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Is Herbalife A Scam? Popular Brand Accused As A Sophisticated Pyramid Scheme In Disguise?
Welcome to My Herbalife Review!
We’ve reviewed more than a dozen multi-level marketing (MLM) companies in the past, both new and old, and there’s this name that I always encounter -- Herbalife. Perhaps this health and wellness brand commonly known for its nutritional shakes has really made a huge impact both on its users and members.
Herbalife Review Summary
Founders: Mark R. Hughes
Product Type: Multi-Level Marketing
Price: $94.10 To $124.10 For The Business Kits
Quick Summary: Herbalife is a well-known MLM company that sells protein shakes and other essentials for the skin, hair, and health. It’s founded in the 1980s and until now, it’s one of the most popular brands in the fitness industry.
Overall Rating: 5/10
But is the impact more of a positive or negative thing?
What is this program all about?
Moreso, despite being one of the longest operating network marketing companies, is Herbalife a scam or a legit program?
Let’s find out all the details you need in this unbiased Herbalife review.
What Is Herbalife About?
Herbalife is a network marketing company under the health and wellness niche but unlike typical MLM stories, the founder had a rough start.
Also known as Herbalife Nutrition, the brand was founded by Mark R. Hughes in February 1980 from the trunk of his car. Instead of the usual physical offices that most MLM companies have nowadays, the founder has started selling his weight management product from his vehicle’s boot.
Just a quick history: his wellness program was inspired by his mother’s premature death because of an unhealthy lifestyle.
Anyway, what Mark would have wanted is just a simple platform where he can sell his products, such as protein shakes but after a few years, he has built an empire.
As of 2018, Herbalife has $4.89 in revenue, 296 million net income, and is publicly traded as HLF in New York Stocks Exchange. Originally from Los Angeles, California, the brand was also able to expand its business to over 90 countries in the world.
However, along with its success, Herbalife has faced a lot of allegations, such as being an alleged “sophisticated pyramid scheme” but we’ll discuss more of that in a while. For now, let’s talk about their core products.
Herbalife Product Line
Unlike its biggest competitor, Amway, Herbalife only depends on its members when it comes to selling their products. They don’t distribute it in any retail store but with over 4 million distributors, I don’t think they’ll have any problem with that.
The brand has more than 50 products to choose from but basically, it’s divided into 4 categories:
This includes their famous protein shake, nuts, multivitamins, and weight management programs.
This includes the supplements that claim to support women’s health, men’s health, heart health, aging health, children’s health, and digestive health.
Energy & Fitness
This includes the supplements for athletes to increase performance and faster recovery.
Skin & Hair Care
This includes moisturizers, shampoos and conditioners, cleansers, and other essentials that promote healthy and clear skin.
Like typical MLM companies, their products are overpriced. For instance, their protein shake costs around $30. But the question is: is it worth the price?
I’ve personally met people, most of which are not distributors, who have tried Herbalife products and although they complain about the price, they liked the results. I was almost persuaded to try their protein shakes but then it was too pricey for me.
Anyway, I think the product is subjective when it comes to losing weight, and also, I know that the nuts and protein shakes alone are not enough to trim down. Having a healthy lifestyle offers a better, cheaper option if you want to reduce fats.
And of course, there are negative reviews about the products, too and I’ll share a few screenshots below:
How To Make Money With Herbalife?
To make money with Herbalife, you have two main options: sell the products and invite people to join the platform.
As a distributor, you have access to the wholesale price of their products so you can sell them based on their suggested retail price (SRP). From this, you can earn a 25% to 50% commission, depending on your level or rank.
You’ll also earn from the sales that your downline makes, thus the need to invite. The concept is that the more people you have under your team, the bigger the chance to make more sales. This will also give you a chance to earn from personal and team bonuses.
Your recruitment will also qualify you for vacation bonuses and if you reach the top of the pyramid, you can also earn a certain percentage of the company’s annual revenue.
To learn more about Herbalife’s compensation plan, you can watch the video below:
Is Herbalife A Scam?
Herbalife is a scam. It’s been in the industry for 40 years and has gained a good reputation worldwide. It’s recognized and many celebrities and public figures have endorsed their products, such as David Beckham.
However, it has faced a few charges, too. In fact, it was even sued by the Federal Trade Commission.
In 2017, Herbalife settled $200 million with the FTC after pyramid schemes allegations. Along with the settlement, the brand also agreed with readjusting its compensation plan.
You see, no matter how legit the company is, if it’s heavily focused on recruitment, there’s a huge chance for it to be shut down simply because it’s similar to how a Ponzi scheme works.
It’s illegal and a lot of MLM brands did not have the same fate as Herbalife; instead of having a second chance after a settlement, they were closed for good. Some of these include MOBE and Digital Altitude.
Just to be clear though; recruitment is normal for MLM companies. However, if the compensation plan heavily focuses on it or worse, the member is paid directly for the recruits, then most people and even agencies will see it as a scam rather than a legit program.
To become a member or distributor of Herbalife, you have to purchase any of the following business kits:
- International Business Pack $94.10
- Super Starter International Business Pack $$124.10
These kits include access to the wholesale price of the products, training resources, and other materials you can use to grow your business.
Unlike the typical networking companies, Herbalife’s fee is cheaper; however, it includes only a few products so more or less, you’ll spend another hundred dollars to earn more.
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Despite the negative reviews, the brand has undeniably successful products. It’s been promoted worldwide and some people are really purchasing and re-purchasing it. Also, there are well-known public figures who are promoting Herbalife and although we all know they are paid to do it, their reputations still depend on it so I guess they have to think twice first before they sign up as ambassadors or endorsers.
This is normal for MLM companies as they use part of their profit to provide incentives and cash bonuses to their members. However, if the product has nothing but bold claims then I guess the price is not worth it.
With Herbalife, it’s 50-50. I mean, I’ve seen positive and negative reviews so it depends on the user. But as I mentioned above (and perhaps fitness experts will agree to this), losing weight depends on your lifestyle.
Even if you purchased the most expensive weight shake or program, if you don’t have a balanced diet and regular exercise, then it’s useless.
Low Income Potential
If you’ll look at their Income Disclosure Statement, it says here that 50% of their distributors earn more than $95 a month, and if you’ve been working for your whole life to manage your finances, you know that’s barely enough.
It’s not a surprise though because 1.) the products are expensive and 2.) MLM has a negative stigma. Even if the opportunity is legit, it’s hard to recruit people because they see networking companies as downright scams and if you haven’t invited anyone to be part of your team, you won’t be able to earn commissions.
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Who Is It For?
Herbalife is ideal for those who have tried to sell similar products in the past or have experience with MLM.
Network marketing is an attractive opportunity because of the cash bonuses and travel incentives; however, it’s not easy. Unless you have the necessary skills and expertise, you are less likely to become successful with it.
Also, if you’ve tried their products and you love how it worked on you, maybe you can consider distributing their products for extra income.
Herbalife is actually one of the MLM brands that I liked… before. However, after learning about the allegations, I have second thoughts about it. I thought that they’re more of a direct selling company that focuses on selling their products since they have competitive essentials.
However, they’re focused on recruitment and you know what’s the worst part about it? Members become more aggressive in recruiting other people for the sake of commissions and bonuses. Sometimes, they might become too intimidating and I’ve personally experienced this.
Also, the income potential is not promising because based on the Income Disclosure Statement, the average earning per month is around a hundred dollars.
Perhaps you can consider Herbalife or other MLM programs as side hustles but if you’re expecting a decent income that can help you and your family survive, I suggest that you consider my top-recommended program.
Unlike networking companies, you are not pressured to buy products every month or recruit people aggressively. You also have access to the following tools and support for your own growth, such as:
- Training resources
- Webinars to help you start your business online
- One-on-one coaching
- Comprehensive guide
- And many more!
I hope that you find this Herbalife review helpful. If you have questions or comments, please feel free to share it below.