Many people wonder when reviewing Herbalife for the first time, “Is Herbalife a scam?” and for good reason. Unfortunately, the home business world is overwhelmed by misleading or even downright bogus claims of people making huge amounts of money with apparently no skills, time or effort required, so it’s important to do your research when evaluating Herbalife or any other company to work with to make sure it’s a legitimate opportunity.

Is Herbalife a Scam or Legitimate Business?

Herbalife was founded in 1980 by Mark Hughes who started the company by selling its original weight loss product out of the trunk of his car. Mark had gained his drive and inspiration to spread what would become Herbalife’s weight loss message from the untimely death of his mother, which he blamed on an eating disorder and an unhealthy approach to losing weight. From those humble beginnings, the company has grown to a publicly-traded (NYSE: HLF) network marketing giant with over $4.3 billion in sales for 2010 and 2.1 million independent distributors across 75 countries worldwide.

As you can see, Herbalife is a completely legitimate company that is publicly-traded and does billions of dollars in sales across the globe. As great as those numbers are, it might also be one of the driving factors behind a small, yet vocal group of people which claim that Herbalife is a scam, but I’ll get to that in a moment.

Review of The Herbalife Compensation Plan

With Herbalife, there are actually five different ways that people earn money as distributors:

• Retail profit ranging from 25%-50% for selling Herbalife products to end customers.
• Wholesale profit of up to 25% between the difference of what you pay for the products, based on your level in the company, and what your downline purchases them for.
• Monthly TAB Team Bonus of an extra 2%-7% on the overall sales volume of your Herbalife organization.
• Monthly override payment of up to 5% on the personal sales volume of your “supervisors” in your first three generations.

At the end of the day, the company claims to pay out up to 73% of their revenue with the intention of having one of the most generous compensation plans in the network marketing industry. At first, I was skeptical about those claims, but at up to a 73% payout at the top levels of the Herbalife compensation plan, that is actually pretty good. Most network marketing companies structure their target payout range in the mid sixties or so as a percentage of revenue, so when you can potentially earn over 70% of the sales that you personally generate, you’re doing pretty well – if you’re personally producing a lot, that is.

So why do the vast majority of active leaders in the company earn less than $825 per year on average? Is that why so many past distributors are claiming Herbalife is a scam?

When it comes down to why someone is going to say something negative about Herbalife, or really any home-based business, you typically have to dig a little deeper to determine why they’re saying Herbalife is a scam.

When someone says that a network marketing company is a scam, it’s either because they didn’t make any money or they didn’t make millions their first month and decided to call it quits. That’s basically what it boils down to.

What you have to keep in mind with this industry is that you’re really only paid to do two simple (not to be confused with easy) things: You’re paid to sell a product or service, and you’re paid to recruit and train people to do the same. That’s all.

While it’s not Herbalife’s fault if a distributor doesn’t make any money because they choose to spend all of their time checking email and studying the product catalog instead of talking to people about buying their weight loss products or becoming a distributor themselves, they’re not totally off the hook either.

Like so many other MLM’s today, their entire training program is centered around building a list of your friends and family, getting them to a hotel meeting, and signing them up. It’s not that approach that’s necessarily wrong, since thousands of successful businesses have been built doing just that, but it presents new Herbalife distributors with the problem of not knowing what to do if their best friend and brother-in-law doesn’t want to join their business.

With no other prospects to talk to, these people give up and say “Herbalife is a scam” when all they really needed was an MLM recruiting system and some modern day marketing training to give them an avalanche of prospects that would love to hear about their business.

Herbalife is NOT a Scam

With over 30 years in the network marketing industry and positive track record of resolving complaints, I think it’s safe to say that Herbalife is not a scam. Now it’s up to you to determine if it’s the best business for you and your family, or if you should consider working with another MLM company.

Disclaimer: I am NOT affiliated with Herbalife in any way and am providing my opinion based on my time spent in the network marketing industry and my understanding of the company.

 

Brian Rakowski

MLM Coach/Online Marketing Ninja

512-850-4857

P.S. – If your sponsor doesn’t already have a proven system in place to help you generate 3-10 leads per day from Facebook and Twitter for your business, you might want to check this out.

Popularity: 14%

Despite its 55+ year history, a question that I get asked all the time is, “Is Shaklee a scam?“, and smartly so. Even though it’s a very small minority of companies, you have to do your research to make sure that any company that you’re considering joining is both a legitimate business and that it offers a high quality product which you can stand behind as a business owner. Do they make the cut?

In-Depth Reviews To See if Shaklee Is Another Scam or Legit

Shaklee is a corporation based out of Pleasanton, CA which manufactures a wide variety of natural health and environmentally friendly aka “green” products ranging from  high quality vitamins and supplements, cellular anti-aging, natural weight loss, personal and skin care, and biodegradable cleaning concentrates.   Even though the company is the #1 natural nutrition company in the U.S. based on sales, they were also the first company in the world to be certified “Climate Neutral” (meaning they offset all their CO2 emissions and a zero net impact on the environment), which to me at least is extremely impressive.  Shaklee is proof that a company can do well financially while at the same time doing good for the environment. I’m looking at you, Monsanto…

Shaklee’s History

The company was founded in 1956 by Dr. Forrest Shaklee after spending  over 40 years researching vitamins and minerals and how they help promote health.  At the time, taking vitamins wasn’t a common practice in the U.S., so they chose the MLM business model to market the product directly to the consumer on a one-to-one basis. Starting in the early 60′s, Shaklee started manufacturing Basic-H, a biodegradable plant-based cleaning concentrate, which has remained one of their most popular products even to this day.

In 2004, the company was purchased by billionaire investor and current CEO, Roger Barnett, who has overseen Shaklee’s current meteoric growth phase with their products being featured on The Rachael Ray Show and even as one of Oprah’s “Favorite Things”. So far, so good right?

Does Shaklee Have a History of Scamming Distributors or Customers?

In my experience with network marketing  training, I’ve seen that most of the time when someone claims that a company is a scam, it’s because they were a former distributor that didn’t receive any real marketing training beyond “go talk to everyone you know”. Sure, talking about Shaklee or any other business with your friends and family is something that I recommend you do, but I don’t think a company should base its entire training program on talking to your best friend and brother-in-law. Does that make sense?

Just to be safe though, I checked into the company reviews with the Better Business Bureau to see if Shaklee has a history of  “scam complaints” or anything like that, and I’m happy to say that they currently have an A+ rating.

Is Shaklee a Scam?

From my research and experience, I would say NO. Here are a few points that I’ve considered:

• Shaklee has been around for over 50 years. The real scams don’t last anywhere near that long before they’re discovered and shut down.
• They offer a real, tangible products and is even the official nutrition sponsor of the US Olympic Ski Team. Pyramid schemes, like Bernie Madoff ran, don’t actually sell a real product or service.
• Shaklee products are used by NASA and have even been endorsed by people like Rachael Ray and Oprah who have entire teams that watch out for possible scams.
• They do business in 7 countries, so it’s unlikely that they would be able to fool 7 different governments. Wouldn’t you agree?
• Shaklee has spent over $250 Million on research and development for their products. They’ve published numerous studies in peer-reviewed scientific journals which outline the effectiveness of their products.

Shaklee Is NOT a Scam

To be fair, in order to be successful in Shaklee, or any other network marketing company for that matter, you have to learn how to market your business outside of your friends and family. This often neglected fact is, in my opinion, the major reason why many people think companies like Shaklee may be a scam. They dive into a business thinking they’re going to make millions, and when their best friend decides not to join right away, they run out of people to talk to and end up quitting a few months later.

My recommendation is to discuss how your potential Shaklee sponsor is going to help you effectively market your business (my preference is online, but there are many ways to connect with people who are actively searching to join your business) once you’ve spoken with your warm market. If they can’t give you a good answer, then you might consider using a network marketing system to build your business or even finding another sponsor who can show you how to market your Shaklee business effectively.

If this has helped you, please leave me a comment below or share with your friends!

To YOUR Unlimited Success,

Brian Rakowski

Online Marketing Coach

512-850-4857

P.S. – Check this out if your upline doesn’t already have a complete turnkey system to help you generate a massive amount of leads for your business.

Popularity: 79%