It’s true, there are some people who know that it’s either a scam or a pyramid scheme, but the answer in short is no – it is neither. Misunderstood perhaps, but most definitely not a scam.
Surprisingly, many people who know that it’s a scam, can’t explain how a pyramid scheme actually works. I’ll explain in more detail below, but if it was a dodgy scam company (or indeed, an illegal pyramid scheme), there are several facts which should dispel that particular myth. So, let’s take a look at some facts about Forever Living Products (FLP) ……
Fact 1 – Recognised Business Model
FLP operates under a business model called Network Marketing, also known as Direct Selling or Multi-Level Marketing (MLM), which is little understood, sometimes feared and often mistaken for illegal pyramid schemes. Some of the better-known examples of this type of business model (in the UK) include Avon, Pampered Chef, Tupperware or Kleeneze.
Fact 2 – 35 Year Trading History
FLP has been trading since 1978 and more than 9.5 million people in 150+ countries worldwide, build businesses for themselves using this business model. Worldwide turnover in 2010 exceeded $2.5billion. Scams or illegal companies don’t usually last this long.
Fact 3 – Professional Integrity
FLP in the UK holds both the Investor in People Gold Award & Champion Award. FLP also is a member of the Direct Selling Association (DSA) In fact, the UK Managing Director of FLP is a Board member of the DSA.
Fact 4 – Little or No Risk Opportunity
After a year, if you decide that the business is not what you expected and you wish to give up, you can return any unopened product and receive 90% of your money back. It is as close to no-risk as possible.
Fact 5 – You Can “Overtake” The Person Whose Team You Joined
If you dedicate enough hard work and commitment, it is possible to earn and achieve more than the person whose team you joined.
Fact 6 – You Need End Product Consumers
You can create a good income from simply recommending a physical product (high quality aloe vera products) to a customer base – it is not solely dependent on you recruiting people into a team.
True network marketing is fast becoming the business model of the 21st century. This short BBC News video shows how companies such as Virgin, The Body Shop, Dell and many more are using network marketing. It is now taught in most major business schools and increasingly acknowledged as a viable way for people to start their own business, without having to risk an existing job or make any significant initial investment.
Forgetting for the moment, the fact that every company you’re ever likely to work for will have a pyramid-shaped hierarchy, the edited highlights of how an illegal pyramid scheme goes something like this:
- Person number 1 (top of the pyramid) finds person number 2 to “invest” £100 (which is paid to the recruiter)
- Person number 2 (in order to make their money back) must also encourage more people to each invest £100 – if 10 people invest, then the “profit” is £900
- Each of those 10 people, in order to get their money back must also recruit 10 “investors” and so on.
- This works “well” until there comes a point where there simply is not enough people in the world in order for everyone to make the same profit and the bottom tier of the pyramid collapses as it cannot sustain the levels above it. No products have changed hands, no service has been provided, no investment has been made and no wealth has been created
Granted, there ARE similarities between this business model and illegal pyramid schemes (in as much that they operate in multiple levels of team members) and it is not difficult to see how the two can become confused, but compare these FLP facts against the typical characteristics of illegal schemes:
- Do not generally sell end products to consumers – members are only paid based on the number of people they sign up, however, this becomes unsustainable beyond a certain level (as there aren’t enough people on the planet!)
- Don’t offer a refund on any startup kits or membership fees
- You cannot overtake the person at the bottom of the pyramid
- Vague information is available about the company and is usually only available upon payment of a fee
But it still sounds like the people at the top are the only ones who earn all the money
A common misconception of network marketing is that there is one person sat at the top, recruiting people to do all the work and they sit back and “let the money roll in”. The business model does not operate like that; no-one is paid more than you in your team. If you work hard, you will earn more – some people are achieving more in their first year than people who have been in the business for 10 years! Quite simply, you get out what you put in. If you’re looking for a get rich quick scheme, then this is NOT for you.
My friend tried network marketing, but it doesn’t work
If 20 people set out to learn how to play the piano, would all 20 of them succeed? Probably not? Does this mean it is not achievable? The tools, training and support system is in place for you to follow, but, like everything worth achieving, it does require time, effort and hard work. All you need is a willingness to learn, self motivation and a desire to succeed – people not willing to work will not achieve. It really is as simple as that. A bad workman will blame his tools, but is this really where the blame should lie…..?
If you are interested to learn more about the opportunity with Forever Living Products, please complete this short form and Michelle will be in touch for a short chat.