Network Marketing Industry Problems


Forbes dot com reports that the FTC has described Vemma as....

"A Pyramid Scheme That Preys On Young Adults"

....and further reports that a court froze the company's assets and appointed a temporary receiver on 21st August 2015.

Vemma affiliates are said to urge new recruits to make an initial "investment" of $500-$600 for an Affiliate Pack and then to spend a further $150 per month on Vemma products to remain eligible for bonuses and the right to enroll new affiliates with Vemma representatives visiting college campuses in order to recruit students with promises of rewards of up to $50,000 per week.

Check out the FTC's website to read more about this.

Forbes also reports that Wall Street continues to keep a close eye on publicly traded MLM businesses such as Herbalife and NuSkin.


Well, for a few decades now, the MLM/Network Marketing Industry has been seen by a lot of people as a way out of the ordinary, to earn some extra money or to make a fortune and indeed many people have made multi million dollar/pound fortunes working with well established NM Companies worldwide.

I can think of a few names, which I'm not going to mention here but can be found by anyone who's interested enough, who have. They will no doubt evangelise that NM made them and will urge others that their only chance of doing the same is to join them in their business.

But for every single success story, there will be many thousands of others whose only experience will be of loss, frustration and maybe even anger and when you consider the example of Vemma, with their Affiliate Pack costing circa $600 and monthly autoship requirement of $150, you can understand why. Vemma is not unique in that situation with most MLM companies working on the same or similar basis.

When you consider that starting a NM business, a low level franchise or getting involved in some other direct selling opportunities has been seen as more or less the only way for Joe Bloggs to get ahead, the closing down, albeit temporarily, of an established 10 year old NM company will cause many more to consider the whole industry a scam regardless of the fact that there are some huge companies, think Avon, who operate in a similar way.

Do you think this will cause more people to think twice about starting an MLM business and if so, how are you going to capitalise on it?

If you've had some experience of the MLM industry, why not let us know who with and how it went...I had some experience with Forever Living Products about a decade ago but found the products very expensive and I couldn't get beyond that when it came to selling the products and trying to recruit others...........I lost hundreds of pounds!!

So, who did you join up with and how did it go and what are you going to do about this opportunity?

Thoughts and examples below please and, as always, thanks in advance!


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Recent Comments


I joined Vemma who was just shutdown by the government for being considered a pyramid scheme. Not too happy about it because of all the work and money I put into it!

Sorry to hear that Lou,
Apart from the time and money you invested, how does it make you feel knowing that the company you were promoting has just been effectively labelled a scam?

It makes me feel like an ass for one thing. Considering I researched it first, not necessarily stupid, but definitely duped and bushwhacked!

Bummer all round Lou.

I tried Amway but regardless of what they said,especially in Michigan the Market was saturated.Their cleaning and laundry products were very good but you had to beware of their catalog products that were imported from other sources.

I think MLM is not in itself bad. I think money grubbing companies ,no matter what system they use are bad. To be a legal MLM company there has to be a cutoff of the line, opportunity and affordability for all.


You're probably right there Marty.

Thank you for bring this to our attention even though I have not heard of Vemma it is good to be in the know, sorry you made such a loss with it , I once tried the Amway thing just was not for me it just felt that I was buying stuff to keep to the targets etc

And I think a lot of people feel the same way too Katie.

Ewww! That company sounds really unethical.

More new ones who will be looking for us and what we can offer them with WA . . . LOL!

NOT promoting here but yeah I got some experience with an MLM, and they have been in business 17 years I think. Still in it and earned a few bucks but I was not promoting anything seriously and actively till recently and still finishing getting my sites up. I know they pay out and there are not any mandatory "fees" but for doing a monthly payment of some kind, the members can earn higher commissions. With that you get "stuff" to choose from for the membership fee. We have to "mentor" anyone under us and teach them how to do it, but that is expected.

These are all over the place and each one is different with different rules; I think if the investment is more like time instead of money, especially hundreds then it is a good thing.

I think there's a place for "better" MLM companies Glo because of the low cost entry and part time work that could appeal to some people, but having to mentor new recruits may not be everyone's forte!

I had to literally work like a horse to get my commission with Herbal Life and Amway and somehow it was always the group at the top who earned the the big bucks... Shows you how desperate I was to earn some extra money for my children's education.

You're not the first and won't be the last Rich so don't beat yourself up about's just life!

I tried Amway and I tried Herbalife, and yes the products are expensive and a hard sell.

You've had a go at two of the biggest Peter and still it's hard work!!

No, this will not discourage others from starting more MLM type companies. Instead they will study intently on just what it is the feds don't like, and they will find a way to skirt the law that got the Vemma in trouble to begin with. I joined Amway back in the 80's and became apparent early on that only people with dynamic personalities were going to make it rich. It was the tapes and books that made the money. I would go to these giant meetings and conventions, and when the big dogs spoke it was almost a cult like following. They were charming and funny and could whip a crowd into a frenzy with tales of sales-how difficult it was but through perseverance and undying belief in what they were doing it all turned into the fairy tale they had always dreamed of. And you shall have your dreams come true. I didn't lose much money and there is no way I would have visited Washington DC if it hadn't been for the national get together Amway had there that year (worst place I've ever been to in the US).

I agree Broderick, there'll always be a new company who will tweak their comp plan to try and stay on the right side of the Feds whilst making a boat load for the top people and owners.

They'll get some crackpot new potion, some investment to lure big hitters from other companies who'll tell their down line they've found the new gold rush, the down line will move with the biggies who'll make an initial killing and some big royalties from their down line's auto ship and then it will all start to go belly up and here we go again!

We have tried a few over the years, most with out much success. Amway, Watkins, Life Force International, and Avon are a few. Herbal life I am aware of because of all the recent publicity.

In general, the multi-level commission structure makes the products more expensive than those of equal quality found in stores. Some are of higher quality which make them more appealing to customers. Watkins and Life Force are examples. To make a real business out of any of these requires a lot of startup cash for products, samples, sales materials,etc. otherwise it's just a hobby to make a little pocket change.

Avon was latest one Debbie was doing but we dropped it also. The product quality declined along with more fees, penalties and mandatory costs to the dealers.

So if you can find an outstanding product and it doesn't require a large amount of investment to promote it it can be a good business. Just don't be taken by the hype about the earnings you expect.

Over here in the UK, Avon has been going for ever with a more traditional like direct sales force....agents with supervisors with managers with area managers etc and I thought that if they ever went the MLM route it would be a huge bonus for the industry and a huge opportunity for distributors...they did but I don't know that it's worked out like that at all.

I've had extensive (20 years+) experience, in and out of the MLM industry. In my experience, there ARE legit companies, which offer a good service or product to the marketplace, at a price point that is competitive, and who do not burden the distributor with such excessive monthly/annual expenses to remain "eligible" that they get choked to death financially while trying to get their fledgling businesses up and profitable. I have even made some fairly decent money with a couple such MLMs.

But they are few and far between, and I would have to say, again from the voice of experience, that the vast majority of people who "follow their dream" into the world of MLM will not only never realize that dream, they will lost money, drop out, and feel like a loser. Which is damaging to the psyche and inhibits the ability to feel confident in other entrepreneurial pursuits.

I have published posts on my site about this, listing the pros and cons of MLMs and how to distinguish between a legit MLM company and the many pyramid scams posing as such. For every REAL million dollar earner in the industry, there are millions of people making less than their monthly required autoship payment, which floods up the pyramid to create those massive million dollar monthly checks for the minuscule select few at the top.

Every word a winner Marvin, well said!

I am involved with Norwex (environmentally friendly cleaning and personal care) and It Works ( naturally based skin care and supplement an a body wrap that tightens tones and firms the skin).

I think these are both legitimate companies and I have friends who are doing very well in both. The start up costs for both are minimal and you don't have to order products monthly assuming you have customers placing orders. Unfortunately I have not been very successfully with either. However I think that is partially my own fault because I don't just go out and talk to everyone like the successful people do.

I tried a course that guaranteed they would teach how to find qualified leads online but I ended up losing close to $3000 and didn't manage to get any leads.

So there is my experience. Even though I wasn't successful I would never say that all mlm's are scams. I think there are some legitimate one out there but not everyone will be successful.

Sorry to hear that you lost money Tanja, I think the vast majority of people who join MLM's do otherwise how do the people at the top make substantial incomes?

I wouldn't say I lost money with the MLM's, just on the course of bought that was supposed to help me get leads. My friends that are doing very well with these companies haven't paid for any courses (that I know of). A few are in the top ranks with the company but some aren't and are still bringing in a substantial income.

Fair play to them then Tanja, pity you've not been able to do the same from your point of view.
Never mind, you're here now so you can concentrate on building an online business for yourself.

Exactly Mark. I find I have more control over an pine business. With MLM you are always dependent on the success of others. The people that joined my team didn't really do anything which meant I wasn't making much money and it was very frustrating for me as I was trying to work hard.

I get what you're saying work hard to find and sign on your new distributors and they do nothing, so frustrating.

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