NO.
More below, or choose another question here:
In general I find almost all MLM companies to be unworthy of attention. We have added a few items to our price list which are sold by MLM companies. For these products we offer them for sale, just like our "regular" vitamins, but we never spend much energy to encouraged people to "sign up" and become distributors for those MLM Companies.
We note with sorrow that most people who get involved in a health product MLM don't stay with the product more than a year! We've been selling the same vitamin formula for more than 20 years! We've never run into the common MLM problem of promising all sorts of hype, and then not being able to deliver it on a long term basis.
So, we continue to carry some products from MLM companies, but only because we think the products are great. We don't push the recruiting thing much. Don't get us wrong. We don't turn them away, but we just don't push them.
We've found much more satisfaction with being in complete control of the manufacturing process for our vitamins, and depending on a central source of information for our marketing.
So, I do not encourage you to get into some MLM company.
Let me lay out for you some simple marketing concepts.
For any product being sold the public you have some costs of manufacture, then there are sub-costs such as storage and transportation, and others. But, as big as "manufacturing costs" are, there two other comparable costs. These include the cost of "administration" and the cost of "marketing."
The only area where MLM's are very different from other companies lies in their approach to marketing costs. They may claim to have different costs of administration, but that is generally just more hype.
Marketing? The MLM's will tell you that they don't spend expensive money for advertising like other companies. Let's look.
Most companies will spend somewhere between 20% and 30% of the gross sales dollar on advertising. Some, like Revlon, sell a waxy substance (lipstick) that costs an actual $0.05 to make, and $0.25 for the tube, for, say, $5.00. They also typically spend as much as $2.50 per tube for advertising. It just happens that cosmetics are so alike, from one to the next, that the differences have to be created through advertising. So, one lipstick will promote itself with ads showing blondes while another brand will ads showing brunettes. I joke, but this is basically true.
The cosmetic companies have
learned that they can sell this tube for $5.00 if they spend $2.50
per tube for ads. So, they do it.
But, most products, such as vitamins, household products, clothing, food, do not involve advertising costs this high -- the 20% rate for advertising is usually accurate.
I suggest that MLM companies will have manufacturing costs and administrative costs that would not be much different if they sold through more typical marketing channels -- stores.
So, MLM companies replace that advertising and sales cost with a cost of the distributor program.
Some MLM companies will freely admit the total of the gross sales dollar that they allocate to the distributors -- others try to hide the actual figures. There are very few MLM companies that don't allocate at least 50% and more often 60% of the gross sales dollar for the cost of this distributor structure.
The "gross sales" value for an MLM is almost always a completely fake figure of "list price" which hardly anyone ever pays -- but use it anyway. So, this MLM product would have a suggested list price of, say, $10.00 each. Since 60% of that price is usually used for the distributors, that means that the home office receives $4.00 for every product sold. Since administrative costs are very often an average of 15%, you would be down to about $2.50 left for manufacturing costs
I could go on, but the simple truth is that any firm that sells a product with a 60% marketing cost will have a tough time selling the same product being produced with a 30% marketing cost. The MLMs will complain about my facts, but if you check around, you'll find they are very accurate.
In order for an MLM to convince people to buy this thing with very high costs they usually only do well when they can claim that they have a patented product, or a proprietary product, where there is no competition. 4Life Research is just such a company. With such products there is no price competition and you cannot find the product somewhere else at a lower price.
MLM's, also, have a clever way around the laws that prohibit price-fixing. First, as I said, no one pays the "suggested retail price." So, most people, if they want the product at all, will "sign up" as a "wholesale distributor."
While the entire distributor network will receive about 60% of the theoretical sales dollar, the low-level distributor normally gets only a 20% commission, based on suggested retail (or a larger percentage based on an arbitrary "business value" amount). So, he buys at wholesale, but for him the wholesale on that $10.00 item would be $8.00. In fact, there would not be any one distributor who gets a 60% commission since the commission is spread out among many distributors.
Yes, indeed, in a distributor network of 10,000 people there may well be one person who is earning $1,000,000 per year, but there would also then be 9,500 who are earning less than the minimum wage. These are the enthusiastic suckers who buy literature, and pay for samples, and attend meetings -- investing many hours per week to make a $10.00 commission. They don't last long, of course. The distributors further up are better at the job of recruiting, so they earn more and keep recruiting new people to feed into the profits of the very few at the top.
It is very much like a drug addiction. It is not logical, but it certainly is emotional. You find people who, like yourself, have swallowed the hope. Hope is not a bad thing, but the false promise of certain success is the stock in trade of those recruiters.
Oh, they will fill their lectures on warnings. They say, "You must work hard to make big money," but they can say that 100 times, and only mention once the paycheck of the top guy -- the people below live on empty hope and dreams.
One proof of this is the term, "MLM Junkies." These are the people who have been involved in 12 MLMs over the last 5 years -- they are always enthusiastic about the current one, or the next one, and they always have someone to blame for their failure in the last one.
These people will not see the truth of what I write -- I have been among those many times. I have joined many MLMs and have made "good" money for one or three months, but somehow, or some other way, it just didn't work, and I went on to the next one.
They all do that. Even those at the very top -- those making $1,000,000 per month? If you investigate them you'll find that THEY jump from one to another MLM. They, of course, blame the home company.
I get so many deceptive messages to come look at (lie, lie, lie) from MLM companies that I have decided to start a roster of them -- click here for Coral Calcium.
Here for Seasilver.
Here for the curious Q2 Machine.
I got into Microhydrin, and Royal Body Care because I thought it was a good product. I even got excited about being a successful MLMer, back then. Click Here for my ideas back then. I liked that company less and less as time went on. We still have their stuff for sale. I suppose it is OK, but I would never recommend you get into it for the purpose of making money
HERE is another MLM fraud. I could write about hundreds of them -- I generally only investigate when I've received several letters asking for my opinion.
HERE is what I've written to explain why no MLM has ever had an honest oral chelation product for sale!
Here is message I get all too often:
Karl, would you please listen to the tape I've sent you? The product is a miracle!
I will never listen to a tape that way. HERE.
Even when an apparently ethical company, like Amway, sells Vitamin C, they resort to psychobabble and lies to make it appear that they have a reasonable product. Amway, of course, is MLM. Click Here for their super-duper Vitamin C.
Here are the mechanical barriers an MLM company has to overcome.
The conclusion includes that ALL MLM companies MUST sell their products at far higher prices than any other source for the same material. They are inherently a very inefficient method of distribution.
They seem successful ONLY because they either do HAVE truly unique products that are not available elsewhere, like 4Life Research, or they trick you into thinking their product is unique when it is not, or, worst of all, they trick you into thinking the product is good when it is a complete flimflam.
They tend to continue in existence only because a very large number of suckers get excited and "work" at a "pay" of less than $2.00 per hour while a very, very tiny number of top distributors make really big bucks. The people making $2.00 foolishly believe that they will soon be making the big bucks. About a year of this foolishness is enough, and they quite -- they haven't learned, and so jump to the next one. I have done this, myself, so I know of whereof I speak.
Don't get into one in order to "make money!"
And, most of them do not offer a product worth the money.
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