditions.

The Cost to Join Hy Cite

According to information provided on Hy Cite’s official website, aspiring distributors can embark on their entrepreneurial journey without an initial investment.


Section 3 – Products

This section delves into Hy Cite’s product offerings. We identify the features that set them apart from the competition and the value or advantages they bring.


What Hy Cite Sells

Hy Cite offers three key cookware brands: Royal Prestige, NutraEase, and Kitchen Charm.

The Royal Prestige cookware line stands out among these brands. It’s manufactured with T316 surgical stainless steel for durability and performance. Here, the Innove line is marketed as offering waterless and greaseless cooking, while the Novel line allows for oil, grease, and fat-free cooking, promoting healthier culinary practices.

To acquire Royal Prestige Cookware products, interested customers can submit an online form on the Royal Prestige website, and the company will connect them with a local distributor. The cookware is available for individual purchase or as combined sets. Notably, the cookware is suitable for gas, electric, or induction cooktops and can be used in ovens up to 400 degrees.

Prices for their cookware sets typically range from $2,000 to $4,500.

In addition to cookware, the company’s products extend to cutlery, tableware, appliances, accessories, and filtration systems.

Among their best-selling items are the NOVEL™ Cooking Systems, 5-PLY Cooking Systems, INNOVE™ Cooking Systems, Royal Prestige® Deluxe Easy Release cookware, and the Royal Prestige® Juicer.

Unique Features of Hy Cite’s Products

The standout features of Hy Cite’s cookware are the 316L surgical stainless steel cooking surface and 5-layer construction as seen in the Royal Prestige® Innove™ Cookware, to enable a waterless and greaseless method of cooking, as stated by the company.

This is aimed at maximizing the retention of nutrients and flavors in vegetables and reducing the need for excessive oil when frying.

The inclusion of the Redi-Temp® Valve is also designed to enable cooking at lower temperatures, promoting healthier meal options.

The 5-layer construction is aimed at producing an even heat distribution, in order to cook faster compared to traditional cookware, saving time and energy in the kitchen. Plus, the Silichromatic Ring, provides airtight cooking to retain more nutrition and flavor.

Other features include the Royal Prestige® Moisture Control Window to monitor moisture levels, detachable and heat-resistant handles, trivet lids, and a 50-year warranty.

How to Buy Hy Cite’s Products

Hy Cite provides various payment options. The first option is immediate payment through credit cards, checks, or cash. And the second option involves financing.

The financing process begins with the client signing three papers: the purchase order, the financing plan, and a document containing personal information and references.

Hy Cite considers the client’s income which influences the financing amount. Credit history also plays a significant role.

The payment period commences from the day of contract approval. The first installment, bearing interest, is due between 35 and 40 days from the start. Interest accrues throughout the payment period, calculated on a daily basis.


Section 4 –Doubts and Misconceptions about Hy Cite

This section will reveal some essential elements surrounding Hy Cite in order to assist you in making an informed decision about the products the company provides.


Lawsuits and Independent Reviews of Hy Cite

Hy Cite Enterprises has been the subject of several lawsuits and negative reviews concerning product safety, deceptive sales tactics, and misleading income claims.

In 2013, Hy Cite issued a voluntary recall of the Royal Prestige 9-Ply Thermal Wall Cookware. This recall affected approximately 1.7 million units due to the cookware’s tendency to collapse, crimp, or deform when exposed to heat, posing a burn and fire hazard.

The company had received over 1,100 reports of incidents, including instances where consumers were spattered with hot oil when the pan collapsed while cooking.

Moreover, a 2017 investigation by TINA.org revealed that a significant number of direct selling companies, including Hy Cite, made false and unsubstantiated income claims to promote their business opportunities.

These misleading claims were made either directly or through distributors.

In 2009, Hy Cite settled a lawsuit filed by the California Attorney General’s office, which accused the company of using deceptive in-home demonstrations and scare tactics to sell its high-priced cookware.

The settlement required Hy Cite to pay $350,000 in restitution to consumer victims, and $100,000 of the restitution remained unclaimed. The company targeted predominantly Spanish-speaking consumers in Southern California, using high-pressure sales tactics and false claims about the safety of their competitors’ products.

Other legal actions involving Hy Cite include a judgment in 2000 by the San Francisco Superior Court, which found the company guilty of unfair business practices and prohibited them from engaging in misleading sales.

Additionally, in 2002, Hy Cite paid $1,000, when the Nassau County filed papers alleging that the company engaged in deceptive trade practices, but did not admit to any wrong-doing.

On the other hand, consumer reviews and ratings give a more positive reputation. On ConsumerAffairs, the company has an average rating of 4.1 out of 5 stars based on 1,092 reviews.

The Better Business Bureau rates Hy Cite as an accredited business with an A rating, although it averages 3.07 out of 5 stars based on 195 customer reviews.

Where are Hy Cite’s Products Made?

Hy Cite indicates that several of its Royal Prestige brand items are manufactured in Italy.

Italy’s reputation for excellence in craftsmanship and attention to detail aligns with the Royal Prestige brand’s emphasis on producing premium products.

Can You Put Royal Prestige Pans in the Oven?

According to the official support page of Royal Prestige, these pans can indeed be used in the oven.

However, it is essential to follow specific guidelines to ensure optimal performance and safety. Before placing the cookware in the oven, it is advised to preheat the oven completely. Additionally, it is crucial to avoid using temperatures higher than 400°F/ 205°C.


Section 5 – FAQs and Recap

In conclusion, we summarize some key concepts by answering frequently asked questions about Hy Cite


What is Hy Cite?

Hy Cite is a global company in the direct-sales industry that specializes in selling premium cookware. They are known for their brands Royal Prestige, NutraEase, and Kitchen Charm.

What products does Hy Cite sell?

Hy Cite offers premium cookware made from surgical stainless steel, as well as cutlery, tableware, appliances, and filtration systems. Their flagship brand, Royal Prestige, promotes healthy, energy-efficient cooking.

What is Hy Cite’s business model?

Hy Cite uses a direct selling model where Independent Authorized Distributors exclusively sell their products. Distributors are incentivized through conventions, awards, trips, and other prizes based on their sales performance.

Has Hy Cite faced any legal challenges?

Yes, Hy Cite has faced several lawsuits over product safety, deceptive sales tactics, and misleading income claims. Despite these challenges, they have maintained a largely positive reputation among consumers.


Sources

Credits (Images)

Author: Victor Nyorani

Victor Nyorani - Network Marketing Start

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