Why MLM Companies Are the Absolute Worst
Anti-MLM Basics – What is an MLM scheme?
MLM stands for multi-level marketing. They are also referred to as Network Marketing companies, direct sales, or even pyramid schemes by the federal trade commission (FTC).
MLM schemes are nothing new. In fact, many of these companies have been around for well over 40 years! In fact, nearly 20 million Americans admit that they have been involved with or approached by an MLM at some point in their lives.
That’s just something we all can’t ignore anymore. So if you’re approached by sales reps from the following companies: Herbalife, Avon, Amway, Arbonne, or Pampered Chef…
Run for the hills.
MLM reps don’t receive a salary…full income disclosure. Compensation plans for these distributors are based on how much they sell.
Strictly commission baby!
And here comes the shady part:
You only get your commissions if you hit your quota for the month!
That means you could be just shy of your quota, have worked your ass off ALL MONTH, and get absolutely nothing in return!
To make matters even worse, to help yourself make money, they encourage and damn near force you to go recruit others to buy into to the same BS dream you did.
As you can probably tell we’re pretty heated on this topic…We just hate the idea of people getting sucked into this crap!
You see, to get started with this “business opportunity” you are FORCED to buy their products in bulk in the form of a “starter kit”. Some of these kits can cost THOUSANDS of dollars.
Now, they all claim that you’ll make your investment back when you sell it all at “market value”…
But everyone with half a brain knows that retail sales offer products that are just as good and much cheaper. It pretty much makes no sense to buy an MLM product because of how expensive and low quality they are.
In an MLM you are taught to recruit and to recruit heavily. Essentially you just recruit 10 people, then those 10 recruit 10 more people and so on. Following that pattern you grow what is called your downline.
This is where most of the money is actually made. You basically just receive a small percentage of sales from all the people underneath you.
Those at the top make the money, those at the bottom don’t. Now can you see why MLM’s are synonymous with the term pyramid scheme?
Now they might argue that it’s no different than a CEO at the top bringing home a lot of the money…but one little detail they leave out is that in a legit company, people are guaranteed salaries, benefits, and aren’t having to recruit 24/7. Plus a job actually makes you money whereas most people in an MLM report LOSING MONEY!
Wouldn’t it be great to bring some REAL VALUE to society by helping real business owners?
What Are the Worst MLM Companies?
Look, all MLMs suck. That’s why we’re putting together this article. But below we have gone ahead and listed some MLMs that are some of the WORST. These companies have had lawsuits, run ins with the FTC, and are just downright shady.
The worst MLM companies include:
- LuLaRoe – They have over a dozen lawsuits and require women to pay $6,000 just to join!
- Herbalife – You know it’s bad when the FTC actually had to mail checks to over 350,000 who lost money selling Herbalife products.
- Monat – This supposed hair care company has several lawsuits due to peoples hair falling out.
- Jeunesse – They are a skincare MLM that has a billion dollar lawsuit against them for being a pyramid scheme.
- doTerra – They push essential oils in replacement of actual medical treatments.
- Amway – Notorious for all the cases in numerous countries claiming it a pyramid scheme.
- Younique – BS makeup products pushed by people with no professional makeup experience.
- Arbonne – overpriced makeup MLM that preys on women and their desire to be independent.
Want some more content on terrible MLM companies? Check this out!
Why We Will Never Recommend A Friend To Join An MLM
1. Nearly All People Lose Money
Does anyone actually make money from MLM schemes?
Let’s take a look at what the FTC found according to their study.
After looking at 350 MLMs under a microscope they that LITERALLY 99% of people who joined multi level marketing companies lost money. This isn’t a stat for just the worst ones, but rather ALL MLMS!
This doesn’t mean that the 1% are rich either…all that 1% means is that they didn’t lose money.
If you don’t believe us, take a look at the income disclosure statement the MLM you’re interested in provides.
Take Arbonne for example: of the 99% that aren’t losing money with them, the average ANNUAL income of those in the positive is only $839. This total doesn’t include expenses so the profit is even less!
Direct selling reps in It Works make only $47 a month. Basically just a tank of gas…
Now just imagine how different your life would be if you had an asset working for you on autopilot while it brought in $839 per month at a 90%…Check out how you can do exactly that HERE!
And just to be clear, these income disclosure statements from MLM companies are INDUSTRY AVERAGED numbers. Some do better, some do far worse. But overall we can agree that $800 for a year is not a livable wage and far from the beach life you were promised.
2. MLMs Take You Away From Family and Friends
As a network marketer, you will quickly become annoying as the reality of your mistake sets in. You will constantly nag your friends and family, maybe even your random social media followers to buy from you. All so you can make a measly $5 commission.
Come on, admit it. You’ve seen your friends post endless promotions on their pages. Or, if they’re not pushing those products…they’re shoving the fake lifestyle in your face.
Let’s be real, do you really want to be known as that “guy” or “gal”?
Seriously, who wants to be known as the person who recruits people at their darkest hour? It is downright disgusting to use a cancer diagnosis, terrorist attack, or family death to guilt trip people into buying your knock off products.
And if that isn’t enough to ruffle your feathers…MLMs will encourage you to cut out all the people in your life who don’t support you financially. They will tell you to stop caring about what your friends and family think, insisting that they will never understand and that you’re better off.
Not to beat a dead horse or anything, but MLMs literally manipulate you into thinking that whoever questions the MLM as a pyramid scheme should be dismissed as someone who’s a sheep and a debby downer.
We’ve seen MLMs actually destroy what would’ve been life long relationships.
If you want to focus on building meaningful relationships rather than destroying them…this business model might be more up your alley!
3. MLMs Blame You For Not Succeeding
The system is stacked against you here. Statistically speaking there is a 99% you’ll lose money. But guess what. MLMs to you to blame yourselves for your failure. Talk about gaslighting. What’s worse is that they get you to do this to each other in the MLM community!
Even though they have get rich quick posts everywhere, as you begin to crack under the impossible task of recruiting, your are told numerous things that are depressing. “you aren’t working hard enough” “you need to spend more money on such and such training”. Not one lick of positivity or anything encouraging. Just blame on yourself.
Those that give up because of the insane amounts of debt they accumulated are shunned forever by the community and told that they just never had what it takes to actually be successful. Talk about fake friends…
For real friends and family, find a business model that has real support features in place.
4. You Are an Glorified Sales Rep, Not a Business Owner
One of the reasons we hate MLMs here so much at Scamrisk is because these network marketing “professionals” love to call themselves business owners.
At best you can be an independent contractor, and while you’re not exactly an employee…you’re far from a business owner.
When you work in an MLM, you don’t get to set your price, you don’t get to choose your products, you don’t get to choose your margins/profit, and you don’t get to pick the name of anything. A real business owner CAN do those things. Inside an MLM you CAN’T
Face it. You’re just a glorified sales rep!
5. MLM Schemes Prey On Weak People
MLMs and Pyramid Schemes prey on people they believe to be desperate. This tends to be your stay at home moms, college students, and those with a disability. Why? They all want to be able to make decent money from home without having to put in too much work.
Take stay at home mom’s for example. They know you feel guilty about not contributing to the household income, and that you’re lonely and desiring some company of those your own age. MLMs position themselves as the solution to both of those problems. People fall for it hook line and sinker.
It’d be one thing to recruit vulnerable people that you can actually help, but it’s a whole other thing to recruit someone into an “business opportunity” that they will statistically fail, where you get paid by them joining the MLM and they don’t. On top of that, you are never transparent that as a recruit, they will make less than you. In our eyes, you’re the same as the dude sitting at the top of the network marketing scheme.
If you’re after a business model that is LIFE CHANGING…check out how Simon earned his way to 6 figures in just 90 days!
6. MLMS ARE PYRAMID SCHEMES
So if they’re all that bad…why do they still exist today? Robert Fitzpatrick.
Simply put, an MLM company is simply a pyramid scheme that hasn’t got caught yet due to legal loopholes in the system.
The FTC has a pretty good grasp on the difference between a pyramid scheme and multi level marketing scheme.
A pyramid scheme is illegal because it focuses on recruitment and just taking peoples money. A real MLM focuses on selling products that bring value to the market place as well as recruiting.
You know what will really give a dose of reality?
MLM lackeys sell the products to those that they think will join the MLM in the future. Pretty much just a bunch of people from the same company selling to each other…again, now real value being made.
And this is where a lot of these companies get caught. They are just selling to each other and getting more money out of those towards the bottom of the barrel.
For information you can look up the reddit r antimlm for some personal stories.
What Is Our Top Recommendation For Making Money Online In 2023?
Our review team has come across a program in the real estate industry that is next level!
Although it’s not real estate in the traditional sense, it’s all digital.
Where MLMs fall short is in scalability.
There’s only so much time in a day and there’s only so many people you can reach to sell by yourself.
MLM companies know this! Which is why they push so hard for you to recruit for your downline…you can’t get rich with it as a one man/woman show.
But what if you could make even more money off of little local websites without having to spend hundreds of dollars on overpriced products and a bunch of time recruiting people to sell under you?
With this Digital Leasing program, you can make recurring monthly income without constant sales to your friends and constant recruitment!
Sound too good to be true? Of course it does! But it isn’t…in fact, business owners wish they had this skill!
All you have to do is build and rank a LOCAL website and forward the jobs off to a business owner in town, you could even email it to them!
This works for literally any service based business, tree service, plumbing, towing, etc.
How do you get paid and how much?
Simple, after you forward the jobs off to a business owner and he makes some money off of them, you simply ask to make the deal beneficial for each other.
A fair price to charge per lead, depending on the industry is 10-20%…let’s just use the tree service industry for example and go by worst case scenario.
Let’s say you build and rank the site and only 10 jobs a month come in. The average tree service job is anywhere from $500-$2000!
That means at bare minimum you have an asset worth $500 a month!
See why they call it Digital Leasing now? That’s a rent payment.
The great thing is how easy it is to scale. You don’t have to worry about:
- Your upline getting paid before you
- Begging your friends and family to buy from you
- Recruiting people all the time
Remember MLMS? You only get what’s left of the pie if you meet a monthly quota…
The course we recommend actually allows you to collect HUGE FLAT RATE DEALS. Truly passive income!
The training program takes making money online to a whole other level. The owner of the program walks you through how to build and rank a site hand in hand, with the occasional voice over when he is sharing his screen.
You will learn the importance of keywords, website name, how to send call notifications via email, backlinking, etc.
Once the training program is completed you will also have access to a Facebook group much better than any MLM group in our opinion. This group is much more active.
Unlike MLMs, where you’re getting maybe $10 per sale, you could be getting 10-20X THAT.
A business will always want more leads and another job. In fact it doesn’t even matter that the job isn’t coming from their website name or just a demo of what you can do…they see it as it is…expanding Digital Leasing.
Unlike Multi Level Marketing Companies, more people have been able to walk away from their 9-5 job as well.
Digital Leasing allows you to have total passive income with most of your day being spent WITH your friends, NOT selling to them and chasing the top of the pyramid.
Now, I know you probably have tons of questions…