The Utility Warehouse Discount Club has grown to massive proportions, but is this because it is actually a good opportunity? Or is it because their agents are just really good at getting people to sign up and recruiting in other agents?
Is Utility Warehouse Discount Club a scam in disguise?
In this review we'll explore what exactly Utility Warehouse Discount Club is and what all they offer, the business opportunity they provide, complaints, pros v cons and more.
Whether you are just looking to join as a customer or join the business opportunity... read this first.
Utility Warehouse (UW) (aka Utility Warehouse Discount Club) is a brand of the Telecom Plus company. The UW brand was launched in 2002 and has since become one of the largest independent energy suppliers in the UK, with over 600,000 customer accounts and over 40,000 independent distributors. But besides just energy, they also supply a range of other utilities.
The idea is that with UW you can manage all of your utilities on one single bill, and of course get discounts.
There is no big consumer watchdog group like the BBB in the UK, so No they are not BBB accredited, but the company does have a good reputation and the fact that they were named one of the 2018 utility brands of the year reflects this.
Lastly, in addition to the utility services provided they have a business opportunity that anyone can join as an independent distributor to earn money selling UW services and recruiting in other distributors--which is where some of the scam complaints come from.
Broadband and Landline
Their broadband and landline services will supposedly provide you with "guaranteed savings on landline calls". Some of the highlights include:
Landline services start out at £18/mo and the lowest cost Standard Broadband starts at £27.99/mo, which has a download speed of 11Mbps (not very great) and has no minimum contract (now this is good).
They make a big deal about providing free landline and mobile calls to other Utility Warehouse members but I don't see why this is such a great benefit. How often are you really going to pick up the phone and chat with other members anyhow? Probably not much.
Mobile plans run on 4G connectivity and start at just £10/mo, but this only provides 1GB of data, 450 minutes, and unlimited text messages. However, that is very cheap and even their most expensive plan that provides 20GB, unlimited minutes & text messages, is only £25/mo.
There is no doubt the rates are low here, and they claim so much so that they are 70% less than competitors.
In addition to the service plans they also offer a number of iPhones available for purchase through them where you will pay a low monthly fee until they are paid off.
Energy Warehouse also provides gas and electricity at discount prices. They make the claim that their prices are lower than the "big 6" and from what we can tell this has been, and is, true.
However, there are cheaper deals out there from other discount companies that aren't part of the "big 6".
Some highlights of their energy deals include:
One of the most attractive benefits of UW is that you can manage all of your utilities on one bill. They offer 3 different utility bundles that you can choose from, which not only provide you with this benefit but also have some added savings.
With the Double Gold & Gold Energy bundles that provide energy they also offer free light bulb replacement services where they will replace all your home's lights with LED lights typically worth £300 - £500. This is said to be able to save you around 15% annually on your electricity bill.
And, as an added benefit of being a member, you will also be able to save money at over 2,000 retail partners when shopping online.
What I'm talking about here is the cashback program they have, similar to the CoinOut App, where you will get a small percentage of money back (1-4% usually) if you shop at... Argos, Hotels.com, Expedia, Sainsbury's halfords, Thortons, and about 2k other places.
The home insurance offered here has been rated at 5 stars by defaqto and Moneyfacts, and is said to provide an average savings of £115 per year compared to other insurance policies.
Their bill protector service covers accidental death up to £10,000 and also covers utility bills up to £250/mo if you are hurt and unable to work due to something that was not your fault.
The mobile broadband services come with a Pocket Wireless Router and allow you to connect up to 14 devices.
And lastly, some additional benefits of being a member that I will briefly mention include the Gourmet Society Card that can save you money when eating out, and the cashback card that saves you 1% everywhere you used it and up to 7% at over 50 top retailers.
As mentioned, the UW does not run any advertisements and relies completely on an independent sales force to do all the marketing and selling.
Anyone can join the opportunity as an ID (independent distributor) to make money selling UW services as well as recruiting in other distributors.
The cost is £100 or £50 if you join as a customer as well, or if you are already a customer.
This startup cost provides you with training and a Starter Pack, which contains marketing materials for you to get your independent UW business up off the ground.
There are no educational requirements or anything like this to get started. However, new distributors are required to go through free online training provided by UW before they can start earning money.
This training includes the College of Excellence (COE) online training and the Getting Started Classroom online training, as well as the Team Building course that qualifies distributors to earn Group Residual Income.
In addition to the online training, new distributors will also be able to have experienced distributors accompany them for the first 45 days in the real world, which will help newbies gain confidence and experience.
The compensation plan is pretty typical of MLMs. There are various ranks, lots of bonuses and of course there is big incentive to recruit in other distributors beneath you and earn commissions from their efforts.
1. Customer Gathering Bonus (CGB)
The CGB is paid for every new customer that you get to enroll in at least 1 of the eligible services offered, but the more the better.
This bonus will range from £2.50 to £40 depending on the amount of services bought.
2. Fast Start Bonus
Just like pretty much every MLM out there, UW offers a fast start bonus where new distributors can hopefully earn some quick cash.
There are 4 different levels of this bonus (4 different payouts) and you can achieve just some or all of them.
*Gold Customers are people who purchase one of the Gold utility bundles we went over above.
3. Residual Income
The residual income is the income that comes in on a monthly basis from the people that you have personally enrolled as well as those that IDs recruited in beneath you have enrolled. This is where the money really starts to add up and as you grow your business and customers stay with UW.
Example: You recruit in Rob (level 1). He then goes out and recruits Bill (level 2). then Bill recruits Sally (level 3), and so on. This continues down multiple levels.
*The % commissions you will be paid here vary a lot depending on the service.
4. Supporter Bonus (SB)
The supporter bonus pays distributors that assist new distributors in getting customers in their first 45 days.
The idea is that you will get help from an experienced distributors when you join and then you will pay it forward after you have experience of your own.
5. Leadership Development Bonus (LDB)
The LDB gives leaders incentive to support promotions withing their "teams", aka downlines. What this means is that you want to help other people in your downline move up the ranks, which I'll talk about in more detail soon.
6. Promotion Bonuses (PB)
These bonuses reward IDs for reaching higher ranks within certain amounts of time. The higher you go the higher the bonus is, starting at £300 when you reach Team Leader up to £20,000 when you reach National Network Leader.
If you are one of the very few people who are able to climb up all the ranks and earn all of these bonuses you could earn £38,500 just from this.
7. Plus Clubs
If you are able to enroll high amounts of personal customers you will be promoted to Plus Clubs and will earn higher amounts of Personal Residual Income.
There are different levels of Plus Clubs that you can be promoted to starting at 50 personal enrolled customers and going up to 1,000.
Additionally, you will also earn some bonuses, ranging from a simple pin to all expenses paid vacations.
8. Distributor Car Plan
The car plan is designed to help lower the cost of owning a brand new BMW Mini.
You must have an average monthly Residual Income of at least £200 over the past 3 months to quality.
This is a bonus for distributors looking to buy a house. Here UW will provide a loan for a new house of £25,000.
In order to qualify you need to have enrolled at least 40 customers per year for the past 4 years
*If an ID gathers an average of 4 customers per month for the next 5 years after receiving the lone then it will not need to be paid back.
10. Retirement Plan
IDs who make it to the rank of Senior Group Leader and above are able to "retire" from the business and continue to collect Residual Income, which could continue to come in for years and years to come, depending on the activity of your group, aka downline, or course.
Like all MLMs there are various ranks within the company that you can climb up as a distributor, 8 in total. As you move up the ranks you will get more access to the compensation plan and be able to earn more and more money as your downline, aka team, grows and you earn money from them.
How do you move up the ranks?
As you will see below, it all comes down to 3 things:
Next we have the Group Leadership positions. In order to move up to these ranks you will need to focus on team building. The goal is to help others in your team move up the ranks by gathering customers and recruiting in distributors.
Every MLM compensation plan will vary, but they are all the same at their core. It is MLM (multi-level marketing), so the goal is to sell products personally as well as to recruit other distributors in to sell products and build a downline to grow the business.
Every MLM has the basic pyramid structure at its core, where the incentive to recruit more people into the business is that you can earn commissions from their efforts.
There is no doubt about it... Utility Warehouse has a compensation plan with a pyramid structure where distributors earn money by recruiting in other distributors.
However, all MLM's have this basic structure and not all are illegal pyramid schemes.
Utility Warehouse is actually far from being a pyramid scheme and I'll explain why.
The difference between a pyramid scheme and a legit MLM is that the pyramid scheme relies too much on recruitment. A legit MLM's revenue comes largely from real customers buying their products whereas a pyramid scheme (often disguised as a legit MLM) will bring in much of its revenue from recruitment of others into the business and usually forcing them to purchase products.
So, the big question is: how much revenue does Utility Warehouse bring in from recruitment of new distributors... and the answer is not all that much in comparison to the revenue coming in from real customers.
While we don't have access to all the numbers, the fact of the matter is that they have over 600,000 customer accounts and over 40,000 independent distributors, which is a massive difference.
Over 600,000 people have bought into UW as regular old customers... and haven't joined the business opportunity.
So yes, the compensation plan does have a pyramid structure, but this is far from being considered an illegal pyramid scheme. There are many still legitimate MLMs out there, like HempWorx and Avon for example, that lean much further to the pyramid scheme side of things.
That said... don't think because of this it is a great business opportunity. Earning good money isn't as easy as people are often led to believe.
The problem with MLM opportunities is that their failure rates are extremely high. This is due to the very structure (the pyramid) that they have in place, which funnels money from the bottom to the top, usually resulting in only the top few percent making high amounts of money.
Unfortunately Utility Warehouse doesn't publish any sort of earnings disclosure or any distributor earnings statistics. So, we have to look at other sources.
You do find some salaries posted on Indeed from distributors, which claim to earn around £25k per year, but these stats don't give you the big picture.
On Indeed anyone can post their salaries, which is the reason there are so many different job titles listed above.
The problem with this is that it is not even close to being representative of the distributor sales force as a whole. This is particularly true when it comes to MLMs.
In an article published by The Guardian they break down distributor earnings pretty well. The article is a couple years old but there is no reason to believe the stats would change all that much. Here's what they found:
That's not too pretty of a number. Yes, they do provide incentive for veteran distributors to help out new distributors, and they do place a good deal of focus on enrolling customers rather than just recruiting... but the bottom line is that it is still a MLM and numbers like this are not atypical.
BUT... of course this number doesn't take into account all of the distributors that give up to early and just don't really try much.
The takeaway here: Don't fall for the hyped-up promotions of being able to live some extravagant dream life as a Utility Warehouse distributor.
The average rating on Trustpilot for Utility Warehouse is about 4 out of 5 stars... and this is with thousands of reviews left by customers and distributors alike.
So overall the company is well-liked. However, there are complaints.
Some of the complaints on Trustpilot that are actually worth bringing to attention include ones like that shown below, where a customer was pressured into signing up for UW services and experienced terrible reception with their mobile service...
There were also multiple complaints I came across similar to that shown below here, which is about being monthly prices skyrocketing without the consumer knowing...
And there are quite a few complaints about the broadband not being all that great of a service...
However, we don't know the stories behind these complaints so you have to take them with a grain of salt.
For example, the AT&T mobile phone service is absolutely horrible where I live... but does this mean it sucks? Absolutely not... coverage just isn't that great in my area.
Some people complain about broadband, mobile, and their energy services... but the majority don't. Just keep this in mind because sometimes reading a bunch of complaints can be misleading in a negative way.
The short answer is No. They are a legitimate company that provides legitimate services.
But then why are some people calling the place a scam? There are different reasons for this, some of the more notable ones being...
With any MLM there will be pushy distributors that aren't ideal for the company image, but this just happens. And the poor broadband and/or mobile coverage, as mentioned, is going to depend on where you live but generally speaking they seem to provide good quality services in this area.
The complaints from people who claim to have had no idea that rates would go up are the only big concern here... but information about these complaints is lacking.
All in all, UW is far from being a scam.
Okay, so let's do a quick recap here.
Utility Warehouse Discount Club is one of the largest independent energy providers in the UK and provides a range of utilities, which customers can bundle together and potentially save decent amounts of money on. Additionally, they offer a business opportunity in which anyone can join the business as a distributor.
Now whether or not it is worth joining is completely dependent on what you are looking for. Are you looking to save money on your utilities? Or are you looking to earn money with your own home-based UW business?
If you are just looking to become a customer then it couldn't hurt to get a quote and see what you can save. But if you are looking into the business opportunity this is something you are going to want to think long and hard about.
Alternatively, if it is the home-based business opportunity you are interested in, then I'd suggest taking a look at what I do to make money from home... which is something I've been doing since 2015 and it works great.
Anyways... I hope you enjoyed this review and found it helpful.
Comments or questions? I like to hear back from my readers 🙂 Just leave them below...
Is Harvard Risk Management Corporation a scam?
People all over have been getting contacted by this company for sales positions, and this is a question that has been coming up quite a bit.
After doing a quick Google search you will find many people calling it everything from a SCAM that you should stay far away from to a "cleverly disguised pyramid scheme".
BUT, you do have some people claiming it's the real deal... and the fact that jobs with this company are usually advertised as requiring no experience is a big plus.
So is it a scam? Is it a good opportunity?
In this review I did a lot of digging around to get to the bottom of this somewhat shady looking opportunity.
There have been job postings on Craigslist, people getting emailed about the opportunity where the recruiters supposedly "found my resume online" and are interested in hiring them.
There have been job postings on places like Flex Jobs...
... and I was also able to find a bunch of job postings on spammy looking job-boards like "Get Telecommuting Jobs" and "Get Customer Service Jobs"...
The reason I bring this up is because there is a good chance you came across a job posting or were contacted by someone trying to get you to join... BUT these job postings are often very misleading... as you will see.
Harvard Risk Management Corporation is a privately held employee benefits broker headquartered in Dallas, Texas.
In a nutshell, they partner with other companies as a broker and help sell various insurances, legal plans, risk protection services and more. The company was started in 1993 by Mark Riches and originally only sold legal plans, but as since broadened their offerings.
According to the BBB's website, where Harvard Risk Management Corporation is accredited by the way, the company has been in business since the year 2000 (I know, the dates don't make sense). However, a quick WHOIS search shows that the harvardbenefits.com website wasn't started until 2007.
Anyone can join the company as a member and have the opportunity to become an agent (aka "certified risk management consultant"), in which you can make money selling their products/services (which aren't really theirs of course). Currently they claim to have over 5,000 agents in the US, with agents in every major city.
Note: This job posting is also a bit misleading.
As a member of the HRMC you will have quite a few different products/services that you can sell to make money with, including:
But the two main product categories you will be dealing with are identity theft solutions and legal access plans. These are at the core of what HRCM offers.
Remember, these products are not products of the HRMC themselves.
As mentioned, HRMC is a 3rd party broker... and they are currently partnered with the companies Legal Shield and Iron Mountain. The products come from these companies. When you join Harvard you have access to these companies' products/services which you are able to monetize
Legal Shield - This company was originally founded in 1972 as Prepaid Legal. They provide on-call legal advice and counseling from qualified lawyers. Additionally, it provides a MLM business opportunity anyone can join to earn money selling their services and recruiting in new associates.
They also have a product called ID Shield, which is their ID theft protection service. This is one of the biggest products that members of HRMC sell and more information can be found at the website https://www.idshield.com.
Iron Mountain - This company provides data security and storage solutions. They are not a MLM opportunity and have a different kind of partnership with HRMC.
HRMC originally started out just marketing Legal Shield legal plans but added life insurance plans to their portfolio in 2009 and partnered with Iron Mountain in 2012 to bring document destruction and shredding services. They were also partnered with OneCall Health Access to provide telemedicine services and Kroll to provide ID theft protection, but it appears they have done away with these partnerships.
This is independent contractor work, meaning that you work on your own schedule without a boss.
The Legal Shield compensation plan is the main opportunity here, but the point of joining HRMC is to get all the training and tools they provide to help you get going.
*Note: If you were to join Legal Shield directly you would still be provided with training, tools, and support... just not nearly as much.
Supplies, business cards, new agent training... you get all of this by joining through HRMC.
They have over 300 hours of video and audio training available along with a very helpful staff.
And because you are selling legal plans and such, some states will require that you are licensed, in which HRMC will help you with.
There is no cost to join HRMC, but you will be encouraged to purchase an "Agent Start-up Package" (Basic, Standard, or Premium).
However, there is a cost to doing business even if you don't purchase one.
In order to join the Legal Shield business opportunity you normally have to purchase a Legal Shield customer plan yourself and pay a $149 enrollment fee to become an associate.
Legal Shield legal plans start at $24.95/mo.
However, since HRMC is partnered with Legal Shield as a broker, the cost may differ from if you were to just go sign up at Legal Shield directly.
There are no educational requirements or certificates needed to join, but there are some requirements when it comes to selling certain products/services, which will differ depending on where you live.
For example, if you join HRMC and want to sell legal plans (from LegalShield), you may need to be licensed. This depends on your state laws and HRMC can help you find out more on this.
Legal Shield's compensation plan is typical of a MLM. Associates are encouraged to sell legal and ID protection plans to customers as well as new associates, helping to build a team in which commissions can be earned from.
MLM stands for "multi-level marketing", and the "multi-level" part of it comes from recruiting in associates, which then recruit in other associates and so on...
*No, this is not an illegal pyramid scheme. You can learn the difference here.
HOWEVER, the way you get paid as a member of HRMC will differ from regular Legal Shield associates. This is because they are a broker of Legal Shield services.
That said, the basics of the comp plan are still the same:
Since you will be working as an independent contractor there is no salary. You will earn based on your performance.
How much can you actually earn? And how much do members actually earn?
The giant job board/job review site, Indeed.com, shows the average salaries for HRMC sales workers here:
*Note: Indeed gets its data from people posting their salaries and, as stated, from "job advertisements" which can be misleading as I will discuss.
Now if you do the math here, the average of all these salaries equals out to $69,933/yr. The only reason there are many different titles reported above is because these salaries come mainly from people posting how much they have earned... and while one person may consider their title as "salesperson" another worker for HRMC may call themselves a "sales consultant"... but it's all the same thing they are referring to, which is selling the products we talked about above.
Considering that most participants who join MLM business opportunities actually lose money, as discussed in a post I wrote here, the salaries that people who work with HRMC are posting are pretty darn impressive. After all, the main revenue stream here is from the MLM Legal Shield, and according to their income disclosure:
Legal Shield isn't too bad compared to others. Some estimates have been made that as much as 99% of people who get involved with MLMs lose money... yet the salaries from HRMC tell a different story.
This is likely due to 2 main reasons:
1) The Training that Harvard Risk Management Corporation Provides
One of the biggest benefits to joining HRMC is the training. It's like joining a separate community that gives you an extra boost, and it seems logical it would increase chances of success.
As we discussed, they have over 300 hours of video/audio training and a very supportive agent support team.
2) The Salaries Are Inaccurate
While most of the salaries posted are from sales reps posting what they have earned themselves, some of the data may come from job advertisements on Indeed... which causes a problem.
The problem is that job advertisements for HRMC are posted by sales reps looking to recruit new people onto their team (this is MLM, remember). This often brings about misleading earning representations to lure in new members... which is commonplace in the world of MLM recruitment.
So the real salaries may be lower than shown.
While you certainly can't trust everything you read on job review sites like Glassdoor, Indeed, etc... they do provide some valuable information at times.
Overall I've found that the reviews are positive, with both sites having average ratings of over 3.7 out of 5.
One thing that many of the positive reviews have in common is that they mention the training as being one of the main pros to HRMC, which I was expecting to see.
But of course not everyone likes this place and there are some complaints, such as this one left by a disappointed member who worked for months and didn't make any money...
*Note: This isn't HRMC's fault. It is just the way the Legal Shield compensation plan works.
There are also quite a few people who seem to be upset with the fake job postings and how members go about recruiting people in.
I was able to find this on the Anti MLM subReddit...
... along with a warning on the job search forum Better Jobs Faster that basically says the same thing...
Fake job postings are a problem with many MLM opportunities.
The problem comes from associates, agents, consultants, whatever you want to call them, going out and trying to recruit people in underneath them via posting jobs on various job boards.
This often leads to people joining thinking that they will earn some salary like a "normal" job, but it is far from that.
Couple this with the fact that MLM's are typically extremely difficult to make money in and you have a recipe for future complaints.
No, this place is definitely not a scam, although you will find some people calling it one.
There's really no good reason to call them a scam.
Just be aware that there are some misleading job ads for it, as discussed. These come from members of HRMC, not HRMC the company itself.
Hopefully this review has given you a better understanding of how HRMC works and the opportunity they have.
The question of whether or not you should join this opportunity is completely up to you. MLMs, generally speaking, are horrible opportunities if you look at the statistics and failure rates, but with the extra training and support that HRMC provides you should have a better chance at making good money selling Legal Shield products and recruiting others in.
Overall I would say that HRMC is a pretty good company that holds itself to high standards. I started this review thinking I was going to be exposing some scam but have been pleasantly surprised.
However... it's still a MLM opportunity at its core. So you decide.
Another good option you may be interested in, if you aren't a fan of MLMs, is affiliate marketing. This is what I do to earn an online income. The good news: there is no recruitment and you keep all of your commissions, instead of passing them up to those above you.
If interested then I suggest taking a look at Wealthy Affiliate, which took me from $0 to over $6k/mo online.
Your Turn: What do you think of Harvard Risk Management Corporation? Are you a member? I would love to hear any comments/questions/feedback below 🙂
Thinking about joining that new MLM opportunity? You might want to rethink that after seeing these MLM failure rates.
Ahh, the mighty MLM opportunity. Portrayed as a way to achieve financial freedom. As a way to reach one's true potential. As a way to make boatloads of money and live life to the fullest.
Unfortunately the way they are portrayed isn't in-line with reality, which is why efforts are being made to warn people about the dangers of such opportunities by places like the anti-MLM community on Reddit, the Huff Post and even Business.com...
To get a realistic look at the true failure rates that participants experience in MLM opportunities, continue reading...
MLM, multi-level marketing, is a business model where, instead of selling products in stores, a company relies on an independent sales force to do the marketing and selling. They usually have no requirements to join other than to purchase products or some sort of "starter kit", and they usually have confusing compensation plans that are filled with glitz and glam (with a handful of ways to earn money), but they all boil down to provide participants with 2 main ways to earn:
The recruitment side of the MLM is the upside and the downside. It gives participants more potential to earn big while building a team and leads to fast growth for the company, but it also makes the opportunity more difficult for most.
The lure is that you can work when you want and operate your home-based business on your own... hopefully achieving financial freedom in the process. But opportunities like this are often presented in misleading ways, portraying participants living "life without boundaries", such as ACN here...
... as well as living a life of fun, luxury, and fulfillment, such as this clip from Mary Kay's opportunity pitch...
But as you will see, fancy vacations and driving around in Cadillacs is something that very, very few people get to experience.
Most people, by large, make very little money.
The very structure that MLMs have in place are what causes such disproportional earnings among participants, as we will get to next.
There are different types of MLM structures but they all are the same basic thing: you recruit people into the business, those people recruit people into the business, and so on... which causes the downline to branch out and grow larger the further down you go.
Of course there are sales quotas that must be met and other requirements, but let's focus on the "multi-level" part of multi-level marketing here.
From all these people in your "downline" you can earn commissions from... which usually come from products they personally buy or sales that they make.
At first take this may seem great.
Who wouldn't want the opportunity to build a large team by recruiting in new members... a large team that you can earn increasingly large amounts of money from, right?
It is great... IF YOU ARE AT THE TOP.
In any MLM business the money flows from the bottom to the top, which is great if you are at the top but not so much if you are at the bottom.
The people at the top earn extra commissions from the work of others while those at the bottom have potential commissions sucked away from them.
Think of it like this: XYZ business sells health drinks for $100 (a pretty realistic price). As a participant, you can earn a 25% commission, or $25, every time you sell a health drink. BUT... the company actually pays out 75% commissions... and the remaining 50% get's passed up to the sponsors above you. Now if there was no MLM structure, you could keep the entire 75% commission payment yourself.
Good for those on top. Bad for those on bottom.
The other problem is that there are guaranteed to be many more people on the bottom. The very structure ensures this.
WARNING: VIEWER DISCRETION ADVISED
The numbers you are about to see are not pretty. In fact, they are downright disgusting.
According to a report by Jon M Taylor of Consumer Awareness Institute, 99% of participants in MLMs lose money.
Yes, 99% is the claim.
This finding comes after the analysis of 350 MLMs, which includes all the big names.
While not every MLM provides income disclosures of the money that their participants make (probably because it is embarrasing!), some do to try to remain transparent. So let's take a look at some official income disclosures from popular MLMs.
*Note: A lot of times MLMs present their participants' earnings in misleading ways (no surprise here). But after you do the math and cut through the BS, here are some examples of what you will find:
From here the list goes on and on. Time and time again the earnings disclosures from MLM companies are disheartening. In fact, I have never seen a "good" earnings disclosure. Some may appear to be at first sight, but this is usually only due to confusing layouts and manipulated numbers--all in an attempt to hide the horrific truth that the overwhelming majority of people make very little money.
Forced to File for Bankruptcy
In some situations it can get so bad that participants are forced to file for bankruptcy, as we have seen with LuLaRoe.
According to the watchdog group Truth In Advertising, more than 100 LuLaRoe participants have filed for bankruptcy since 2016.
This is due to 2 things:
Participants are often misled into believing they can make unrealistic amounts of money, which leads them to throw their entire lives into the business... in some cases leading to large amounts of bankruptcy filings.
Pyramid schemes are illegal in just about every country.
MLM's are often called pyramid schemes and illegal pyramid schemes are often disguised as legitimate MLM's, as the FTC warns.
What's the difference between a pyramid scheme and a MLM?
The difference is the sale of products to real customers, emphasis on "real".
A pyramid scheme can still have real products to sell, but are they selling to real customers? This is the question that needs to be answered.
Pyramid schemes will rely on recruitment of new members and their required purchases to bring in revenue, whereas a legitimate MLM will place more focus on actually selling products to real customers, customers who are buying products because they actually want them.
It is where the revenue comes from that makes the big difference.
Does it stem from real customer sales? Or does it stem from new members being forced to purchase expensive product packages?
The majority of MLM's force new members to purchase some kind of "starter kit", "starter pack" or something along these lines.
However, this isn't necessarily a bad thing. After all, these starter packs usually contain business materials and products that new recruits can use for promotion, which are much needed.
The lines between what is considered a MLM and an illegal pyramid scheme start to get blurry when starter kits become ridiculously expensive and overpriced, and when the company places increased emphasis on recruitment.
While this isn't a sure-sign of a pyramid scheme, a company that requires participants to make purchases on a regular basis in order to stay "active" is not a good look... and is more likely to have crossed that blurry line into the realm of illegality.
It happens all the time. Large MLM companies get hit with lawsuits for being pyramid schemes and are then forced to change up their operation to more legitimate means.
The video below details the situation with the popular health & wellness drink MLM called Vemma, which was charged as being a pyramid scheme in 2015...
Not all MLMs are equal. Some opportunities aren't that bad while others are down-right horrible.
But the fact of the matter is that they are all MLMs, which all rely on some sort of pyramid structure that siphons money from the bottom to the top... making it a more difficult business for the majority of participants.
For this reason it is advised that you only join if you actually like the products.
If you make a large purchase of essential oils or nutritional drinks, will you find good use for them if you fail to sell what you need to?
If not then you should either 1) Not join the MLM in the first place, or 2) Not order more than you can handle--the last thing you want is to take on more than you can handle and then be forced to file for bankruptcy like those selling LuLaRoe.
Stay safe out there and don't fall for the trickery of people trying to recruit you in--and if you want a home-based business that doesn't require recruitment and where you don't have to share commissions with people above you, why not try affiliate marketing? And why not get started with the top affiliate marketing training program the internet has ever seen, Wealthy Affiliate?
*Note: I joined Wealthy Affiliate back in 2015 and have since been able to turn my online business into a full-time income.
The PartyLite opportunity is often presented as a way to live a flexible and rewarding life, but is it really all that great?
Can you really make good money selling PartyLite products?
You might have seen some of the photos or videos from events the company has held for their consultants, which make the opportunity appear larger than life...
But you can't fall for the hype with marketing like this, and in this article we'll be taking a look at how the business works, the compensation plan, cost to join, and how much consultants are actually making.
You are going to want to read this beforehand if you were considering joining.
PartyLite is a direct sales/MLM company that sells candles, fragrances, and accessories.
The company has been around since 1973 but claims it's roots can be traced way back to 1909, when a school teacher named Mabel Baker began her first candle line in New England.
The company is based in Massachusetts, USA, but operates in a number of countries, such as Canada, Australia, Mexico, and a bunch in Europe.
Anyone can become a consultant for PartyLite, provided that they live in a country where the company operates.
They use what I mentioned is a direct sales/MLM business model. This means that products are sold by an independent sales force rather than sold in retail stores... and it means that consultants can also make money by recruiting in other consultants and building teams.
The company encourages consultants to host parties to sell PartyLite products at, but you can sell them in different ways, such as through your replicated online store.
To join PartyLite as a consultant you need products for demonstration purposes to make sales and you also need business tools. To get these you have 3 different options.
1. Sign Me Up Kit for $49 - This kit includes the essentials... a small amount of products for demonstration purposes along with business tools.
2. Quick Start Kit for $99 - This provides all the business essentials you need along with a variety of products, sampling tools, and literature.
3. Deluxe Starter Kit for $0 - This kit costs nothing up-front but the idea is that you will buy it to then host a party, which you will need to make at least $350 in sales from. This includes the most PartyLite products and also comes with sampling tools and literature.
Hosting your own party may sound like a free option, but if you want everything to go right it will certainly come at an expense. Of course you don't want a bunch of hungry guests or they will never buy your products.
Selling the PartyLite products is at the core of this business opportunity. Consultants can earn up to 32% of sales... so with this in mind, let's take a brief look at what all products this includes.
Candles are their main product and they have all sorts. Jar candles, 3-wick candles, tealight candles, pillar candles, LED candles, and many more.
They range in price from around $10 for small votive candles to $35 for nice jar candles. And they have some collections which are over $40.
This category includes things like wax melts and warmers, fragrance sprays, fragrance sticks, car fresheners, and more.
The wax warmers are the more expensive items in this category and can get up to $55 in price, which could bring you a nice $17.6 commission.
This category mostly includes a bunch of different kinds of holders, such as wax warmers and candle holders.
Here is where you will find some of your most expensive items, with some candle holders going up to $95 in price, meaning there is potential for a little over $30 commissions for each of these sold.
The PartyLite compensation plan is very simple and straightforward, which is what I like to see. All too often MLM opportunities have comp plans that are confusing as all heck... but not here.
There are 3 main ranks within the company and a couple ways to earn.
Here is how it all works. I'll explain in more detail below this...
1. Consultant - This is what you start out as when you first join. You will be able to earn 25-32% commissions on the PartyLite products that you sell.
So for example, if you were to sell one of their signature 3-wick candles, such as the Apple Chai scent, you would earn between $6.75 - $8.64 in commissions since the original price is $27.
As a basic Consultant this is the only way to earn income... by selling products, which can be done in a number of ways (like hosting parties of course).
*Note: 25% is your base-commission on personal sales and a 6% bonus is added if you reach the monthly sales goal.
*Note #2: 25% + 6% = 31%, not 32% like they say you can earn. You don't have to be a math genius to figure this out... but this is the compensation plan as they tell us. So bear with me here.
2. Team Builder - You become a Team Builder when you recruit in 2 other consultants into the business. Here is where the MLM part of it starts to come into play.
At this point you will continue to earn 25 - 32% commissions on your personal sales, but you will also be rewarded with a one-time $200 product award.
3. Unit Leader - To make it to this point you will need to recruit in at least 4 others to join the business. Not only will you be able to earn increased commissions on your personal sales, of up to 38%, but you will also earn commissions from the sales that your unit makes, aka the people recruited in beneath you. You will make 7% commissions from their sales.
BUT... it doesn't end there.
The goal then is to get the people you recruited in to build their own teams and move up the ranks, and for the people on their teams to recruit even more people in... and so on.
So not only will you be able to earn from your team directly, but also from teams that branch off going down.
And the ranks don't end with Unit Leader. Above I went over the 3 core ranks, but there are others. The other leadership ranks that you can move up to include:
The video below from PartyLite provides an easy-to-follow overview of the comp plan (it doesn't talk about the higher leadership ranks however).
PartyLite consultants don't earn fixed salaries because they are independent contractors.
But how much do these consultants earn?
Well, on the website they tell use that you can "earn a few hundred dollars a month... or a few hundred thousand dollars a year!"...
Sounds pretty good based on what they say. I mean, who wouldn't want to earn a few hundred thousand dollars a year with their own home-based business, right?
And they also provide a chart that gives you an idea of how much you can make based on the amount of parties you host per week and the orders you get online...
But this still doesn't tell us much... so let's break down a sales scenario in an example...
If you recruit in 4 other consultants to make it to the rank of Unit Leader and you sell $3,000 in products during the month, you will earn:
But that's a lot of work. You would have to average selling $100 of products per day to make this much at the rank of Unit Leader... and that will prove to be difficult to keep up with.
If you want to be one of the consultants that you see partying with the leaders at PartyLite and going on exotic vacations then you are going to have to climb up the ranks to the top, which means you will need to recruit, recruit, recruit... and get the teams beneath you to recruit as well.
But, of course there is always the problem that MLMs have which comes from their very structure... ensuring that only a small percentage of people can make it to the top.
99% of Participants "Lose Money"
This is the conclusion that Jon M. Taylor of the Consumer Awareness Institute came to after analyzing over 350 MLMs, which he published in a report titled MLM's Abysmal Numbers.
Unfortunately PartyLite does not provide any sort of earnings disclosure to give you a good idea of how much their consultants are actually making. But if we take a look at earnings disclosures for other well-known MLMs that exist, such as Mary Kay and Shaklee, it certainly doesn't look too pretty.
The pyramid structure of MLMs funnels commissions from the bottom, where most people are, to the top, where there is a small percentage of people. This makes it so that there is potential to really climb up the ladder and earn big income... but your chances of getting there are slim.
*Note: No, it's not a pyramid scheme. There is a difference between MLMs and pyramid schemes... legally speaking anyhow.
So can you really make money selling PartyLite? Absolutely.
But can you make good money selling PartyLite?
Well, this is a much more complicated question. You can, but it will not be easy.
MLMs have extremely high failure rates which is why I'm not the biggest fan of them, but if you do really enjoy what PartyLite offers, you really enjoy their products, then who am I to stop you?
One thing that I can say I really like about this company is that they bring good quality products to the table and don't focus too much on making money. They aren't out there just to make a quick buck like some of the MLMs you see pop up with compensation plans that are needlessly complicated.
So anyways... hopefully this post gave you a realistic view of what the PartyLite opportunity is like so that you can make a more informed decision on whether or not it's right for you.
Leave any comments/questions below. I like to hear back from my readers 🙂
And before you go: There are lots of home-based business opportunities out there. If you want to see how I've been generating an income online you can find out here.
The most recent HempWorx affiliate earnings disclosure is pretty dismal, with over 95% earning much less than $1,000 per year.
This is largely due to the difficulties of the MLM industry (which we'll talk more about soon), but also due to the fact that a lot of affiliates aren't doing the 8 things we'll discuss here now... 8 ways to make MORE MONEY with HempWorx.
Assuming that you probably already know this, we'll keep it short.
HempWorx is a product line by the MyDailyChoice company that consists of CBD products, and was just launched in 2017.
Products are not sold in stores. Instead, the company relies on independent representatives (affiliates) to run around doing the selling. Affiliates also have the ability to recruit in other affiliates, build 'teams', and earn commissions from the efforts of those beneath them.
In a nutshell this is a CBD direct sales/MLM opportunity in which affiliates can earn money in 2 ways:
But here we aren't going to be talking about the super obvious like how you should recruit more people in or sell more products to make more money. Here are 8 ways to earn more with HempWorx that aren't quite as well-known...
It will be hard to sell HempWorks products or the opportunity if you yourself don't even believe in what they sell.
You may be a naturally good BSer and have a knack for sales, but there is no substitute for genuinely loving what you sell.
Using the products for yourself will allow you to make a much more personal sales pitch to potential customers. You will eventually have some personal experiences to share (hopefully good ones) and in a modern world where technology has brought about a marketing system that seems to be massively impersonal at times, this is what people want.
And besides, if you aren't using the products then what are you doing with HempWorx anyhow? There are other MLM choices out there..
Again, you may be a naturally good BSer and you may be able to hype up a product without really saying much of anything. That is great and all, but you could do a lot better if you took a bit of time to know some of the science behind the HempWorx lineup and CBD in general.
CBD is all the rage nowadays and has many claimed health benefits, some of the most well proven being a treatment for epilepsy, anxiety, depression, and insomnia.
Adding in something like "In a 2019 study of CBD's affects on anxiety and sleep, it was shown to improve sleep in 66.7% of patients and decrease anxiety in 79.2%"... would sound a lot better than just saying... "it's good for sleep and anxiety". And this study is true by the way.
It would also be helpful to know the science so that you don't spread misinformation. Because of all the hype surrounding this new emerging industry there is a heck of a lot of misinformation being thrown out there... which isn't true.
And you should definitely know what CBD is! There of course are going to be people who, because it comes from the cannabis plant, have the wrong impression of it.
Study the products, get to know them. Know what they look like, taste like, feel like... well maybe not all of that... but you need to get to know them.
Know exactly what they are used for, how they are taken or applied, different concentrations and flavors, etc.
And know what products go together. If someone buys the Hemp-Infused Coffee then the Keto Coffee Creamer can be an easy additional sale to double your revenue.
This should be a given, but it's surprising the number of people selling products when they don't really have much clue of what they are selling. Don't be one of these people.
With the MLM structure that HempWorx has in place it is paramount that you recruit other distributors in if you want to take full advantage of the compensation plan. This is how you move up the ranks and this is how you get leverage on your side.
But don't waste your time trying to recruit everyone that is willing to listen to you. There are a lot of young people more than enthusiastic about the CBD movement, but might not make the best people for your 'team'.
You want people who are serious and who will help you expand your "team", aka downline. You want people who are just as motivated as you are.
In our post on ways to get local MLM leads we mentioned going to real-estate seminars, law of attraction events and things like this.
Because you often meet business-minded individuals at events like these that are serious about taking full advantage of opportunities like this.
Some people are more old-school and will want to run their business face to face, selling products directly to customers and recruiting people in directly. Other people try to do everything online, both the recruiting and selling.
While it is possible to choose either of these methods, it is definitely recommended to take advantage of both.
You get your own replicated HempWorx website with lead capture pages, pre-made autoresponder emails and more. Take advantage of this and advantage of the fact that online you can reach people all over the world without ever leaving your chair.
And never underestimate the power of the old-school approach, which is equally as important. Doing business in the real world, face to face, gives you more power to create personal connections and lasting relationships... which can help build a stronger team. And while the HempWorx company does provide online training, being present and helping out new recruits in physical form can make a difference.
Let us not forget that you are considered an independent contractor (self-employed) with a business like this and that you can deduct your expenses come tax time with the IRS 1099 form.
The one-time affiliate enrollment fee of $20 is an obvious deduction along with any starter pack you order.
If you would go all-out and order the Executive Pack for $599 you might use the products that come with it yourself... but it seems this could still be a deductible business expense since you are using them with the purpose of getting to know your products of course... but I'm no tax professional.
Other expenses could include:
Here is a good list of some top deductions we found online that will give you some other ideas.
No one likes that annoying salesperson that won't give up trying to sell something that you have no interest in. We've all had experiences with these types of people at one point or another.
Salesy salespeople are becoming more and more a thing of the past, as sales methods are improving and data is showing better results from less in-your-face approaches.
There is hard-selling and soft-selling.
Hard-selling is when you jump straight to the point with your sales pitch... you let the person know what you are selling that they instantly know they are being sold to. It is aggressive. Soft-selling on the other hand is more indirect and has more focus on building trust and a relationship before closing a sale.
Of course a sale is the end goal, but try to get away from thinking about making sales constantly. Focus on helping people, whether that be with some health problem that CBD can help with or with the opportunity of a home-based HempWorx business. Focus on helping first and go for a soft-selling approach, which most people who have tried it will say works better.
The insanely high failure rates of participants in MLMs, which was estimated as being as much as 99% by a study of 350 MLMs by the Consumer Awareness Institute, can be a bit misleading.
No one doubts that MLM failure rates are high, but how much are these statistics skewed by people who don't fail... but rather just quit too early and Peter out?
Running your own home-based business has its advantages. There is no commute, more flexibility, no boss breathing down your neck... but it can be difficult to stay motivated and keep on track.
If you are serious about making money with HempWorx then treat it like a job, not just something that you might or might not have time for today.
A lot of new affiliates work other jobs and what not, and you might be one of them. But try to take and schedule a piece of your day where you can dedicate to the business.
So take the time to go to that local meeting. Take time to set up that Adwords campaign. Take the time to help train a new recruit. Of course without putting in the time the results won't come.
Set goals, make a schedule and write it down... and then put this schedule somewhere you will actually see it so that you don't forget. Make it a habit to put in the work.
One of the keys to forming a habit is to make it as easy as possible on yourself. So for example, if you want to create a good habit of eating breakfast then you can prepare it the night before, so that it is easier to eat in the morning when you are tired. Or if you want to make a habit of working out in the mornings you can sleep in your exercise clothing, which means one less thing to hold you back in your normal half-asleep morning state. (tips from Shawn Achor's great book The Happiness Advantage)
Being successful with the HempWorx opportunity, or any MLM for that matter, takes someone who knows the products and believes in what they are selling, knows who to recruit and who might be a waste of time, and takes the business seriously.
Many of these 8 tips seem like they might be common sense, but most people don't do this stuff... and if you do you can increase your chances of good earnings.
But at the end of the day you are still at the mercy of the MLM pyramid business model, which unfortunately favors a small percentage of people due to its structure and how people high-up receive kickbacks (commissions) form affiliates multiple levels down below. This pretty much ensures the high failure rates that we often see.
The HempWorx compensation plan has Leadership Check Matching that pays down 10 levels...
They have Binary Commissions where you can earn even further into your downline...
And they have other ways to earn that are based around the MLM pyramid structure... which is good if you are sitting pretty at the top, but not so good if you are one of the majority at the bottom.
There are many reasons why people who get involved in MLMs fail and the very structure of the business model is undoubtedly one of the main reasons, which is why here at Legendary Wallet we promote affiliate marketing and recommend the Wealthy Affiliate training program to get started, as this requires no recruitment and you keep all your commissions.
Now it's your turn: Do you have any tips for HempWorx affiliates to increase their earnings? Let us know in the comment section below...
We like to hear back from our readers 🙂
You asked and we're here to answer: Is My 20 Dollar Travel Business a scam?
They say you can become a member for the price of a pizza, enjoy massive discounts on travel, and earn boatloads of money in the process... but is this really all true?
On the website they show incredible offers that even make me want to join...
But... after review it appears that this business isn't quite as good as they claim to be.
I did a lot of digging around and in this review I'll be going over what exactly My 20 Dollar Travel Business is, the travel discounts available, the business opportunity and compensation plan, complaints and more.
My 20 Dollar Travel Business (M20DTB) is a travel discount membership program that has a MLM business opportunity attached to it. It was created by Steve Gresham, the creator of the now defunct and eerily similar My 1 Dollar Business opportunity.
Members are able to enjoy savings of up to 90% on condos, up to 75% on hotels, and save on car rentals, cruises and other travel expenses.
The cost to join starts out at $1 for a 30 day trial, but this doesn't give you access to much and in order to actually earn any real money with the business opportunity, it will cost at least $20/mo.
They claim that you can earn $2k to over $10k a month, but as we'll uncover in this review... this isn't a very plausible outcome.
As mentioned, you will be able to save money on all sorts of travel/vacation related expenses, including cruises, car rentals, and hotels.
There are 3 different membership levels but only a Gold or Platinum Membership will give you access to the Travel Engine and membership savings.
The Gold and Platinum Memberships provide the exact same benefits as far as travel savings, the only difference is that the more expensive Platinum Membership gives you more opportunity with the Compensation Plan, which we'll get to here shortly.
The travel search engine will give you the ability to search for different travel related deals and see side-by-side price comparisons with large sites such as Expedia, Hotels.com, etc.
*Note: While this opportunity is advertised as a way to save up to 90% on condos and up to 75% on hotels, this certainly should not be expected.
On their website they state that there have been "over 4 million memberships sold" and that the travel engine is powered by a company with an A+ BBB rating that has been around over 20 years. But we are given no information as to what the name of this company is.
It seems that My 20 Dollar Travel Business is simply a business opportunity created around an existing travel platform... we just don't know which.
Besides the vacation and travel discounts that come with the membership you will also have access to the business opportunity, which is a MLM (multi-level marketing) business structure.
The idea is that, because the travel industry is so massive, and because everyone wants to save money when they travel... then it should be easy to sell people on the My20DollarTravelBusiness opportunity.
Some people might join just to enjoy the travel discounts while others might join to participate in the business opportunity and enjoy travel discounts.
There is a 'pay it forward' mentality. Recruitment is the name of the game and after you recruit in at least 2 people you are supposed to help them recruit in at least 2 people each... and so the multi-level marketing structure expands.
As already mentioned above, there are 3 different membership levels you can join at:
However, if you want to participate in the compensation plan then you are going to have to be come a Gold or Platinum Member.
There are 3 ways to earn with the My20DollarTravelBusiness compensation plan and you must recruit at least 2 people to join before you can receive commissions.
When you get new members to join you will earn Fast Start Commissions of 50% of their membership purchase.
The Fast Start Bonus only pays commissions on the price your new recruits pay to join, which covers their membership for the first month.
But what about after that? What about the subsequent monthly membership payments of members you recruited?
This is where the Personal Residual Commissions come into play.
Starting on the 2nd month after your new recruits join you will earn 25% commissions of their membership cost each month going forward.
You will earn:
The Team Bonus structure is a 2x10 matrix. You are at the top, there are 2 positions under you on level 1, there are 4 positions on the next level down at level 2, then there are 8 positions and so on.
The structure branches out by a multiple of 2 on every level and goes down a total of 10 levels.
You will be able to earn 5% commissions on membership payments down these 10 levels.
Your goal is to recruit 2 people in, get them to recruit 2 people in, and so on. However, anyone can recruit as many people as they want and the extra recruits will fill open positions in the structure.
The catch to all of this is that your membership level will directly affect your earnings.
The opportunity is presented as being a way to earn $2,000 - $10,000 per month and is said to be "very simple". But this is extremely misleading.
They even give an example of how "easy" it is to make $10,000+ in monthly income...
You and your team can "jump straight to the top" by going Platinum...
But the reality is much different, and this is the reason the Consumer Awareness Institute found that 99% of participants in MLMs lose money, after analyzing 350 different MLM business opportunities.
First off, even if you do refer in 2 people, the idea that everyone else in your downline will do the same down 10 levels with over 2,000 positions is absolutely absurd.
A more realistic representation of what will happen is something like this, which has empty positions throughout:
And the idea that you will be able to fill all positions down all 10 levels with Platinum Members is also absurd.
When they say that you can earn $10,270 a month... they are talking about in the perfect scenario... with every position filled and every member being Platinum.
There is no income disclosure by the My 20 Dollar Travel Business company.
We can only speculate as to how much members earn.
Upon first glance it appears that this business has incredible reviews. With over a 4/5 star rating on Facebook from real people how could you go wrong with a business like this?
However, after looking a little more closely and digging deeper it appears that most of the ratings and reviews written are from people just trying to promote the business and make money.
There aren't really any good sources of member reviews about this company. However, I do have a few complaints of my own.
#1 - Lack of Transparency
No earnings disclosure... no information on the Travel Engine that this company is piggybacking on... Where is the transparency here?
#2 - Misleading Income Claims
Yes, it is true that you can make $10,270 per month if everything goes absolutely perfectly... but you also have a 1 in 3,748,067 chance of getting attacked and killed by a shark!
#3 - Lack of Ingenuity
This company was basically put together to turn a Travel Engine into a business opportunity. The product here is a Travel Engine that already exists and the creator threw together a compensation plan on top of it.
It's not the amazing new business that it may seem to be.
Is My 20 Dollar Travel Business a scam?
No, at least not in my opinion. While transparency of this opportunity could be improved and it could be represented in a much more honest way, it still is a real opportunity in which you can get nice discounts on travel and potentially make money.
Is My 20 Dollar Travel Business a pyramid scheme?
This is a grey area. The MLM business model does have a pyramid structure but according to the FTC legitimate MLMs sell products while pyramid scheme scams do not, instead relying on incoming investments from new recruits to pay off older members.
Since there is a real product here it isn't a pyramid scheme.
Recommended: Difference between MLMs and Pyramid Schemes
Is My 20 Dollar Travel Business BBB Accredited?
No, they are not. The Travel Engine they use is said to be accredited and to have an A+ rating with the BBB, but as mentioned they don't provide any information as to what the company behind their travel discount membership is. But the M20DTB company is not accredited.
The decision of whether or not to join is ultimately up to you, but overall this does not seem like a very good quality opportunity.
MLMs are bad enough as they are, and this seems to be one that is just piggybacking on another company and overall lacking.
The reason so few people make money with MLMs is because of their pyramid structure, which provides the top few percent sitting pretty at the top with kickback commissions while actually making it more difficult for the majority at the bottom... leading to a not so great opportunity.
This is why I stick with affiliate marketing and recommend this business model if you are looking to make money online. No commissions get passed up and there is no recruiting.
What I'd recommend for anyone interested is the Wealthy Affiliate program, which I joined in 2015 and am still a proud member of.
Take care and be sure to leave any comments/questions below. I like to hear back from my readers 🙂
Zilis' products are said to be some of the best, and the business opportunity is said to be a way to achieve financial freedom, but how true is all of this?
Is Zilis a scam?... are they legit?
In this review we'll be taking a look at the products and addressing quality concerns, the business opportunity and compensation plan, how much you can realistically make and more.
Thinking about buying products or joining the business? Hold off on answering so soon. You are going to want to read this first...
Another company from our list of CBD direct sales companies, Zilis was founded in 2015 by Steven and Angie Thompson and is based in the great state of Texas. They claim to be the "fastest growing CBD company in the United States", but who knows how true this is. What we do know is that they are at least one of the big players.
The company uses a direct sales approach to sell products, meaning that they rely on an independent workforce of "ambassadors" to do the selling. Additionally they are is a MLM (multi-level marketing) component to the business which means that ambassadors can recruit in other ambassadors to build "teams" and increase income potential.
The products in their lineup vary with intended use, but all are based around the fast emerging industry of CBD.
This business if very similar to HempWorx if this place is at all familiar.
*Note: The name "Zilis" actually comes from the Swahili language and means "nutrition multiplied", which is pretty cool.
In short, no this place is not a scam. Neither the products nor the business opportunity is a scam. And Yes, everything that they are doing is legal. Although CBD comes from the cannabis plant it has no hallucinogenic effects and is legal. It is a cannabis extract without the "high" often associated with marijuana.
However, the business opportunity can be said to be misrepresented. It is not "easy" to make money with this company and you will see why later in this review.
The product list is pretty short and I'm not all too impressed by it. However, they do provide products that I have never seen before and the quality seems to be top-notch.
You can purchase some non-hemp-based products through their platform but the main product lineup consists of their "Ultra" products, which include:
This is their regular old "Full Spectrum Hemp CBD Oil" as they call it. This means that it isn't pure CBD extract but also isn't hemp oil that contains no CBD.
Sometimes the labels can be confusing. This is a full spectrum hemp extract that contains CBD in the mix--but the concentration isn't listed.
Concentrations of CBD in full-spectrum hemp oil vary naturally, but according to the FAQ page on Zilis' website there is generally around 16.67mg of CBD per serving... meaning 16.67mg per 1mL. This is equivalent to a 1oz bottle with 500mg of CBD, which is pretty typical.
It is sold in 1 ounce dropper bottles that can be taken alone or added to drinks. Available flavors include raw (natural), berry, and lemon.
The UltraCBG includes a concentrated amount of CBG, which is another cannabinoid from the cannabis plant, like CBD, that is said to have many of the same benefits, but occurs in smaller amounts naturally.
This product is a mix of full spectrum hemp oil with the addition of a concentrated amount of CBG. There are about 5mg of hemp oil extract and 2mg of CBG per serving (a serving is 1 mL).
It also comes in a 1 ounce dropper bottle and is flavored with hibiscus.
This can also be easily supplemented by itself or added to drinks.
This is a topical UltraCell product that is a cream and comes in a container. It is also "full-spectrum hemp CBD oil" as they call it.
It consists of CBD, aloe vera, and organic oils--and can be applied topically for aches/pains or for it's skin rejuvenating properties.
It can be purchased in 2oz containers or min (0.23oz) containers.
And now this takes us to what are called Ultra Boosters. These are supposed to compliment the Ultra products above by using the "Mimetix" formula. However, they can also be taken as standalone products.
The Mimetix formula contains green tea leaf extract, hops flower extract, turmeric root extract, ginger root extract and echinacea leaf extract... and is supposed to support the health of the endocannabinoid system.
Basically what this blend is supposed to do is help enhance the effects of their hemp-based products. BUT... these are all hemp-free.
*I'm not entire sure how effective this Mimetix blend is at "boosting" the effects.
UltraBurn is a water-soluble weight loss supplement that consists of a blend of natural ingredients including Chromium, garcinia cambogia, green coffee extract, coffee robusta seeds, and the Mimetix blend.
Much of it's metabolism boosting power seems to likely be contributed by it's caffeine content.
It has a spicy cinnamon taste to it and comes in a dropper bottler.
This also contains the Mimetix formula and is for homeostasis support... keeping the body in good balance. It provides some well-known anti-inflammatories in the mix which can have a wide range of health benefits.
UltraEdge is their cognitive support supplement and it is formulated to give your brain an edge. It has the Mimetix formula along with ingredients like acai, maca root, citicoline, rhodiola root extract and more.
Benefits include improved mental clarity, mental energy, focus and concentration, alertness, and overall cognitive functioning.
Besides the Mimetix blend, UltraDream has GABA, melatonin, and chamomile extract to support sleep.
The relaxing effects from this product would go nicely with a CBD product as well.
So they sell CBD... but how good is this CBD. There can be a massive difference between good quality CBD and poor quality CBD that may have came from poor crops and/or damaged during production.
They are certified, source their crops from good areas, have each batch tested before sale, and go through the trouble of bringing water-soluble CBD to the public--so as far as I see it they are bringing some top quality products to the table.
Certifications - The company is certified with the US Hemp Authority. This ensures high standards, best practices and self regulation... so that you know the products you are receiving are up to par.
USA Origin - Zilis sourcs their hemp from a certified USDA producer in Colorado. This doesn't ensure a top quality product, but it is nice to see that these crops will be under more heavy regulation than if they were grown in many foreign countries.
Is Each Batch Tested? - Yes, Zilis does have each batch of product tested before being packaged and shipped to customers.
The nice thing is that they actually have an app you can download where you are able to scan the bar-code of any product to see the analysis report, where it came from, etc.
*I'm unsure if they test in-house or have a 3rd party do the testing.
Bio-availability - Zilis CBD products are water-soluble, which is good if you are taking them orally.
Water soluble CBD has a much higher bioavailability than oil-soluble CBD, which isn't easily absorbed into the blood stream and largely goes unused.
It's nice to see that Zilis goes through the trouble of turning CBD water-soluble. This is an added step in the production process that some companies don't bother with. Not all CBD products are like this... and many companies don't even make the distinction.
The business opportunity is a combination of direct sales and MLM.
As mentioned, Zilis doesn't sell products in stores. Instead they rely on an independent sales force of ambassadors, which anyone can become by joining.
Ambassadors can make money by selling products and recruiting in other ambassadors into their "team", which is the MLM (multi-level marketing) part of it.
Everyone has to pay the membership fee of $99 to join. But if you want a backoffice that helps with managing an organization (of people you get to join) then that will be an extra $29/mo.
There are also 3 starter packs that you will be pushed to purchase, which will provide you with Zilis products and increased earning potential in the compensation plan.
*Ambassadors recruiting you in might also push you to purchase the more expensive starter packs because they will earn larger commissions.
There are 7 different ways to get paid, ranks, a pyramid structure where commissions get passed up, bonuses, etc.--overall pretty typical of a MLM business.
I'll go over each way you can earn and I'll be breaking them down so they are as easy to understand as possible... MLM comp plans are well-known for being confusing.
But first we need to cover the different ranks... which are very important. The higher rank you have, the more earning potential.
Keep these ranks in mind as we go over the 7 ways to earn. You will see that they make a big difference.
Some terms to remember as well include:
First up on the list is Retail Profit. This is profit that comes from selling to customers.
When you sell to customers you have 2 choices.
Additionally, there are 2 types of customers: Retail Customers that purchase one-time at full price and Preferred Customers that sign up for monthly auto-ship and get discounts.
Qualification: You only need to "be in good standing" as an ambassador to earn these commissions.
This bonus comes when you recruit in a new Ambassador and they purchase one of the optional product packs.
You will earn:
Qualification: You will need 50 autoship PV or 75 in other PV the month prior. As mentioned, these numbers come from the order volume of you and your customers.
They tell us that the binary commission structure "pays you up to $30,000 a week" but this is definitely not something you should count on. At the beginning Associate rank you will only have the potential for $250/wk at most.
The way it works is there is a recruitment tree that branches off by a multiple of 2 every row it goes down. There is you and below you there are 2 positions... below those 2 positions there are 4 positions, and so on.
When you recruit Ambassadors into the business they will be placed in your downline at open positions. As you recruit in more Ambassadors they will also recruit in more people, further filling out your downline.
You will be able to earn 20% commissions from the order volume of enrollment packs or upgrades on the side of the binary structure that has less.
Qualification:You must have 100 autoship PV or 150 other PV from the previous month.
This bonus is reserved for people of the Area, Regional, and National Ambassador ranks and is an additional recruitment bonus when new ambassadors join and purchase one of the starter packs.
You will earn $8 - $150 in extra commissions from new ambassadors purchasing starter packs through this bonus--which is dependent on rank and the type of starter pack purchased.
These are paid from all order volume in your downline except for starter packs and are considered "the foundation of your residual income".
They are paid down to 6 generations deep in your downline... BUT, it's not the same as the downline mentioned with the Binary Commission structure. Instead, these are paid out via a uni-level structure what looks something like this:
In this structure there can be an infinite number of people on each level (generation in this case). A generation is formed when someone in your downline reaches the leadership ranks and has a good-sized team of their own. So it's basically a team within your downline team... if that makes sense.
The commissions per generational level are as follows:
With this bonus you can earn up to 9% of the volume from your generational downline... only this bonus goes down infinite generations instead of just 6. These are also paid on all order volume except for starter packs.
This bonus pays on all the Ambassadors that you personally recruit in who reach the leadership ranks and is a percentage matching bonus of the IRB just mentioned above.
You will start to receive this bonus at the rank of Area Ambassador at 10% and can earn as much as 40%.
In addition to the 7 ways to make money, Zilis also provides some benefits that Ambassadors can enjoy.
And That's It!
Now that wasn't so much now was it?
I know this can get pretty confusing... and often times MLM compensation plans look amazing and borderline genius... but don't get too excited too fast.
Let's take a look at how much you can make... realistically...
With an elaborate compensation plan that pays all sorts of bonuses and allows you to earn down multiple levels and build large teams... it seems like you could earn a heck of a lot of money.
And when they promote the opportunity as "the road to freedom" it also makes this sound like a no-brainer to join.
BUT... when you look at the statistics and how much other people are making it paints an entirely different picture from what you might have been expecting.
Unfortunately they don't provide us with any statistical charts that show us the average earnings per rank like some companies do.
This is what they tell us:
"Since Zilis has recently launched, it lacks enough statistical data to prepare reliable income disclosures. The numbers below reflect estimates prepared by the company pending a more detailed survey. Based on industry standards, the average annual gross income for Direct Sales distributors averages less than $300. There will certainly be participants who will earn less while others will earn much more."
They say that there isn't enough data for them to put together an income disclosure BUT that the average annual income of participants in these types of businesses is less than $300. Less than $300 per year.
This certainly isn't very encouraging, but it's the truth. And the reason behind this is due to the structure of the MLM business, which is a pyramid that funnels commissions from the bottom to the top, resulting in a small percentage of people at the top making big money while most struggle.
However, at the defense of MLM opportunities... we don't know how many people join and then just give-up without ever really trying... so the reality may not be quite as bad as the statistics lead one to believe.
There really aren't many complaints at all about Zilis when searching online. They have an A+ rating with the BBB and only a handful of complaints, which aren't anything to worry about. And when it comes to popular complaint boards the complaints are nonexistant.
This is likely because they are one of the smaller CBD direct sales companies out there... and certainly not the "fastest growing CBD company in the United States" like they state.
However, I do have some complaints and concerns of my own that should be addressed.
#1. Overpriced Products?
When there is a compensation plan that pays out some pretty high commissions in multiple ways and when Preferred customers can save an average of 50% just by signing up for monthly autoship it brings up the question... are the products priced too high in the first place?
It sure seems this way. Although, on the other side of things, these are some good quality products that you can trust.
#2. The Opportunity Is Misleading
There is no argument here... the opportunity is misleading... period.
Sure, there is lots of income potential, but only a very small percentage of people actually make "good" money with these sorts of business models.
#3. Is This a Pyramid Scheme?
This is a concern rather than a complaint... and an important one.
We know that the business model has a pyramid shape to it. The Generational Bonuses, Binary Team Commissions, and some of the other bonuses pay down many levels... or if you look at it in reverse... they pay up many levels... up the pyramid.
But the difference between a legitimate MLM and a pyramid scheme is the sale of products to real customers.
Does Zilis have real products? Yes. And do they sell them to real customers? Yes.
I'm sure Ambassadors do feel forced to purchase products at some points in order to meet the different PV (personal volume) requirements per month, but this likely isn't enough to call it a pyramid scheme... and I guess the FTC agrees here because they haven't shut the company down.
The bottom line is this: Zilis has high quality products and if you want to buy CBD that is almost guaranteed to be "the good stuff" then they are an option. But the business opportunity just isn't as great as it seems.
The people that excel in these types of businesses have strong communication skills and are darn good at recruiting people in... but because of the pyramid structure there isn't room for many people to climb to the top.
This is why I often recommend affiliate marketing to people because there is no recruitment involved and no sharing commissions with other people. This is actually what I do to make a living online and I've been doing such since 2015.
*Note: If this is something that might interest you then I highly recommend the Wealthy Affiliate training program.
I hope you found this review helpful. And if so, please help me out by giving it a share.
Also, leave your comments/questions below and I'll get back to you soon 🙂
HempWorx products are expensive, but are they worth it? The business opportunity is promoted as being a way to achieve financial freedom, but is it really?
Is HempWorx a scam that would be better off avoiding?
There is a lot to cover in this review. We will start off by giving a basic overview of the company, followed by a list of there products and concerns about quality, the business opportunity and compensation plan, complaints and more.
Thinking about buying HempWorx products or joining the business as an affiliate? Don't answer this just yet! You are going to want to read this first...
As you may or may not already know, HempWorx was on our list of CBD direct sales companies. This alone tells you a lot.
HempWorx itself isn't actually a company, but rather a product line within the My Daily Choice company, which was founded by Josh and Jenna Zwagil in 2014. It wasn't until 2017 that the company officially launched their HempWorx product line and made a big turn into the world of selling hemp-based products.
Besides selling various hemp-based products that are all the rage these days, they also offer an opportunity to people who would like to join the team and make money from home.
They don't sell any products in retail stores like you would normally see, instead relying on an independent sales force to do the selling/marketing... which anyone can become a part of as long as you pay the startup cost (which I'll go over). Additionally the business model has a MLM component to it so that members can recruit in other members and build "teams" which they can earn commissions from, thus leveraging the work of others and potentially making big profits.
All of the products are based around CBD. There is a good chance you already know what CBD is, but in case you don't here is a brief overview of this incredibly popular cannabis-derived substance...
CBD is short for cannabidiol and is one of many cannabinoids found in the cannabis plant. The other famous cannabinoid that you often hear of is THC, and this is the hallucinogenic stuff. CBD on the other hand has no hallucinogenic effects.
In a nutshell, CBD is an extract from cannabis that is legal and provides much of the benefits of medical marijuana, without getting you 'high'.
Research is still in it's infancy, but so far the benefits look promising. It has been shown to help with everything from insomnia, stress, anxiety and depression, to pain management, epilepsy, and may even reduce chances of heart disease.
You can take a quick look at the explanation from Dr. Oz for more info:
Back to the HempWorx products...
One thing that I really like about the product lineup here is the creativity involved. HempWorx has by far one of the best product selections out there based on the research I've done.
Their lineup includes the following:
Full Spectrum CBD Oil - $69
Their Full Spectrum Hemp Oil, aka "full spectrum CBD oil" is plain, simple and effective. This is good ol' fashion, regular old concentrated oil that comes in dropper bottles... not a "creative" product by any means but nonetheless very important and in-demand.
It can be bought unflavored (natural) or in peppermint and cinnamon flavors. The three strengths available are 500mg, 750mg, or 1500mg, which is the concentration of CBD per bottle (1 ounce).
Relief - $69
This product is a cream that is intended to be used to relieve aches and pains. It is to be applied topically over sore areas.
It can be purchased in either 30mL or 50mL containers and is infused with 80mg or 130mg of CBD respectively... and has the addition of Emu oil, which can help in wound-healing and has anti-inflammatory properties.
Renew - $69
HempWorx Renew is another CBD-infused cream that comes at the concentrations of 80mg of CBD per 30mL container or 130mg of CBD per 50mL container. However, this cream is for rejuvenating skin and also contains a mix of apple stem cells which can protect skin, help repair damaged tissue, and lead to vitality and longevity overall.
Revive - $69
Revive is a topical thin face cream that includes ingredients like hydrolyzed collagen, aloe vera, retinol, and of course CBD... in which it has 80mg. This product is intended to help reduce fine lines and boost skin elasticity.
It is sold in small 0.5 fl oz bottles and has the same 80mg amount of CBD as the Renew cream listed above, making it a stronger concentration.
CBD Pet Oil - $39
If you are a pet owner or are looking to sell CBD pet products then here you go. This is Whole Hemp Extract for Pets and contains 250mg of CBD per 1 oz dropper bottle, which provides about 5mg CBD per serving.
How will you get your dog/cat to take this? Well, it's bacon flavor! (natural bacon flavor)
CBD Dog Treats - $39
The dog treats are another great option if you have dogs... or are looking to sell products to dog owners. They are baked with no wheat, no corn, no soy, no added sugar, no artificial preservatives, etc.
Full spectrum hemp oil is baked into these but the amount is not stated.
CBD Bath Bombs - $49
The Bath Box consists of bath bombs that are infused with CBD so that you can enjoy a relaxing soak in the tub.
They are available in different scents: lavender, lemongrass, sea salt, and citrus. These scents are made by the addition of essential oils.
Each bath bomb has 100mg of hemp seed oil along with 10mg of extracted CBD.
Hemp-Infused Coffee - $69
With 5mg of CBD per cup, the hemp infused coffee that HempWorx sells is a nice way to easily add some CBD to your daily diet. Additionally, these Arabica beans contain chaga mushroom which has a number of health benefits.
Keto Coffee Creamer - $69
This is a great product if you are a keto dieter or even for all the non-keto people out there. They give coffee drinkers a healthy alternative to sugary creamers that are all too common.
Besides having CBD, they also have MCT oil and garcinia cambogia among other natural ingredients. The amount of CBD per serving is also 5mg per cup... so if you use this creamer with the hemp-infused coffee you will be getting 10mg of CBD per cup.
HempWorx CBD Infused Fruit Gummies - $69
A container of these will provide you with 45 lemon, orange, and grape flavored gummies, each infused with 10mg of CBD.
This is a great, tasty CBD snack and has no artificial sweeteners or colors.
HempWorx Hemp Hair Mask - 69
Their Hemp Hair Mask provides hemp seed oil, amino acids, and vitamins to help combat frizz and rejuvenate hair.
It is free of potentially harmful parabens and sodium chloride, and this product does not contain CBD.
HempWorx Hemp Hair Serum - $59
Their "Liquid Gold" hair serum is another hair product that contains no parabens, no sodium chloride, and is formulated with cold-pressed hemp oil, amino acids, and vitamins to help nourish hair.
There is no CBD in this.
HempWorx Hemp Hand & Body Lotion - $25
With hemp-seed oil, lots of amino acids and vitamins, along with shea butter, the hand and body lotion they have here is supposedly pretty good.
There is also no CBD in this lotion, nor is there parabens and sodium chloride.
HempWorx Hemp Shampoo - $39
The Hemp Shampoo is the same as those above, just in shampoo form. It is paraben and sodium chloride free, contains no CBD, and is made with amino acid and vitamin-rich hemp-seed oil that has been cold pressed.
It is for all hair types and is safe for color.
HempWorx Hemp Conditioner - $39
HempWorx Hemp Conditioner is the complementary product of the Shampoo. It is free of sodium chloride and parabens, has no CBD, and is made with cold-pressed hemp-seed oil that is naturally rich in amino acids and vitamins.
It will supposedly make your hair "silky smooth", but I can not attest to this outcome.
*Note: They also sell product packages, such as the Director Pack for $199 and the Executive Pack for $599, which contain various products in a bundle.
Sure, many of the products are non-GMO, made using organic methods and whatnot... and this is great... but what about the quality of the extraction process and things like this?
Extraction Process used: HempWorx uses CO2 extraction to pull the CBD out of hemp plants, and this is good. CO2 is a safe, non-polar solvent that is naturally occurring--and has even been labelled by the FDA as safe for industrial extractions.
In the process it is pressurized and used to pull petrochemicals out of a plant, in this case the cannabinoid CBD.
One of the reasons this method is becoming so popular is because there is no need for excessive heat, which can compromise the natural compounds being extracted.
Where It's Grown: They don't disclose the specific areas where their hemp crops are grown but we do know they are in the United States.
This is another good sign. Although this doesn't necessarily ensure a top quality crop by any means, it does mean that the crops grown will be held to higher standards and subject to more regulation than say... crops grown in China.
Certification: Each batch has a certificate of analysis--meaning that if you buy something that says it should have 750mg of CBD in it, you can rest assured that it does actually have that amount.
You can visit their documentation page to find certificates of analysis on every product, which look like this...
There is no information on the 3rd party that is performing the testing, but it seems that you can get source data upon requesting it.
Additionally, HempWorx is certified by the US Hemp Authority, which helps to ensure that they provide quality products and aren't cheating anybody.
Overall the products seem to be held to very high standards. HempWorx does a lot to ensure high product quality and this is exactly what you want to see.
But are the products worth the high prices? This is arguable and I'll be talking more on it soon!
As mentioned, anyone can join the HempWorx business opportunity. They have a direct sales business model which means that an independent sales force does all the selling... and a MLM structure which means that you can recruit others into the business and build a team to earn more money.
These sorts of opportunities are often promoted in over-the-top fashion... with lots of talk about financial freedom, living a dream life, and it isn't uncommon to see companies like this hold large live events that look almost like EDM concerts.
But I'll be giving you a more down-to-earth explanation... just facts here (and maybe a little of my opinion!).
In order to join as an affiliate you will have to pay a one-time enrollment fee of $20 and you will have to make a purchase, which can range from $39 - $599.
The cheapest product options are the pet products, both of which sell for $39. But if you want to go all-in you can purchase the Executive Pack for $599, which includes 12 items.
So if you do the math the minimum amount to join would be $59 ($20 + $39).
The reason someone might buy an Executive Pack for $599 is because this also gives them a higher rank in the company. So not only are you buying products, but you are buying a rank which will give you increased earning potential (more on this).
After enrolling you will be given different business tools to help you kick-start your home-based business. These include things like a website with various lead capture pages, pre-made autoresponder emails, and a tracking back office.
Like any good direct sales/MLM company, they don't just leave you high and dry. You will be provided with marketing training that that includes pre-recorded training videos and weekly livestreams to help show you the ropes.
The compensation plan here has a heck of a lot to it. Bonuses, binary commissions, money pools, car incentives, etc.
It can be very confusing if you are new to the whole MLM thing, but I'll break it down so it's easy to understand.
*In my opinion MLM companies try to make their comp plans confusing on purpose--so that they seem like some incredibly complex and generous plan... but the reality is often different.
Before I dive into the different ways to earn, it's important to talk about ranks.
There are 12 ranks total:
Your rank depends on 2 main variables: How much product you sell and how big your team is. The more products you sell, and even more importantly the more affiliates you recruit, the higher up the ranks you will climb and this will 'unlock' more of the compensation plan for you.
There are 9 different ways that you can essentially make money here. I'll break down each now.
You actually don't even have to join as an affiliate to enjoy this bonus. As a Preferred Customer who creates a customer account with HempWorx and signs up for monthly auto-ship of products, you can get a free product when you refer 3 other people buy something.
This has nothing to do with recruitment of other affiliates. Here you are just referring other customers.
You can refer 3 people over and over again to continue to get free products.
There are 2 types of customers, Preferred Customers and Retail Customers.
As mentioned, Preferred Customers are the customers that sign up for monthly auto-ship of products--and they also enjoy a discount because of this. Retail Customers are customers that purchase products at retail price without signing up.
When an affiliate makes a sale to a retail customer they earn the difference between the retail price and the wholesale price. When they get someone to signup as a Preferred Customer the commissions from the monthly orders of each customer will be paid out via Binary Commissions (which I will get to in a minute).
Affiliates can purchase extra products themselves and sell them directly or they can refer people to purchase products through their HempWorx website provided to them.
To qualify to earn these bonuses you must generate at least 40 Personal Business Volume (BV) each month. This means you must sell a certain amount of products each month or purchase the products yourself.
Each product has a certain BV attached to it. For example: Full Spectrum CBD Oil, Relief Cream, and Hemp Infused Coffee all have a 40 BV value.
These Jump Start Bonuses are commissions you can earn from orders of Preferred Customers or affiliates within the first month of joining. They are intended to provide quick income.
You can earn these bonuses down 10 levels at most-- meaning from people you personally get to join (level 1), from people they get to join (level 2), from people that level 2 affiliates get to join (level 3) and so on.
Don't get too excited! They say that you can potentially earn "$1,000,000 per month" with this part of the compensation plan alone, but as I'll discuss in a bit... this is VERY unrealistic.
Binary Commissions are paid out based on orders of Affiliates and Preferred Customers.
When you get Preferred Customers to join, they are added to your Binary Commission "tree". When you recruit affiliates to join, they are also added to your Binary Commission "tree", which looks something like this...
But it doesn't end there. When affiliates in your "tree" recruit in other people, they also fill open positions somewhere down the line so that the "tree" branches out more and more and grows in depth.
You will earn commissions each month based on the overall order volume of the side with the lesser volume (there is a right and left side)--and at most, you will be able to earn 20%. when starting off at 'Unranked' you will only earn 8%.
You also only need 40 BV to qualify each month.
This is by far one of the most lucrative parts of the comp plan because of how this binary commission tree can grow and grow further downward.
They claim that this is "what truly separates this compensation plan from any other in the industry" but I'm fairly certain I've seen similar check-matching bonuses before.
The Leadership Check Matching is a match of everyone's Binary Commission check. So just like how you can earn 10 levels down with Binary Commissions, you can also earn 10 levels down with this check matching.
This is a pool of money they set aside. 2% of all the business volume from the entire company gets put in this pool.
To qualify you have to generate at least 40 BV and enroll 4 new customers or affiliates for a given month. If you meet this qualification you get 1 share in the bonus pool.
The amount you will make per share depends on how much money the company makes.
If you are able to make it to the Executive rank or higher then you will be able to earn these bonuses by maintaining rank for at least 90 days and having at least 90 BV.
These bonuses range from $500 to $100k if you reach the highest rank.
8. VIP Auto Club
This is reserved for people who reach the 5K rank up to the 50K rank, and is a monthly car allowance that ranges from $150 - $1,000 per month.
9. Elite Expense Accounts
This is the top of the iceberg and is reserved for 100K affiliates and higher. It is a monthly allowance that you can use however you want.
Okay... so you can see how important rank is. The higher ranked you are the more of the compensation plan you get access to.
But how do you move up the ranks?
The chart below explains everything. In order to move up the ranks you must have certain amount of personal business volume (BV), a certain amount of BV in your "tree" (aka team or aka downline) and you must have a certain number of personally recruited people in your enrollment tree...
*Note: To achieve the rank of Executive you first must have a month where you have 200 BV to qualify. Then after that you only have to achieve 90 BV per month.
As you can see the amount of personal business volume doesn't change much. You are first required to have 40 BV and this number only increases to as much as 90 BV even up to the highest rank. HOWEVER, the amount of business volume from your "tree" (downline) increases exponentially... going from 300 BV at the rank of Builder to 1,000,000 BV at the Super Affiliate rank.
What this means is that you don't have to increase your personal sales... what you have to increase is your recruitment of affiliates into the business. You have to recruit affiliates to bring in some BV and so that they can recruit in other people to help grow your "tree". The overwhelming emphasis of these rank requirements and the overall compensation plan is to recruit, recruit, recruit.
This is the most recent official income disclosure I have found. It provides statistics about affiliate income from May 2018 to May 2019.
Don't worry if it's too small to read... I'll explain below.
Some of the more important stats to note include:
Takeaway: Only about 1.7% of all affiliates made it past the Executive rank. And you can see there were only 2 Super Affiliates... which goes to show how hard it is to climb up the ranks.
Takeaway: If only 1.7% of all affiliates reach the ranks of 5K and higher, this means that 98.3% of all affiliates are earning less than $1,000 per year on average. Per year!
Cold. Hard. Facts.
As you can see, the way these sorts of opportunities are promoted is often misleading. It isn't easy by any means and the statistics prove exactly this.
HOWEVER, what these statistics don't tell us is the amount of work that these affiliates put into the business. For all we know 50% of them could have signed up and gave up without ever really trying. So these numbers may also be misleading in the negative direction.
You will find lots of people calling opportunities like this pyramid schemes, but are they really?
There is no denying that the HempWorx comp plan has a pyramid structure. There are 12 ranks and the commissions flow from bottom up to the small percentage at the top.
BUT... in legal terms this is not a pyramid scheme.
An illegal pyramid scheme (in its pure form) doesn't sell any products and instead relies on incoming investments from new recruits to pay off older members.
Sure, HempWorx does require you to purchase products when you join as an affiliate and many people may purchase products they don't really want in order to stay "active" and meet their required Personal Business Volume, but there is still emphasis placed on getting real customers... selling at retail price and bringing in Preferred Customers.
Because of this... because there are real customers buying real products... it is not a pyramid scheme in the eyes of the law.
Some complaints were about the products being "watered down"...
... and the customer service being "horrible"...
.. and some complaints about the products simply not working...
But overall nothing major.
*There were, of course, some complaints from people calling it a pyramid scheme but I feel I've addressed this enough.
I see no reason to believe that HempWorx products are watered down. There is no proof of this and it seems to me that the company goes through a lot of trouble to ensure that they are very high quality.
And of course CBD isn't going to work for everyone. This doesn't mean that the products are bad or that CBD doesn't work however.
The poor customers service is the only complaint that I think the company should address--because I found multiple similar complaints about this issue.
But let's not get too negative here and misrepresent the company. There are plenty of good customer reviews to be found as well...
I do have some complaints of my own however, which are typical of MLM opportunities.
#1. Overpriced Products?
They tell us that they pay 85% of their business volume to affiliates... but is this really necessary? Why not pay less and lower product prices.
Like most MLMs, it seems that the prices are higher than they need to be just to make the business opportunity look more appealing (you will be able to earn larger commissions).
#2. Confusing Comp Plan
My opinion again... but it often seems that MLM companies try to make their compensation plans confusing. They seem like they could be some extravagant and pure-genius profit system that is going to make it so easy for you to make money, but the reality is much different.
Know this: the more ways there are to earn commissions from people beneath you in your "tree", the more money people will be earning from your efforts that are above you... because you are in someone else's "tree" as well.
#3. Misrepresented Opportunity
They tell use that earning $1,000,000 per month is possible with the Binary Commissions part of the compensation plan alone... but what they don't tell us is that NO ONE has ever made this much or has even come relatively close to making this much!
The entire opportunity is always presented as much more glamorous than it really is.
I hope I haven't steered you in a certain direction. The goal of this review is to provide you with all the information you need to make a good decision on your own, whether you were considering joining the opportunity or just purchasing the products as a customer.
I would not call it one myself by any means.
The bottom line is this: The products are great quality but the business opportunity isn't so great... or at least not for most people who join.
A study by Jon M Taylor, MBA, Ph.D., of the Consumer Awareness Institute analyzed 350 different MLMs and found that 99% of people who get involved end up losing money. Yes, they do offer big potential and some people make incredibly high amounts of money as they climb the ranks, but this is such a small percentage overall. Overall the failure rates with MLMs like this are very high.
Compare this to small businesses in general, which still have a high failure rate but about 39% of them are profitable over time. 39%... that is still 39x the success rate of MLM participants.
This is why I'm personally not a fan of MLMs and stick with affiliate marketing for my home-based online business, which you actually might be interested in.
With affiliate marketing there is no sharing commissions with other people or recruitment involved. This is what I've been doing to make money online since 2015 and have been pretty successful with it thanks to the Wealthy Affiliate training program I used to learn the tricks of the trade.
I hope you found this review helpful! Please leave your comments and/or questions below and I'll get back to you soon 🙂
The CBD industry is booming and direct sales is an easy way to get involved. There a number of CBD direct sales companies out there and in this article I'll be going over what I consider to be the best.
The reason direct sales opportunities can be so luring is because you can essentially start your own home-based business without actually starting your own business--you simply join an existing business and sell their products... on your own time and on your own schedule.
Direct sales - is a marketing approach that some companies take where they avoid selling in retail stores and instead rely on a workforce of independent distributors to do the selling, which could be people like you and I.
Distributors can make sales in two ways: 1) by first purchasing products from the company at wholesale price and then reselling at a markup, or 2) by referring people to purchase online through your replicated company website.
This business model is usually combined with network marketing (aka MLM) where you can also make money recruiting others into the business and building a "team", although not always.
CBD - stands for cannabidoil and is one of 113 known phytocannabinoids in the cannabis plant. It is usually extracted from the hemp variety of cannabis and contains no THC, meaning it will not have hallucinogenic effects.
*Note: These are in no particular order and at the end I'll give my opinion on what my top 3 choices are.
Kannaway is one of the oldest and most established cannabis-based direct sales companies out there, having been founded in 2014. They are based in California and a subsidiary of the larger Medical Marijuana, Inc company.
Their management team includes a lot of experts in the industry, which is why I don't expect to see this company go anywhere anytime soon.
They source their hemp from Netherlands farmers and believe in using little refinement, keeping their products as natural as possible.
The product lineup is pretty long and they even sell non-cannabis based products, but I'll just cover some of the more popular cannabis-based products sold so that you can get an idea of what you are looking at here.
Kannaway has one heck of a compensation plan--lots of different things going on here. There are 18 ranks total and a variety of different commissions, bonuses, etc. to be earned. At most, their comp plan pays down 10 levels deep with the team commissions.
A big downside I noticed is how their direct sales commissions--in which you only earn commissions from new customers you sign up for 30 days. It's also important to know that a complicated compensation plan with a lot going on isn't necessarily better, as I'll explain in more detail at the end.
To become a Kannaway Brand Ambassador, aka distributor, you must first pay a $54.98 annual membership fee.
There is no requirement to purchase expensive product packs, which is nice to see.
HempWorx, as many people call it, is a product line inside the My Daily Choice brand, which was founded by Josh and Jenna Zwagil in 2017. The company has shown a lot of growth since its beginnings and is one of the largest competitors in the direct sales CBD oil industry.
Out of all the CBD products I've seen from direct sales companies, these rank at the top of my list--not just because they are good quality but also because of how creative some of these products are. As a distributor you will be able to sell a range of products, including:
Binary commissions, check matching, "refer 3 and it's free", jump start bonuses, 12 different ranks... what you have here in the HempWorx compensation plan is pretty typical for MLM direct sales opportunities.
The cost to join ranges from $39 - $299.
The cheapest option is the 'Pet Pack', which includes the HempWorx pet products, but many people might not be interested in this. The Builder Pack is the lowest cost option that most people will be able to use, which consists of nothing more than a dropper bottle of their Full Spectrum CBD Oil for $69.
Changing The Future Outcome, or CTFO for short, was originally launched in 2015 as a weight loss direct sales company (where CTFO stood for "Chew The Fat Off") but has since made a strange transition to a CBD direct sales company. I guess the founders decided to jump on the rising trend of CBD and seize the opportunity... not sure. But it doesn't matter much how this company came to be... the point is that it is a large and well known company in the CBD industry.
CTFO's product lineup is pretty long, so I'm not going to be covering everything here, but the following will give you a good idea of what they offer.
As you can see there are lots of beauty CBD products here, making this opportunity more appealing to women.
One thing that is nice about CTFO's compensation plan is that it is fairly straightforward and not as confusing as most... which usually are confusing as all heck just to appear better than they really are. With this comp plan there are 4 ways to earn, that's it.
The cost to join CTFO is free, which is nice. However, in order to become an "active qualified associate" you have to either a) purchase $47.47 worth of products yourself, or b) maintain a personally enrolled customer base or associate downline of at least 10 people.
So is it really free? You decide.
CBD BioCare was founded in 2016 by Matthew and Stacey Pitts, who love what they sell, not people just looking to jump in on a new popular opportunity. Apparently they had long been fascinated with the health benefits of cannabis, largely due to a friend of Matthews who had found comfort from cannabis while suffering from cancer.
As their name suggests, this company is focused specifically on CBD, which is all comes from organic crops in the USA.
The product lineup here is fairly similar to most. You have plain oils, skin products, capsules, gummies and pet products.
The compensation plan for CBD BioCare is as simple as it get's... the most simple of those listed so far. There are only 3 different ranks and several ways to earn... AND there is no MLM structure. This is direct sales without the pyramid-like MLM part.
You will be able to earn 10% commissions from your direct recruits into the company but there is no need to build a "team" or anything like that.
They have 4 options to join, ranging from $0 to $349.
The $0 option will give you access to the online sales dashboard where you can track sales and commissions, but that's it. The higher priced options give you customized landing pages you can send customers to, coupons you can give customers to encourage sales, and CBD products.
Zilis, Swahili for "multiplying nutrition", was founded in 2015 by Steven and Angie Thompson, two entrepreneurs with years of business experience. They don't have all that many products but seem to be a trustworthy brand that really makes an effort to only put out the highest quality products they can.
Their product line consists of what they call ULTRA products. These include:
In the Zilis compensation plan there are 11 different ranks and 7 ways to get paid. It is a fairly typical MLM compensation plan.
The minimum cost to join Zilis is the membership fee of $99. However, you will be pushed to buy some of the more expensive product packs.
The Bronze Starter Pack costs $199, the Silver Starter Pack costs $599, and the Gold Starter Pack costs $1,299... pretty darn expensive.
HB Naturals was founded in 2017 and is has a large focus on the CBD industry, although they sell other products as well. Everything is GMO-free, organic and grown on Kentucky farms.
HB Naturals has a lot of products and isn't specifically focused on CBD products. They also sell superfoods, biominerals, beauty and pet products... but I'll just be going over some of the hemp-related products here:
The HB Naturals compensation plan is, once again, typical of a MLM. You have 7 ways to earn which consist of binary commissions, matrices, bonuses, etc.
There is a free membership so that you can join at no cost. However, you will not be given anything really, no website, etc.
There are paid options too I imagine.
This company was founded in 2015 by Paul Rogers and Brian Cummings and is headquartered in Texas. They are easily one of the top competitors in the CBD MLM industry and have a strong management team--and take a lot of pride in product quality, which is the reason they have a Medical Advisory Board.
The product line here is pretty good , as I would expect from a company like this (but short). They have your normal extracts, skin products and more.
Prime My Body's compensation plan has 10 ranks, lots of focus on team building, bonuses, etc... nothing new here.
To join the opportunity the cost is only $39, which gives you your own PMB website, app, discount products and access to the compensation plan--which I don't think is too much money.
However, they do push you to purchase product packages which range in price from $267 to a massive $1,068.
Launched in 2018 by David and Debbie Reeder, Liv Labs is a direct sales company that sells organically grown hemp products, all of which are grown in the US and certified THC free.
These products are typical, but they also have some pet products that most companies don't offer.
LivLabs' compensation plan is very deep when it comes to MLMs, and one that is really spiced up to look as amazing as possible. There are 12 ranks total and with their VIP Residuals commission structure you will be able to earn down 12 levels.
Joining this direct sales opportunity is not cheap, and is a bit too pushy in my opinion. You will have to purchase one of their many product packs, and these range in price from just under $300 to $1,000.
With the more expensive product packs you are also purchasing a rank. You are essentially buying products and a higher rank in the company, so that you can make more money.
Additionally there is a $47/yr membership fee.
TREVO was founded by Mark and Holli Stevens (I'm not entirely sure when) around one signature health drink product that boasts 174 ingredients, but has since expanded it's product line. They have a network marketing/direct sales business model combo like most.
TREVO only has 3 products and their main product is actually a drink that contains a whopping 174 natural ingredients and is said to be "unlike any other nutritional supplement you will find".
This certainly isn't a good opportunity if you are looking for a long lineup of CBD products and lots of options, because they only have 1 CBD product and only 3 products total. However, these 3 products are good quality and are all products that CBD consumers might be interested in.
The TREVO compensation plan is actually a bit confusing, and they make it this way on purpose to try to make it seem better than reality. Once you get down to it, however, it's nothing special.
There are literally dozens of different 'business systems' available for you to purchase when you start out, and no free option to join. These range greatly in price and include different things. The cheapest options are $150 and they go all the way up to $960.
One thing to consider before joining any of these opportunities is the level of difficulty there is to succeed and high failure rates. With large studies like that done by the Consumer Awareness Institute that looked at 350 different MLMs and concluded that 99% of people that get involved end up losing money... it's no wonder that there is so much negative attention surrounding the industry.
A fancy and extravagant compensation plan with loads of different way to earn money may look better, but often times it isn't.
The fact of the matter is that the very structure that makes these sorts of opportunities so enticing and so potentially lucrative is the same structure that makes them so difficult. The pyramid structure is what I'm talking about here, which favors a small percentage of distributors at the top and makes it more difficult for those at the bottom... which is why these opportunities are labeled as pyramid schemes by some people.
To make it in this business you have to recruit and build a team... and you have to be darn good at this.
An Alternative Choice would be to get involved in something like affiliate marketing, where there is no "team" building or recruitment and you earn full commissions from your sales instead of sharing them with people above you.
If interested I would highly recommend the Wealthy Affiliate training program to start out, which is the best there is... and they have a free starter membership which is absolutely amazing for beginners.
Take care and please leave any of your comments or questions below. I'll get back to you soon 🙂
With all the glitz and glam surrounding the Avon opportunity, it may seem like the greatest job ever.
Financial freedom, driving around in a pink Cadillac, working when you want from home... it sounds like a dream job.
But is it really? Well, no... at least not for the overwhelming majority of people who get involved.
The big question that needs to be answered is: how much do Avon representatives make?... or better yet... how much does the average Avon representative make?
As I was reading different articles online I noticed that a lot of them are from people who work as Avon reps and, because of this, seem to be giving somewhat of a biased opinion.
I've read things like the amount you can make "is totally up to you" and "there are no limits to how much you can make"--and while these statements are both true to some extent, they give people the wrong idea.
So anyways... in this post I'll be giving possibly the most realistic breakdown of how much Avon representatives make that is on the internet.
Enjoy... and be prepared to be disappointed.
Avon is a beauty supplies company that, instead of selling products in a retail setting, relies on a workforce of independent representatives to do the selling, which is why anyone can join the opportunity.
And as I'm sure you are already aware, the products sold by Avon include lipsticks, lotions, soaps, mascaras, eyeliner and a whole lot more.
It is one of the oldest lasting businesses of this kind, first starting out back in 1886 by a man (strange, I know) named David H. McConnell.
Having been around for so long it must be a pretty good opportunity, right? After all, it is promoted as being a way to "work from home. Anywhere, anytime." and is said to be "your dream gig".
The MLM business opportunity is so luring because of the freedoms it offers and how easy it is to get started (to get started... not to make money!). As an associate for Avon (aka representative) you essentially are your own boss, working when you want. And the cost to get started is only $30 to purchase a Starter Kit.
Sounds like a no-brainer...
Ya... well don't get too excited. The ugly stats I'll go over in a second will show you the reality of being an Avon associate.
As an associate you will, in a nutshell, be earning money in 2 main ways:
Earning your own commissions selling products yourself (can be done online and offline) is great and all, but unfortunately it isn't going to get you to the point of earning big money and driving a pink Cadillac. In order to make it to this point you will have to claw your way to the top, which means recruitment will have to be a priority on your daily to-do list.
You will have the potential to earn commissions from the efforts of those beneath you down different levels and generations, which in laymen's terms means that you can earn money from the people you recruit in, the people they recruit in, the people that those people recruit in, and so on.
This is called MLM (multi-level marketing) or network marketing because the recruitment structure of the business encourages building different levels, or a network.
The compensation plan places a great deal of incentive on recruiting more people and building a "team", so if you plan on taking advantage of the earning potential at hand, you will need to do this.
Okay... so you can make up to 40% commissions selling products on your own and can also recruit others in and earn from their efforts... as well as the efforts of those recruited in beneath them... sounds like a lot of potential to earn money here, right?
Well, I suppose there is a "a lot of potential", but the reality is that most people hardly make anything.
Are you ready for some hard numbers?
Unfortunately Avon doesn't disclose any sort of income chart on their own. After doing a little digging around online and Googling, I was able to find two income disclosures from 2008 & 2009 on SequenceInc, which is a pretty reliable source and often helps bring earnings disclosures for various opportunities to the public eye.
The 2009 statement reads that :
That is pretty bad... a very small percentage of people are making enough to live off of. And to make matters even worse, these statistics are somewhat misleading because they are also only from associates after one year working with Avon.
So this means that all of the associates who joined Avon and quit within a year are excluded from these statistics, which I can pretty much guarantee make up well over 50% of the total number of associates. And what this means altogether is that if all associates were included here the numbers would look a whole heck of a lot worse.
Why doesn't Avon disclose the average earnings of associates like some other MLM opportunities do?
Well, I don't know for sure, but I would suspect that it has to do with the statistics being absolutely horrific, so much so that if any reasonable human being were to see them they would probably stay far far away.
Note: Some MLM's do disclose the average earnings of associates for legal reasons. These disclosures are never pretty and always show a very small percentage of people making the majority of the money, which is why they are usually presented in a very misleading way and/or hard to find on their websites. doTERRA & Young Living, Ambit Energy, Tupperware, etc.... it's the same story with all of them.
There is no doubt that a lot of people simply give up to easily and too early. And unfortunately because of this when you see the statistics for some MLM's, which look absolutely horrible, it's hard to get a clear picture of how much people are really making because these quitters throw the numbers off.
People give up early because 1) this business model is extremely hard to succeed in, and 2) they don't have much at stake so there isn't much lost if they quit. It might be different if you had to invest some serious capital to get going, but you only need $30 to buy a Starter Kit to get going with Avon for example.
The other reason the so few people make good money with MLM's like this is because of the very structure that they have, which pretty much ensures this is the case.
What gives these kinds of opportunities so much potential to make big money also makes it incredibly difficult to make money.
At the core of every MLM is a pyramid structure like this...
You recruit in people beneath you, they recruit people in beneath them, and so on. It starts out narrow and branches out near the bottom naturally as people recruit more and more.
This is great, right? Now that you have people beneath you, you are earning commissions from their efforts. The money flows up the pyramid.
In the Avon compensation plan you will be able to earn Generation Bonuses down 5 generations and Leader Bonuses down 5 levels.
So for example: With the Leader Bonus you will be able to earn commissions from the people that you recruit in (level 1), the people that they recruit in (level 2), the people that the level 2 people recruit in (level 3) and so on.
Sounds Great, But Think About Those at The Bottom
With a pyramid structure like this there will always be more people at the bottom. This is just how it is.
And guess what? These people will be having potential commissions sucked away from them to pay those above them.
Avon could be paying associates more for their own retail sales, but instead rewards their sponsors, and their sponsors' sponsors, etc.
It is this very reason that makes MLM's an incredibly difficult opportunity to succeed with. If you want to make good money then climbing your way to the top is a must, and this is achieved only by recruitment... and a lot of it.
Some Stats Say That 99% Of Those Involved Lose Money
In a study conducted by the Consumer Awareness Center, they claim that about 99% of people who join MLM's end up losing money. Avon happened to be one of the 350 MLM opportunities that was looked into in this study.
Now I don't think they accounted for all of the people that simply gave up to early, but even if they would have I imagine the numbers would still be terrible.
Pyramid schemes are illegal and since Avon has been in business for years, I think it's pretty obvious that it isn't a pyramid scheme, at least in the legal sense of the word.
A pyramid scheme doesn't sell any products and instead relies on the incoming investments of newcomers to pay off older investors, whereas a legitimate MLM does sell real products and this is where all their revenue comes from.
The difference does get a bit shady at times, because many MLM's force new associates to purchase products and much of their product sales aren't to real genuine customers, but I'm not going to get too into this.
Yes Avon does have a pyramid structure. No they are not a pyramid scheme.
I'm not going to tell you whether or not you should join because this is something you have to answer for yourself.
I hope to have given you a more realistic look into the earnings of Avon associates so that you can see the reality here, which isn't as good as many are led to believe.
The bottom line is that the compensation plan favors recruitment a great deal and if you want to take advantage of this opportunity then recruitment is a must. And something else that I didn't really make clear is that MLM's have extremely high turnover rates [more info here] and because of this you will have to be constantly recruiting more people in.
What do you think of Avon's business opportunity? Leave you comments and/or questions below and I'll get back to you soon 🙂
PS: If you are looking for a good opportunity to make money from home on your own time, I would highly recommend checking out this program that I use (and have been using since 2015).
Alternatively you can see some of my top picks for making money from home here.