No MLM's

I recently saw a social media post pleading the case for greater mainstream acceptance of MLM's (multi-level marketing).  Its premise was that MLM stigma is an outdated mindset, and it went on to list the many reasons why it’s unkind and unsupportive to choose products from local brick-and-mortar stores rather than supporting the moms, sisters, friends or social media influencers who sell MLM products online.  The post also criticized the social media groups and in-person events that prohibit MLM marketing or participation.  Why, it asked, wouldn't you want to support someone trying to make money from home?​

I personally do not support MLM’s, and I admin a social media group of over 20,000 members which does not allow MLM marketing.  Am I/we against moms making a living?  Of course not.  Do I choose the products I buy solely to support a friend with a home-based business?  Again, of course not.  I buy the products I buy because their quality and price point work for me.  It’s not my or any customer’s job to support someone’s direct sales business, or the businesses of the unknown upline people who also earn indirect commission on these products. ​

Sure, your friend gets a commission, but so does the person who recruited her, and the one who recruited her, and so on and so on all the way up to the top of some mammoth multinational corporation based in the US.  This is not, in my book, “shopping local”.  The subject post addressed the common concern that all the real money is made at the top of the MLM pyramid by pointing out that the CEO of a company producing a product earns more than the store employee who is paid an hourly wage to sell it to you.  Hardly a comparable analogy.​

Between distributor incentive programs and countless fingers in the pie, MLM prices have to be inflated.  I get that, and I choose not to support a multitude of recruiters or a company raking in millions of dollars annually by selling overpriced products which may or may not be effective.  Don’t get me wrong, there are some great products being sold by MLM distributors, and if the product and its price point work for you, there's absolutely no reason not to support a friend's side hustle.  But.....  caveat emptor.​

MLM’s are cultish by nature and they have to be.  Being a True Believer is part of the MLM mentality, and distributors often parrot the party line without any independent research.  Having spent the past 30 years in fitness, a true health and wellness industry, I often find the products, claims and tactics of some “health and wellness” MLM’s to be concerning if not downright scary.  Health and wellness means supplements in the MLM world.  There may be thousands of similar products available on the market, but theirs is the best and the ONLY one that will work for you.  It will change your life. ​

Some of the more radical health products might very well damage your health.  None of this stuff is regulated or approved by anyone, and all carry disclaimers like this one:  “These statements have not been evaluated by the Food and Drug Administration. This product is not intended to diagnose, treat, cure, or prevent any disease.….” and this one:  “[MLM] makes no promises or guarantees regarding income. The success or failure of each [MLM] Independent Contractor, like any other business, depends on your skills and personal effort.”

I’m not saying that people can’t or shouldn’t make money at the MLM game.  They most certainly can and do if they know the ropes and have a social media following, but it’s not quite as simple as “put in the work and you’ll be rich”.  The vast majority of distributors do not make money with MLM’s.  Recent studies confirm that only 25% of potential MLM distributors turn a profit, and over half of those make less than $5,000 annually.  A similar percentage break even, and a solid 50% actually lose money, working tough hours for a pittance and failing to recover what they had to invest to join the “team” and purchase its products.  MLM’s are selling a dream, and their true strength is in marketing.  Be your own boss. Work whenever you choose.  Make your fortune while staying home with your kids.  Earn income while you sleep.  Be a leader.  Be a boss babe.

I’m currently seeing lots of hype about an MLM health and wellness product in my social media feed.  This is not a new product on the market -- it’s a supplement that’s already mainstream and has been readily available for years from many purveyors.  The product is known to be safe and effective for most people.  Similar products can be purchased in pill, powder and liquid form from your local supermarket, any natural health store or, of course, on Amazon.  Needless to say, all the health and wellness MLM's carry it too at grossly inflated prices.  A quick google search will confirm that there are many Canadian companies producing this product (approved by Health Canada) and selling it directly via store distribution or online at an average monthly cost of $50.  

I did the math.  The MLM version gives you less product at more than 3 times the price of the Health Store version, and their prescribed daily dosage is 2 to 4 times higher.  Bottom line:  A $30 investment at the Health Store will provide 2 months worth at 60 cents per dose.  The MLM product rings in at just under $100 for a 2-week supply at $6.25 per dose (if you choose the lower daily dose option).  Any informed consumer would be questioning the monthly cost of $15 at the Health Store vs. the MLM's $200 to $400 per month.      
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​Only True Believers, the very financially comfortable or dedicated friends/followers would invest this kind of money without market research and/or at least trying some of the more affordable options from a local business first.  And that, my friends, is why choosing not to support an MLM boss babe is not unkind in the least.  There's enough MLM hype out there already.  Let's not add guilt to the equation.