Welcome to our Herbalife Review!
Herbalife is one of the largest MLM companies in the nutrition and dietary supplement sector. But they have also had several legal issues in the past too. So, you might be wondering is Herbalife a scam?
There has been a lot of bad press when it comes to Herbalife, and there has been stuff that definitely set off some alarm bells about the way they were operating. But they have had to make a of of changes since the FTC have got involved. But after all those changes, has it made Herbalife a good business opportunity? Or a complete dud? Our in-depth review will get you all the answers you need.
First off, it’s great to see that you’re doing your research before buying into any “seemingly good” product.
To be completely transparent with you, we’re not associated with Herbalife in any form. We’re not here to pitch or sell you anything.
Instead, we want to ensure you get all the answers you need to make an informed decision about whether this business opportunity is the right move for you…
Herbalife Review Summary
Product Name: Herbalife
Founder: Mark Hughes, in 1980
Product Type: Health and Wellness, Skincare MLM company
Price: $94.10 or $124.10
Best For: A Great Salesperson
- Proven History
- Positive Product Reviews
- Changes for the Good
- No Monthly Sales Quota
- Expensive Products
- Herbalife Lawsuits
- Pyramid Scheme in Disguise?
- Really Low Success Rate
- Side Effects of Herbalife?
Summary: Herbalife is an MLM company that sells legit health and wellness products. Like most MLMs, their products are on the expensive side.
They also offer an opportunity for everyday people to earn commissions from selling their products and recruiting new members into their MLM model. But only those who are good at sales/recruiting find success as their income disclosure proves. Only 1 in 250 Herbalife distributors are able to make $15K a year.
The only real way of making money here is through recruitment, which makes Herbalife very similar to a pyramid scheme in disguise.
Herbalife has also had numerous lawsuits taken out against it, to the point where the FTC had to intervene and make the company change the way it operated. Bottom line, most people are losing money despite the changes introduced by the FTC.
Table of Contents
What is Herbalife?
Herbalife is one of the world’s largest Nutritional & Diet Supplement manufacturers and it also is one of the largest MLM or Multi-Layer Marketing companies offering an opportunity for you to make money by exploring either direct selling or recruiting others as a way of making money.
Herbalife was founded by Mark Hughes in 1980 as a distribution platform for his range of weight management products.
Sadly, Mark tragically died at the age of 44 from alcohol poisoning and an overdose of antidepressants. In 2000, the company dropped 43% in stock price just after his passing.
Despite this, the company has continued to grow, especially in Latino America. This has been attributed to celebrity endorsements, such as by Cristiano Ronaldo and big advertising deals, such as by LA Galaxy football club.
Herbalife has also introduced more products to its range, including protein shakes, diet snacks, and health supplements that are targeting people who are looking to lose weight..
The 2-minute video below will describe to you the MLM business opportunity they also offer…
So, that video made it sound like an exciting opportunity, right?
But you’re smart enough to know that is a clever marketing video put together…
So, you may still be wondering…
Is Herbalife a Pyramid Scheme
No, Herbalife isn’t a pyramid scheme…
They have a line of legitimate products and their distributors can earn money by just selling their products, without having to recruit anyone.
Having said that, Herbalife could be a pyramid scheme in disguise…
The reason for this is that the only way of making good money here is by recruiting a huge team under you. Let me clear all that up…
What’s a Pyramid Scheme?
A pyramid scheme is a company that promises payment in return for recruiting people into the company instead of for selling any products or services.
They have been made illegal in most countries as they are unsustainable and it is impossible for everyone to make money when recruitment is the only option.
This diagram from Wikipedia shows you why…
Now, like most legit MLMs, Herbalife does have a product line that their distributors can sell and earn a commission for doing so.
However, it is impossible to earn a decent income from these 25% commissions by selling face-to-face to friends and family.
The only way to move up the ranks and start getting to a realistic wage, is by recruiting a downline team. Most MLMs work the same way, and you end up recruiting people to earn a living…
Wait, that sounds like a pyramid scheme… Or a pyramid scheme in disguise… this 5-minute video will help you spot these so-called pyramid schemes in disguise…
Success is Rare at Herbalife
Success is rare at any MLM opportunity, and Herbalife is just the same…
Did you know that between 72.5% and 99% of all MLM members are losing money?
In the past, Herbalife have releases income disclosure statements to show you how much their distributors have earned. They seem to be well hidden these days, but we found an old copy.
We’ll show you the results later in this review… but let you tell you…
95.5% of Herbalife distributors earned less than $200 for the year!
Does that sound like the kind of income you were hoping for, from this opportunity?
How Does Herbalife Work?
Herbalife produces a rnage of health and wellness, and personal care products. We’ll get into those in a moment.
But they also offer a chance for everyday people to sell these products in return for a commission.
It sounds like a win-win situation for both their members and the company. But the bigger advantage is given to the company as they don’t have to spend millions of dollars on advertising and marketing costs.
Instead, they leave the hard job of marketing these products up to their members.
Before we get into their compensation plan, let’s explore their product line first
Herbalife Product Line
Before considering any MLM opportunity, you should really take the time to investigate their product line and even give them a try. You’re going to have to sell them, after all and knowing their benefits, and things to know is very useful.
Herbalife has a huge collection of products, and they all fall into one of the folowing categories:
- Healthy Weight
- Balanced Nutrition
- Energy & Fitness
- Specialised Nutrition
- Skin & Hair Care
We won’t be going into any great detail due to the sheer number of products that they offer. But you can take the time to check out their product line on their website.
One thing you should know is that, whilst Herbalife will claim to be unique, there are hundreds of other MLMs all offering a very similar product line…
The below 5-minute video will help you understand a little more about their product line…
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Can You Make Money with Herbalife?
The honest is yes, but it will be extremely difficult.
Those select few who are making this work will be working like full-time sales managers just to earn a little over the minimum wage. They will also have had to recruit a lot of people in doing so too, which isn’t exactly ethical in my mind.
How To Make Money with Herbalife?
Herbalife is your typical MLM, so that naturally brings the usual two ways of making money from their compensation plan:
- Sell Herbalife products to earn retail commissions
- Recruit people into your downline team and earn bonuses from their sales
Please note, you don’t actually earn money for recruiting people, that would make them a pyramid scheme. Instead, you only earn bonuses based on how well your downline team can sell.
Before we go into their compensation plan, let’s talk about how much it costs to get started…
Getting Started with Herbalife
Getting started with Herbalife will cost you either $94.10 or $124.10, depending on the package you go with…
Or, you could decide to become a preferred member for $34.95 to get a discount on the products. Then, you could always upgrade to becoming a distributor at a later time.
The business pack provides you with a range of marketing materials, a protein shake and supplement for you to try…
Now, if you’ve every checked out an MLM, you may be asking about any monthly costs you need to consider…
Herbalife Monthly Costs?
A great sign about Herbalife is that there is no monthly sales quota.
A monthly sales quota is the most common reason for MLM members to lose money, as they constantly have to keep on buying products to remain active.However, if you are serious about promoting Herbalife products then you are probably going to need to use them yourself. People can see right through those “sales reps” who just preach their products but you never actually see them using the stuff themselves.
And you can even see what Healthline suggests about the price…
If you are going to give this opportunity a go, then you need to be serious about it and become a consumer yourself.
That means you’re probably looking at spending at least $80 a month on these shakes. whilst this isn’t necessary, if you don’t like the products yourself how are you going to convince others to use them?
P.S. This program enabled us to Create a 4-Figure Monthly Passive Income Stream. It’s Free to get started and costs only $49/month to go full-time!
Herbalife Compensation Plan
Since Herbalife were sued for $200 million dollars by the FTC in 2016, they have had to make some drastic changes to the way they are operating…
There aren’t any specific details about an official compensation plan, as of yet. But you can watch several YouTube videos that show what you need to know…
Basically, there are 4 main ways you can make money from their compensation plan…
1. Retail commission (25-50%)
2. Build a team (earn wholesale profit bonuses from your downline sales)
3. Royalties (5% bonuses from your downline sales)
4. Bonuses (around a $400 bonus for recruiting & promoting 10 people to supervisor level)
MLMs love to make their compensation plans to sound complicated. It make sit look like there are tons of ways to make money, when the reality is there is only 2 ways to make money:
- Sell Herbalife Products
- Recruit people into your downline
If you want to get your head around their compensation plan, here is an 11-minute video which should help you out.
Or you can check out their compensation plan here…
Is Herbalife a Scam?
No, Herbalife isn’t a scam. They sell a legit product line and they also pay their members on time like they say they do.
Some people claim all MLMs are pyramid schemes as most do put a huge emphasis on recruitment. But it is technically possible for you to sell their products and earn an income, without the need to recruit.
But it would require you to be selling a lot of these products to make this a viable option. But there will be a select few who could make this possible.
The remainder of our Herbalife review will ensure you get all of the other details you need to know about this business opportunity, so that you can then make an informed decision about whether it is right for you…
Just to be completely transparent with you, I’m not a distributor of Herbalife, nor do I endorse Herbalife in any way. I have researched the website, testimonials, and information available on the internet to get the details about what this program genuinely does. I do this, as I have been caught out by a scam in the past, and am trying to help others avoid a similar fate…
Tired of MLMs? Check How We Make Money Online Here!
If you do a search online around Herbalife and the MLM opportunity, you will see a lot of complaints… but they are all around the distributors and not necessarily about Herbalife.
As they are desperate to recruit more downlines under them, they are resorting to practices that are legit and could be classed as fraud. One example I read was a distributor posting a job ad. Any job seek would then be shown a very flowery Herbalife sales pitch which they might fall for.
Other examples were distributors inviting people to a “free breakfast” at Herbalife Nutrition Clubs and then they find themselves in a sales pitch for signing up.
Done right, MLM can be a viable business model. But it can be extremely hard, and these dodgy distributors do more harm against people’s perception of MLM and these direct selling opportunities.
But Herbalife could do more to help this by giving more help, guidance and coaching for its distributors around good and acceptable recruitment techniques.
If they taught people about lead generation online and how to recruit the right people who are informed, they will probably have a better chance of actually making money without having to resort to these types of methods.
I also found references to a “Pershing Square” documentary on Herbalife Distributors which was an interesting watch and I suggest you go and watch it if you are still considering Herbalife as an option.
The FTC & Herbalife
If you are doing your research in Herbalife, then you will have probably come across some information around the FTC ordering Herbalife to pay for an Independent Compliance Auditor (ICA) to monitor the corporation over the next few years.
In 2016, The FTC filed a class action lawsuit against Herbalife. These events were as a result of suspected manipulation and trickery used on vulnerable working class and low-income investors. This resulted in the FTC taking full control of the company for a total of 10 days.
This has resulted in Herbalife changing the way its compensation plan was structured to put more of an emphasis on actually selling their products and not only focusing on recruiting new distributors to make money.
This is because, without the products being sold it would mean people are only recruiting new members and that is what gets these MLM schemes appearing like Pyramid Schemes. AS pyramid schemes are illegal, is a good thing that they changed their model.
In fact, as a result of how Herbalife was running itself prior to that independent review, The FTC has sent 350,000 checks to the majority of victims who invested in the MLM venture under Herbalife between 2009-2015.
So, whilst this might seem like a lot of negatives, it has led to Herbalife running its business much better and they must be much more transparent and upfront about the realistic earning potential. Herbalife were boasting to you about how you could have a lavish lifestyle following their model, but as it isn’t exactly true they are do not put it across like this anymore.
What We Liked About Herbalife
Here’s what we liked about Herbalife:
#1 Proven History
Something to think about… 50% of MLMs don’t get past the 5 year mark and 1 in 3 don’t get past the ten year mark. So, or Herbalife to still be around after 40 years does put it in a select few, like Amway & Mary Kay.
This shows that Herbalife isn’t a scam and that it isn’t going to disappear overnight either.
#2 Positive Product Reviews
There are also people who find their products to be good and have left positive products reviews on their consumer affairs profile.
#3 Celebrity Endorsements
They will also be those that have heard of Herbalife due to the celebrity connection. Herbalife has put a lot of effort into getting themselves sponsorships and celebrity endorsements.
Yes, Cristiano Ronaldo is an endorser of Herablife…
But there is also the negative side to the name though, as many people have heard the negative stuff about the company too.
Just check out the popular documentary “Betting on Zero”, if you haven’t heard of it. Check out the 2-minute trailer below…
#4 No Monthly Sales Quota
A good and clear sign that they are not a scam or a pyramid scheme is that they don’t task their members with a monthly sales quota. This is usually the main reason why so many MLM members are losing money, as they are constantly buying product each month to remain active.
It also shows that they have more interest in you selling products, over recruiting people.
Maybe it was the FTC lawsuit, but they have put a lot of effort into making sure they don’t appear like a pyramid scheme …
What We Didn't Like About Herbalife
Here’s what we didn’t like about Herbalife:
#1 Expensive Products
Herbalife products, like most MLM products are ridiculously expensive. It could be a sign that they are operating like a pyramid scheme in disguise, as who is going to pay those prices.
Herbalife’s protein shakes are 300% more expensive that other highly rated protein shakes found online.
What is more alarming is that Herbalife products are not better, in fact they are a lower quality. There is less protein, more sugar and additives in Herbalife’s protein shake.
And even less processed shakes are far better for you in the long run.
The expensive products means that many of the distributors will encourage people to join Herbalife with the potential to make some “pocket money” from it. This is far more attractive to people than offering them overpriced protein shakes that they don’t want.
But that is also a sign that Herbalife promotes recruitment aka a pyramid scheme in disguise!
#2 FTC Lawsuit – Sued Herbalife for $200 Million
You can check out the FTC lawsuit here…
It is becoming more common for MLM companies to be sued for being a “pyramid scheme in disguise” or for falsely advertising their income potential.
But due to these misleading claims and how they operating, they have had to make drastic and real changes to the way they now operate. To me that shows that Herbalife have always operated like a pyramid scheme in disguise…
#3 Is Herbalife Still a Pyramid Scheme in Disguise?
It does appear like Herbalife has made some positive changes to make it appear like they are not a pyramid scheme. But there are still some signs that they could still be one in disguise…
I mean 3 out of the 4 ways you can earn money from their compensation plan is based on recruitment, so there is a focus on recruitment here.
#4 Really Low Success Rate
Herbalife’s global statistics show that for the year 2016/2017, for the United States, 86% of their distributors did not receive any commissions or income promoting Herbalife Nutrition. That number is 466,926!! That is a staggering figure
That is when the FTC received a $200 million-dollar settlement fee which they used to reimburse these distributors that were misled into the MLM scheme with Herbalife. 350,000 consumers received refunds between $100-$9,000 depending on the nature of their investments. Please note, these were not completed refunds but partial refunds, so you have to question how much people had invested…
The statistics show that between July 2017 & June 2018, there were now only about 51,500 distributors left in the US and 5,000 of these didn’t make a sale.
The numbers look good at this point, it means that about 46,500 made at least one sale.
23,000 of both new and lifetime members earned themselves at least $140 and the Top 10% earned at least $840. The top 1% earned at least $2,800.
It still doesn’t seem a lot of money, even if you were in the top 1% and it would be extremely difficult for anyone to actually claw their way up to that point.
Success will be dependent on how well you can sell or entice your friends and family to sign up to buying products, but this can really harm those relationships and personally why I feel that MLM opportunities or direct selling opportunities require a certain personality. I am not saying you cannot find success with an MLM, but you need to be a great salesman.
#5 Side Effects of Herbalife?
There are also some reports of side effects from using their products, which is never a good sign…
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My Herbalife Review - Final Conclusion
I don’t want you to think I totally against MLM opportunities or Herbalife, however when you start digging into Herbalife, I am not sure there have been enough changes to make this worthwhile. There is a huge stigma about Herbalife Distributors meaning you are going to have to overcome these to be successful at selling these products. I think you will also have a hard time convincing people to become a distributor under you, as they will be hit with the same stigma.
If you are outgoing and are pretty good at sales, you might make this work. But for the majority of us, this is not the case and that is why I believe Direct Selling Opportunities like this, might sound good on paper but the amount of hard work that you would need to put in doesn’t always equal the success you want.
The Income disclaimer just shows how little people are earning, and how much are you going to need to spend to be able to advertise these products to a larger audience or to learn how to do all these things because there is no real training on how to promote this business model to others for you to get to that top 1%.
MLM works for the people at the top of the pyramid, it is highly unlikely for us normal people to climb up to become one of them and that is why it is a business model that you need to be really careful about deciding to go into it.
Selling the products does require you to buy them first and you will need to consider where you are going to store them, and how you are going to be able to sell them. If you are thinking of doing that online, you need to consider what other people are charging and whether you will actually make any profit or not. Is there a shelf life on the products and hence how long have you got to make a sale?
That is why we recommend Affiliate Marketing as a much better business model and tell complete newbies to avoid MLM or direct sales.
How We Make Money Online
I’m not a fan of MLM, not because it’s illegal or not profitable, but because of all the restrictions and expensive costs involved.
Instead, Affiliate Marketing is our top recommended business model for anyone looking to make money online
The reasons are simple…
- You can promote anything you want and aren’t restricted to only promote products from one MLM company
- You don’t have to recruit anyone to make money
- You never need to sell to your friends and family
- It’s free to get started
In fact, with affiliate marketing we’ve been able to Create a 4-Figure Monthly Passive Income Stream. If you want to learn more, click here.
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Thanks for checking out our Herbalife Review! If you have any questions or comments to add, then please write them in the comments section below. 😉
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