network marketing

Is Optavia A Pyramid Scheme? 2022 MLM Review

Is Optavia A Pyramid Scheme? A Truthful MLM Review

 

Welcome to Optavia. This is where you start your personal transformation. Otherwise known as weight loss!

The questions are simple?

Is Optavia a pyramid scheme and is Optavia an MLM? The answers are No and yes, respectively. This is from an independent perspective.

Ask someone who lost money or has a complaint against Optavia, then they are automatically a pyramid scheme. I call it the P card. When in doubt, throw the P card.

It is, how a lot of people, try to end an argument or debate about a company in the MLM industry.

In this article, we will dive into what makes Optavia an MLM and why it isn’t a pyramid scheme.

 

Optavia Products

 

Optavia is no different than any other health and wellness company. They have meals and meal replacements. They call their products a fancy name to differentiate them from other meals and health products.

 

They call their products fuelings and they are recommended by a health coach – another name for your upline! Fancy.

 

One of the biggest complains is the cost of mlm products. Let’s see how Optavia Shakes stack up against other brands!

Select Dark Chocolate Covered Cherry Shake – Very Fancy        $3.46 per shake

 

The Man Shake meal replacement shake – Not fancy                    $2.49 per shake

 

Rapid Weight Loss Meal Replacement Shake – So So                   $3.92 per shake

 

Slim Fast –  Been around forever                                                     $1.51 per shake

 

The last three can be found at my local grocery store and/or Walmart.

The cost is not so far out of the range of a normal range as to spark complaints. After all, nobody is forcing people to buy this suff!

 

Is Optavia an MLM

 

Yes, it is, by the very definition. An MLM is a business model whereby you, as a distributor, can get paid for the sales of people on multiple levels. If it were just one level, it would be considered affiliate marketing.

Instead of buying pricing TV ads and radio spots, MLM’s pay their advertising budgets to the people spreading the word about their products. This is why mlm’s can pay on several levels down.

To start your Optavia business, it costs $199.00 for a business kit. This has your standard literature and 12 month access to your individual site.

People may complain about that, but it does cost money to get replicated sites and provide materials.

 

The Optivia Compensation Plan

The Optavia compensation plan is pretty simple….not!

I got lost after the first chart:

You can download the whole “integrated” compensation plan here.

One thing I did note, you have to have 5 customers that make an order to qualify for anything!

That is a switch to most MLM’s where they require zero retail customers.

 

Plus, your personal orders count for nothing. This is a good thing so that people do not “garage qualify” and then they end up on anti-mlm sites complaining how they were burned.

 

They continue with the typical ranking systems and incentives like most mlm’s. Look at this craziness!

 

Is Optivia A Pyramid Scheme?

It is not. In order to be a pyramid scheme:

  • You Get paid only for recruiting people
  • You have a high start up cost
  • There is no retail trade

 

Based on the facts on their website, it is not a pyramid. They actually make it pretty tough to earn money with the 5 customer rule.

There is no inventory loading and $199 for your kit, which includes a website, is pretty good.

All in all, you have to be pretty switched on to make some decent money in this company. On the flipside, I don’t see where you can lose more than $199 bucks.

Your personal orders are for you so you get the benefit. Stocking up on things does you no good and nobody is forcing you to buy anything.

 

Is Optavia a pyramid scheme? No

Is Optavia an MLM? Yes

I believe people need to go into these businesses knowing that you have a sales role. Period.

And if you fail, don’t play the P card!

 

Cheers

Steve

 

Is Young Living A Pyramid Scheme?

Is Young Living A Pyramid Scheme?

 

Young Living Essential oils was founded in 1993 and has become a major player in the health and wellness business category.

 

Gary and Mary Young started their first farm and distillery in 1994 and distributes essential oils internationally.

 

Young Living comes in at #9 of the top MLM companies list in 2021 with 2.0 Billion in Revenue.

 

Just as a reminder, an illegal pyramid scheme contains some of these characteristics

 

  • You cannot make more than the person who sponsored you
  • You only get paid to recruit
  • No product exists or no product is being sold
  • Commissions are based only on recruits
  • Large sign up fee or front loading of inventory
  • There should be a strong retail aspect – Gaining customers

 

 

HOW TO SIGN UP IN YOUNG LIVING

 

This sign up discussion applies only to the USA signups

 

Preferred Customer:

 

You can sign up to shop Young Living products and enjoy member rewards.

 

Once you enroll another person, you automatically become a business member.

 

They are calling a business builder a Brand Partner on their web site. It does look like you have to buy a small business essentials kit for $29.95

 

This gives you company literature and some goal tracking papers.

 

You do, however, have to earn 100PV to get 24% off all products. This equates to about $165.00

 

So all up, it is still under $200 USD to get started in Young Living.

 

This is far below the threshold of a typical pyramid scheme.

 

 

HOW YOU GET PAID IN YOUNG LIVING

 

Beyond the fast start bonuses, trips, and other periodic incentives, Young Living’s compensation plan is based on a five level payout.

 

You earn a percentage of all the group volume in each level – 8% 5% 4% 4% 4%

 

There are 7 qualification levels and you only get paid down 5 levels hen you reach the 4th qualification (Executive).

 

This “unilevel” method of payout is typical of many other MLM’s.

 

In order to get paid, you must personally purchase 100PV of oils per month. (about $165).

 

One of the key factors I look at when analyzing compensation programs is the ability for a person to earn more than the person who enrolled them.

 

If that cannot happen (as in the corporate world), it is definitely a pyramid scheme.

 

In Young Living, I could personally enroll more people than my enroller and based on the compensation plan, I will earn more money. The plan rewards you more for personal enrollments than group enrollments.

 

Nowhere in the compensation plan do I see any payment for simply recruiting someone. The closets to it would be their fast start bonus. But that is based on volume purchased, although some critics could try to twist it!

CLICK HERE for Young Living Compensation Plan PDF

 

RETAIL FACTOR

 

Unfortunately, there are not retail sales requirements in Young Living. It goes against the FTC’s 10 customer rule established when they investigated Amway. There is no requirement from the FTC, but they do take that into consideration if an investigation is launched.

 

Young Living members can (and do) sell to retail customers. I was a retail customer for a long time before becoming a member. This is the way most members start. According to Young Living, about 89% of their members are in it to get a discount on their own oils and make some sales along the way.

 

 

CAN YOU MAKE MONEY IN YOUNG LIVING?

 

The simple answer is YES. The practicality is, most do not. In fact, in 2021, the average gross annual income of 89% of their members was only $3.

 

I have personally coached a few people in Young Living and have about 50 or so tax clients in Young Living. The key is finding people who like the benefits of the oils. I would say 1 out of 4 people will do something with the business. The 3 out of 4 will either be retail clients or members.

 

The fact is that the oils are high quality and high priced. They do have benefits and I would not classify this as a pyramid scheme.

Let me know your thoughts in the comments!

 

Cheers

Is MLM A Pryamid Scheme?

Is MLM a Pyramid

 

Ever since Amway started in 1959, the world has targeted them and all other mlm’s as pyramids.

 

Let’s have a deep dive into this subject. I believe the MLM has gotten a bad rap due to some bad apples and a ton of misinformation!

 

WHAT IS A PYRAMID?

 

Beyond the geometrical definition, a pyramid is a business structure wherein one person is at the top and each level below people are added into smaller pyramids. The premise is that each person keeps recruiting others and they keep recruiting and so on and so on.

 

Based on popular opinion, the person at the top gets compensated on everybody below him. Then each person below him, gets compensated for the people below him, and so on.

 

The term Multi-Level Marketing is derived from this structure where people are positioned below other people. The term pyramid only really refers to the shape of the structure.

 

WHAT MAKES IT ILLEGAL?

 

The simple explanation of an illegal pyramid is a business structure whereby people ONLY get paid for recruiting others and you can NEVER make more money than the person who recruited you.

 

That is the basic test of is it legal or not.

 

The Amway Corporation went through a rigorous lawsuit in 1979 by the FTC regarding accusations of operating an illegal pyramid scheme. Amway won the battle and here’s why:

 

  • Distributors were not paid to recruit people
  • It did not require distributors to buy a large amount of inventory
  • Distributors were required to maintain 10 retail customers
  • The company had to buy back excess inventory if requested

 

Another red flag is if you have to pay a “sign on” fee to join a company. This sign up fee should be no more than $100. Amway has none to be a distributor. Prepaid Legal (now known as Legal Shield) had some problems as the were asking for $495. This money was paid to upline people (your sponsor and people above him) as a “training” bonus. However, very little training was done and, in reality, it was a recruiting fee. That’s what stung Pre-Paid Legal.

 

ARE CORPORATIONS PYRAMIDS?

 

Technically, yes! Think about it for a moment. In the picture below, you will see the layers (or levels) of a corporation. What does it look like? A pyramid!

 

Now, I do not remember from my corporate days and employee at the bottom EVER making more than the CEO. Nor do I believe it would ever happen.

 

It’s interesting that the same people who put down multi-level marketing companies work for a pyramid!

 

 

CAN I REALLY MAKE MORE MONEY THAN THE TOP GUY?

 

Yes, I believe you can. First off, many people come into and out of MLMs. There is usually no one person sitting at the top of everybody involved. The company itself adds/sponsors/recruits people into the company and then builds another team from there. They do this because a true pyramid structure would collapse under any compensation plan.

 

I’ve been involved in several MLM’s over the years. The first was Amway of course and then several after that.

 

I joined a company called Eniva and I set out to prove once and for all that I could make more money than the person who sponsored me.

I recruited personally and helped other on my team over 500 people in one year. I also retailed many bottles of the VIBE, that I still use to this day!

 

And guess what? I made more money each month than the person who sponsored me. I also stopped recruiting and selling after that year and I still got a referral check for 6 years after based on the sales and recruiting of the people that I brought in.

 

In order to really prove this to yourself, you should study the compensation plans of any company that you are considering. The basic concept is that a company cannot, and does not pay to infinity. This alone proves that you can only make so much from this structure and people below you can make more.

 

THE BIG LIE

 

Misinformation is everywhere. It is part of free speech. I can say almost anything I want until I make a false claim or I damage someone.

 

The MLM industry, still to this day, continues to have people say it is a pyramid scheme. I guess companies like Amway, Mary Kay, and the like just don’t have the time nor energy to sue people.

Pyramid scheme Lularoe has been the most recent to come under scrutiny. Their big problem was the massive inventory required. Other than that, it seemed to be ok. I have to do some more investigation into it.

 

Take the time to sift and sort through the information and you will find that 99% of the companies are legitimate. It’s always the bad apples that spoil the bunch!

 

Cheers

Top 10 MLM Companies for 2022

The Top 10 MLM Companies for 2022 – USA

#1. Amway

Amway has been number 1 in the USA for well over 10 years now and even possibly beyond. Founded in 1959, they have enormous brand power and sell every form of consumable you can imagine. Brands include Nutrlite, SA8, and many others. They lead the pack with $8.9 billion USD in revenue for 2021.

#2. Herbalife

Another oldie but goodie, Herbalife was founded in 1980 and boasted $5.80 billion USD for 2021 revenue. Once again consumables , particularly supplements, are a big portion of their sales.

#3. eXp Realty

Started in 2002, eXp Realty grew to $3.8 Billion USD in revenue in 2021. It was a growth leader from 2020 at 111% increase. This company is a real estate brokerage firm that uses a revenue sharing model which is a bit different from the traditional MLM models.

#4. Avon

Believe it or not, Avon has been around since 1886. 2021 revenue $3.4 billion USD. The primary products are consumable cosmetics. They have ventured out into a bigger catalog adding a glassware collection and alot of knick knack (showing my age) items.

#5. Primerica

One of the first financial services MLM’s, Primerica comes in at $2.71 billion USD in revenue. Started in 1977, it was initially just insurance but now has expanded to a full service financial service company.

#6. Melaleuca

Not far behind Primerica, Melaleuca is at $2.70 billion USD and was founded in 1985. One of the first essential oil companies, they concentrated on Melaleuca oil until expanding into other oils and a line of household products.

#7. Nuskin

Despite lawsuit problems in 2016, Nuskin still is in the top 10 at $2.69 billion USD in revenue for 2021. Skin care and supplements are the primary products. They were the first to come out with a Biophotonic scanner used to tell if your supplements were actually working.

#8. Mary Kay

Yet another oldie but goodie, Mary Kay started in 1963 and continues to be a well recognized brand in America. 2021 revenue comes in at $2.60 billion USD. Cosmetics has been the staple product from day one. It appeals to many women who want the pink cadillac experience. It is one of the easiest companies to earn a free car.

#9. Young Living

Otherwise known as Young Living Essential Oils, it was founded in 1993 and produces high quality essential oils used for a range of ailments. Revenue for 2021 was $2.0 billion USD. Young Living has very loyal distributors and now is in a rivalry with Doterra! CLICK HERE for detail on Young Living

#10. Forever Living Products

Rounding out the top 10 is Forever Living Products, a privately held multi-level marketing company based in Scottsdale, Arizona, which manufactures and markets aloe vera-based drinks and bee-derived cosmetics, dietary supplements, and personal care products. 2021 revenue was $2.0 billion USD.

That wraps up the top 10 mlm’s for 2022. All but 2 experienced positive growth from 2020 to 2021. What will be interesting is to see the growth (or decline) from 2021 to 2022 considering the pandemic! MLM’s tend to increase during tough times. We will see.