4 ms·

I have no idea how you're supposed to find this organically; Here's the PDF that tells the tale: https://opportunity.herbalife.com/Content/en-US/pdf/business-o

by csours 6y ago

I have no idea how you're supposed to find this organically; Here's the PDF that tells the tale: https://opportunity.herbalife.com/Content/en-US/pdf/business-opportunity/StatementAverageCompensation2011EN.pdf https://opportunity.herbalife.com/Content/en-US/pdf/business... In 2011, in the US ~351,000 people were on the roles as individual sellers. The pdf even acknowledges "Single-level Distributors benefit from buying Herbalife products at a preferred price for their consumption and that of their families, and for many this is the only benefit they seek." Those 351,000 people are the product for the "Supervisors" Here's another one for 2013: https://opportunity.herbalife.com/Content/en-US/pdf/business-opportunity/statement_average_gross_usen.pdf https://opportunity.herbalife.com/Content/en-US/pdf/business... 400,000 people who earned nothing at all from herbalife as individual sellers (they could potentially profit from selling product, but that's quite rare, it looks like 50,000 people bought more than the minimum [see footnote in pdf]). Next, 43,000 people who could potentially earn money from their downline (see the 400,000 chumps above); but only 2,300 actually did earn anything at all. Next, the actual winners in the pyramid: 73,000 people at the top. But wait, 18 percent earned $0 and another 56% earned $250 on average. So how many people in the pyramid earn above minimum wage? Something like 2,600 people.

IncRnd 6y ago
Multi-level schemes are configured in order to benefit the people at the top. That is why they were created.
dmurray 6y ago
This is reassuring, if anything. Those numbers make it sound like it's mostly just a business with an unusual sales and marketing mechanism. The vast majority of the customers aren't taking part in the "pyramid scheme" part of the enterprise. They're just buying herbal supplements because they make them feel better or maybe their neighbour pressured then into it. All slightly skeezy but no worse than most retail businesses selling discretionary items. It would be much worse for society if most of the "individual sellers" were buying large quantities of the useless product, intending to sell it on but never being able to. What proportion of people in the distribution/consumption pyramid for Coke earn above minimum wage from distributing or consuming Coke? Surely a lot fewer.
- deleted 6y ago
  [deleted]
- gruez 6y ago
  >The vast majority of the customers aren't taking part in the "pyramid scheme" part of the enterprise. They're just buying herbal supplements because they make them feel better or maybe their neighbour pressured then into it. All slightly skeezy but no worse than most retail businesses selling discretionary items. That's one interpretation. The other interpretation is that herbalife has reached a saturation point where there aren't any suckers to sign up anymore, and all the "customers aren't taking part in the 'pyramid scheme'" are just the bag holders.
- jjeaff 6y ago
  I'm guessing all those people buying it at the bottom are doing so to meet monthly minimums. Judging by my experience trying the product, I can't imagine people really want it that bad.
gamblor956 6y ago
Herbalife's products work, but they're just vitamins, and a protein shake with vitamins. It's nothing special compared to the hundreds of competing products that exist...today. But when it was founded 4 decades ago...there weren't any products like it on the market. It basically created the market, and it's had 4 decades to expand internationally into countries where there is similarly little to no competition. It's basically the McDonalds of protein shakes. Herbalife stays in business because most of the "distributors" (in the US) are just end customers who buy in bulk at the "distributor" discount, which is why so many of them don't try to sell it on to others. And that was pretty much what the FTC concluded when they investigated Herbalife. (But note: Herbalife was determined to have operated as a pyramid scheme in several Latin American countries, and was forced to reorganize its operations in those countries.)
- athms 6y ago
  >But when it was founded 4 decades ago...there weren't any products like it on the market. Nonsense. There have been vitamins and protein drinks sold in stores for over 50 years. Every drug store and most grocery stores carried vitamins since the 1940s. The One-A-Day multivitamin brand appeared in 1943. My parents were born in the 1940s and they took vitamins as children. I was born in the 1960s and I took Flintstones Kids vitamins, which ere introduced in 1968. Protein powders started showing up in drug and health food stores in the 1950s with the advent of body building becoming popular. GNC was started in the 1930s and was in every major mall across America in the 1970s, and they sold protein drinks, both liquid and powder. Remember Charles Atlas? Probably not. There have been multiple health food fads throughout American history. Herbalife stays in business because people are gullible. The multi-level marketing business model appeals to our greed and fear of missing a good deal. None of the products offered by Tupperware, Avon, Mary Kay, Fuller Brush, Amway, and Primerica are unique in anyway and the only people getting rich are towards the top of the pyramid.
  - perl4ever 6y ago
    I'm struck by the unwillingness of people to say they don't know what's going on. But total disagreement on what's going on implies nobody really knows. People have written an enormous amount on why HLF is/isn't a pyramid scheme. Yet it hasn't gone to zero yet. At the same time, it looks and smells fishy and people seem to agree the products are commodities. So how can it not be a scam? It seems to me like the logical inference is that there is something hidden below the surface and that even with all the time Ackman and others put into researching it, there's something not public sustaining it. Even if it's just a pyramid scheme, the mystery deepens, because some people who don't seem to be shills have written an unbelievable amount defending it.

by csours 6y ago

IncRnd 6y ago

Multi-level schemes are configured in order to benefit the people at the top. That is why they were created.

dmurray 6y ago

This is reassuring, if anything. Those numbers make it sound like it's mostly just a business with an unusual sales and marketing mechanism. The vast majority of the customers aren't taking part in the "pyramid scheme" part of the enterprise. They're just buying herbal supplements because they make them feel better or maybe their neighbour pressured then into it. All slightly skeezy but no worse than most retail businesses selling discretionary items. It would be much worse for society if most of the "individual sellers" were buying large quantities of the useless product, intending to sell it on but never being able to. What proportion of people in the distribution/consumption pyramid for Coke earn above minimum wage from distributing or consuming Coke? Surely a lot fewer.

deleted 6y ago
[deleted]
gruez 6y ago
>The vast majority of the customers aren't taking part in the "pyramid scheme" part of the enterprise. They're just buying herbal supplements because they make them feel better or maybe their neighbour pressured then into it. All slightly skeezy but no worse than most retail businesses selling discretionary items. That's one interpretation. The other interpretation is that herbalife has reached a saturation point where there aren't any suckers to sign up anymore, and all the "customers aren't taking part in the 'pyramid scheme'" are just the bag holders.
jjeaff 6y ago
I'm guessing all those people buying it at the bottom are doing so to meet monthly minimums. Judging by my experience trying the product, I can't imagine people really want it that bad.

gamblor956 6y ago

Herbalife's products work, but they're just vitamins, and a protein shake with vitamins. It's nothing special compared to the hundreds of competing products that exist...today. But when it was founded 4 decades ago...there weren't any products like it on the market. It basically created the market, and it's had 4 decades to expand internationally into countries where there is similarly little to no competition. It's basically the McDonalds of protein shakes. Herbalife stays in business because most of the "distributors" (in the US) are just end customers who buy in bulk at the "distributor" discount, which is why so many of them don't try to sell it on to others. And that was pretty much what the FTC concluded when they investigated Herbalife. (But note: Herbalife was determined to have operated as a pyramid scheme in several Latin American countries, and was forced to reorganize its operations in those countries.)

athms 6y ago
>But when it was founded 4 decades ago...there weren't any products like it on the market. Nonsense. There have been vitamins and protein drinks sold in stores for over 50 years. Every drug store and most grocery stores carried vitamins since the 1940s. The One-A-Day multivitamin brand appeared in 1943. My parents were born in the 1940s and they took vitamins as children. I was born in the 1960s and I took Flintstones Kids vitamins, which ere introduced in 1968. Protein powders started showing up in drug and health food stores in the 1950s with the advent of body building becoming popular. GNC was started in the 1930s and was in every major mall across America in the 1970s, and they sold protein drinks, both liquid and powder. Remember Charles Atlas? Probably not. There have been multiple health food fads throughout American history. Herbalife stays in business because people are gullible. The multi-level marketing business model appeals to our greed and fear of missing a good deal. None of the products offered by Tupperware, Avon, Mary Kay, Fuller Brush, Amway, and Primerica are unique in anyway and the only people getting rich are towards the top of the pyramid.
- perl4ever 6y ago
  I'm struck by the unwillingness of people to say they don't know what's going on. But total disagreement on what's going on implies nobody really knows. People have written an enormous amount on why HLF is/isn't a pyramid scheme. Yet it hasn't gone to zero yet. At the same time, it looks and smells fishy and people seem to agree the products are commodities. So how can it not be a scam? It seems to me like the logical inference is that there is something hidden below the surface and that even with all the time Ackman and others put into researching it, there's something not public sustaining it. Even if it's just a pyramid scheme, the mystery deepens, because some people who don't seem to be shills have written an unbelievable amount defending it.