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(Forbes)   THIS is how you take down a pyramid scheme   (forbes.com ) divider line
    More: Hero, pyramid schemes  
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10610 clicks; posted to Business » on 21 Dec 2012 at 12:03 AM (3 years ago)   |   Favorite    |   share:  Share on Twitter share via Email Share on Facebook   more»



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2012-12-21 12:08:59 AM  
Herbalife has lasted long enough. What is making them fail soon?

The world ain't making enough new suckers?
 
2012-12-21 12:14:31 AM  
Shares of Herbalife, which slumped Wednesday when news of Pershing's short position broke, dropped another 9.8% Thursday and is off more than 23% for the week

Congrats, you've managed to make me unable to ID who the real bad guy is. It's like the reverse of a pump-and-dump, but the company in question is scum.

/The best money in an MLM is at the top.
//Start one today.
 
2012-12-21 12:14:51 AM  
If you managed to live to adulthood and don't know Herbalife is a pyramid scheme, then may god have mercy on your soul, and hey, good luck with that!
 
2012-12-21 12:26:07 AM  
My Amway pitchman said it's NOT a pyramid scheme!

/I think of it more as economic Scientology.
 
2012-12-21 12:49:58 AM  

wildcardjack: Shares of Herbalife, which slumped Wednesday when news of Pershing's short position broke, dropped another 9.8% Thursday and is off more than 23% for the week

Congrats, you've managed to make me unable to ID who the real bad guy is. It's like the reverse of a pump-and-dump, but the company in question is scum.

/The best money in an MLM is at the top.
//Start one today.


It's called "short and distort." You intentionally undervalue the stock, so you can buy it up when the price drops.
 
2012-12-21 12:51:51 AM  
www.rockwallgop.com
 
2012-12-21 01:01:54 AM  
cdn.pastemagazine.com
 
2012-12-21 01:34:55 AM  
What about Amway and Shacklee?
 
2012-12-21 02:07:18 AM  
I did an MLM once. Surprisingly it was one of the better things I did, but for the completely wrong reasons you'd imagine and now I'm not really that well liked at the MLM.

Let me explain...

A couple of years ago I got into Primerica. Not seeking to make the big money there, but just some extra income. I got my life license and learned all about finance and insurance stuff, knew everything about Buy Term and Invest the Difference, including why it's not always the best direction to go (as in, it's rare that it's ever a good idea. Great on paper, poor in reality), and also about investments. The leader of my office (called an RVP: Regional Vice President) hated the fact that I was learning more about the money side of the business (investments, insurance, etc...) and not so much about the recruiting side of things. I got really good at reciting the party line about how you must recruit and if you're friends won't do business with you then they aren't your friends and could even call up someone to recruit them and point out the flaws in being an employee while at the same time questioning a few things about Primerica (for example, they say that at Primerica we have freedom, that we aren't held to a schedule because we are adults, then why am I expected to work six to seven days a week, 7 am until midnight if needed and make every team, office and company event? Evidently the company and I had different definitions of the word 'freedom'). In a 12 month period I spent $100 for convention tickets, plus $100 to get to and from the convention plus $70 for the hotel room (12 of us crammed into a small room) plus food. Then there was a fast start school (local convention) tickets were $20/each and since I was a key leader I was expected to buy no less than five (told "When you recruit and you take the $100 for their application, go ahead and require them to buy a ticket. If they have $100 then they also have $120".), then after the first of the year there was a fast start school in Colorado. Another additional $20/ticket buying no less than 5 tickets and telling the people I recruited in December/January that if they are serious about this company, about building their business they'll buy the ticket and find someway to pay their way to Colorado (I got my ass chewed for telling them "Don't worry about going".) plus gas money out there, plus hotel room, plus food, and questioned as to why I didn't buy additional materials that were being sold by some of the higher ups. And another local fast start school where I again had to buy $100 in tickets. We were told that each event was an investment. I argued that I would be better off staying home and building my business instead of spending hundreds of dollars to listen to a bunch of dull speeches, many of which I had heard before since the same seven people attended all the events.

And how much time was involved in this? Well, for Colorado, the pitch started three months before to get us excited for it (or looking for excuses not to go. "I have to work." wasn't a good enough excuse as the RVP firmly believed that even if you were making $1,000/day you could still take time away from your job to attend a convention to hear speeches. My excuse of "I have a doctor's not saying I'm not fit to travel." following a car wreck where I broke nine bones was replied back with "If you knew how important this was, you'd find a way to go"). The week of the trip was business as usual. The day of the trip, a Thursday, we had our typical Thursday event (manager's meeting from 5-7 which was telling us we weren't doing good enough, berating us for losing team members and other things that made not want to be there week after week, but missing those meetings I found was worse, over view meeting: for new potential recruits. I was expected to be there each week even though I knew what was said each and every bloody time. Time spent going over my grocery list in my head, 7 to 8. Recognition from 8 to whenever. Promotions, awards, who brought the most new people. It was explained as it lasts until when ever since Primerica paid for the rent on that room there was no end point, especially since end points are for corporate time clock job people. After that was the office dinner. Yes, dinner on Thursdays wasn't until almost 10 pm, and to make it worse, there were people who were happy to explain that being physically hungry doesn't matter, the most important thing to be doing is to be at that meeting). After dinner we got into the vans and drove out to Colorado. Being in the van with the RVP who viewed 5 hours of sleep as too much, the trip was a dull ride with the RVP wanting to know who fell asleep first because that was the person who was most likely to fail in the company (those who are winners were too excited to sleep). It's really a good thing that she didn't know that my iPod was playing music and Star Trek, Star Wars and Doctor Who audio books in addition to podcasts and not the motivational speeches from Primerica higher up and self help books (yeah, one of the RVP's biggest complaints were those who listened to music in their cars and not speeches and self help books). So, after almost no sleep in the vans, made it to the first event of that weekend. More dull speeches and fighting to stay awake. Dinner, then to one of the higher up's home for a party. We were there for three hours. Partied for 30 minutes, question and answers for 2 and a half hours eating and drinking during this time was not allowed. Another night in a cramped hotel room. The next day was pretty much the main event and boredom. Hotel room, ordered pizza, another Primerica party that started off with more speeches (not much different than the ones heard earlier that day and the day before, and the RVP's speech that she recites over and over and over again). Hotel room around 2 am, in the vans by 6 am, home around 9pm Sunday night. Expected back at the office bright and early Monday morning. I figured "fark it, I'll just stay until noon and head home, get some sleep, catch up on the shows I missed and spend time with the wife of mine." That's when I learned of the Maniac Monday event planned for 5 that evening and that it was mandatory. So I didn't get home until 10 pm (we also had a conference call following the event and I had talking on the phone while driving) and when I did, it was to a wife who was more than happy to biatch about my absence and the expense of that weekend and how much I'm going to have to sell just to earn back what I spent.

And that's two of the reasons why I left. It was spending more time there than I was anywhere else and if they knew that I wasn't at home their first question was "Where you on a sales call?" and when I would answer "No, I was at a friend's place." I would hear the speech about how silly I am to waste my time with a friend who isn't in Primerica because he's not doing anything with his life (because the only thing worth doing with you life is being in Primerica apparently, and those who aren't are not worth your time unless they are buying insurance from you). And the other reason was the costs associated. When things are good the money is great. When things are going badly, being expected to spend $500 on a trip to Georgia or Colorado is painful. I heard stories of some Primerica people who were living in their RVP's home and sleeping on their couch to keep expenses down (and cult like pressure to not drop out of the company). My RVP said that until you reach the levels beyond RVP, having anything like a television or a gameboy is just holding you back. I got tired of having the RVP and those who were lined up to go RVP next look at my life, my home and my hobbies and tell me what as waste they were. Some of the women there, the single ones, were only dating other Primerica people and if their boyfriend's dropped out of the company, they dumped them. The woman who recruited me got an ear full for not getting her baby daddy recruited into the company.

So I left. I got to the point where I was constantly stressed out, offended in a few ways (how often can you hear that if you are reading anything but a self help book you are wasting your time and that your hobbies are a waste because they do not make you a better person, before you're ready to physically harm someone?) and the wife of mine was ready to leave me because I was putting 90 a week at Primerica, not counting after hour events.

I put my resume out there, included my time at Primerica and that I had a current life insurance license. Those at Primerica who found it were all to happy to call me up and ask why I as gone. I should return those calls...maybe. I got calls from other companies that needed recruiters and explained to me that if I could recruit for Primerica than I could recruit for just about any company. I got calls from other insurance companies and joined one that doesn't require or expect me to do any recruiting, they supply me with leads of people who have expressed interest in life and health insurance and I'm only expected to work 3 and a half days, earning $1,200 or more a week, and the company works with several different life and health insurance companies, much better than the Primerica approach which is to recruit someone, make them pay money, make them give you a list of people who they know you sell to them, you get 100% of the commissions and they get "trained" and no money and upon getting licensed they have earned no money and their trainer has successfully depleted their entire warm market. Now I sell insurance (what Primerica taught me) and I know what to say to my clients so that in the event a Primerica agent approaches them they know what to say in response get the Primerica agent to run away screaming (Primerica isn't really the absolute best product, losing clients means me losing residuals, and Primerica agents don't just want to sell to a client, but also recruit them and are told that if they don't they've failed, I tell my clients that so they know what to expect if they have a family member or friend approach them from Primerica. But I also don't pick on Primerica agents. I tell clients to google the ten worst life insurance companies. That pretty much kills my competition).

Like I said, my time in an MLM did actually improve my professional life, but not in the way everyone expected, but in a way that makes me very disliked by my former MLM.
 
2012-12-21 04:28:14 AM  

Great Janitor: I did an MLM once. Surprisingly it was one of the better things I did, but for the completely wrong reasons you'd imagine and now I'm not really that well liked at the MLM.

Let me explain...

A couple of years ago I got into Primerica. Not seeking to make the big money there, but just some extra income. I got my life license and learned all about finance and insurance stuff, knew everything about Buy Term and Invest the Difference, including why it's not always the best direction to go (as in, it's rare that it's ever a good idea. Great on paper, poor in reality), and also about investments. The leader of my office (called an RVP: Regional Vice President) hated the fact that I was learning more about the money side of the business (investments, insurance, etc...) and not so much about the recruiting side of things. I got really good at reciting the party line about how you must recruit and if you're friends won't do business with you then they aren't your friends and could even call up someone to recruit them and point out the flaws in being an employee while at the same time questioning a few things about Primerica (for example, they say that at Primerica we have freedom, that we aren't held to a schedule because we are adults, then why am I expected to work six to seven days a week, 7 am until midnight if needed and make every team, office and company event? Evidently the company and I had different definitions of the word 'freedom'). In a 12 month period I spent $100 for convention tickets, plus $100 to get to and from the convention plus $70 for the hotel room (12 of us crammed into a small room) plus food. Then there was a fast start school (local convention) tickets were $20/each and since I was a key leader I was expected to buy no less than five (told "When you recruit and you take the $100 for their application, go ahead and require them to buy a ticket. If they have $100 then they also have $120".), then after the first of the year there was a f ...


Christ your experience with Priamerica exhibits all of the classic signs of cult indoctrination. You have sleep deprivation and nutritional deprivation to weaken your judgement while they repeatedly preach their repetitious mantra. And from what you described they even use insults and embarrassment to make people fall in line with their way of thinking and to drive them away from anybody that isn't a part of the "company".

I remember around 6 or 8 years ago I started getting cold calls and emails from Priamerica recruiters out of the blue. It always confused me as to why they would constantly call me and try to recruit me considering that I never worked in insurance or for an insurance company and their isn't anything on my resume that would even suggest that I had any experience in sales. So I always ignored the emails and told the people that called me that I was interested, figuring it was some type of scam. From the experience that you described, I'm glad I did.
 
2012-12-21 04:30:42 AM  

ongbok: Christ your experience with Priamerica exhibits all of the classic signs of cult indoctrination. You have sleep deprivation and nutritional deprivation to weaken your judgement while they repeatedly preach their repetitious mantra. And from what you described they even use insults and embarrassment to make people fall in line with their way of thinking and to drive them away from anybody that isn't a part of the "company".


Correct. Kirby does the same thing.
 
2012-12-21 05:48:38 AM  

wildcardjack: Shares of Herbalife, which slumped Wednesday when news of Pershing's short position broke, dropped another 9.8% Thursday and is off more than 23% for the week

Congrats, you've managed to make me unable to ID who the real bad guy is. It's like the reverse of a pump-and-dump, but the company in question is scum.

/The best money in an MLM is at the top.
//Start one today.


Except they're releasing all their research data. All Herbalife has to do is prove them wrong and they take a huge hit in the credibility department.
 
2012-12-21 06:48:38 AM  
So I should move my money into ExtenZe
 
2012-12-21 07:17:52 AM  

Dr.Mxyzptlk.: So I should move my money into ExtenZe


Don't be an idiot. The smart money is in Beezid.com.
 
2012-12-21 07:27:07 AM  

Land Ark: Dr.Mxyzptlk.: So I should move my money into ExtenZe

Don't be an idiot. The smart money is in Beezid.com.


No scentsy. Become a consultant today.
 
2012-12-21 07:33:44 AM  
Based on stories like this and a very small sample size of one friend, I've concluded that hedge fund folks are essentially well-compensated trolls with a lot of professional cynicism and a love for schadenfreude.
 
2012-12-21 07:36:37 AM  

netringer: Herbalife has lasted long enough. What is making them fail soon?

The world ain't making enough new suckers?


Basically, yes. They had to go international, looking for suckers. They've gone through the suckers in the middle-to-higher income countries (Israel, Mexico) and are seriously trying to chase the last Peruvian highlander and Kalahari bushman who hasn't had the "business opportunity of a lifetime".
 
2012-12-21 08:12:08 AM  

Dr.Mxyzptlk.: So I should move my money into ExtenZe


My broker says they're showing massive growth.
 
2012-12-21 08:21:39 AM  

Lawnchair: netringer: Herbalife has lasted long enough. What is making them fail soon?

The world ain't making enough new suckers?

Basically, yes. They had to go international, looking for suckers. They've gone through the suckers in the middle-to-higher income countries (Israel, Mexico) and are seriously trying to chase the last Peruvian highlander and Kalahari bushman who hasn't had the "business opportunity of a lifetime".


From what I hear, Amway is big in China now.
 
2012-12-21 08:39:00 AM  

ongbok: From what I hear, Amway is big in China now.


Amway, while scuzzy, has at least somewhat more unique products than Herbalife. They aren't quite as dependent on the "recruit people to recruit people for your downline" side of the game. The latter is illegal in China now, although Amway, Avon, etc are big under a slightly altered structure. (In the late 90s, the classic pyramid MLMs went absolutely nuts in China... a billion naive customers and a culture of familial obligation? It seriously lead to riots.)
 
2012-12-21 08:41:59 AM  

ongbok: Lawnchair: netringer: Herbalife has lasted long enough. What is making them fail soon?

The world ain't making enough new suckers?

Basically, yes. They had to go international, looking for suckers. They've gone through the suckers in the middle-to-higher income countries (Israel, Mexico) and are seriously trying to chase the last Peruvian highlander and Kalahari bushman who hasn't had the "business opportunity of a lifetime".

From what I hear, Amway is big in China now.


Hell, they're still big in the US. They just keep rebranding themselves. An old roommate almost bought into Quixstar (now Amway-Global) because a church friend of his was heavy into it with his young wife. I told him if he wanted to be stupid and start throwing money into a black hole that I'd be taking his name off the lease and kicking him out.
 
2012-12-21 08:50:57 AM  

MightyPez: ongbok: Lawnchair: netringer: Herbalife has lasted long enough. What is making them fail soon?

The world ain't making enough new suckers?

Basically, yes. They had to go international, looking for suckers. They've gone through the suckers in the middle-to-higher income countries (Israel, Mexico) and are seriously trying to chase the last Peruvian highlander and Kalahari bushman who hasn't had the "business opportunity of a lifetime".

From what I hear, Amway is big in China now.

Hell, they're still big in the US. They just keep rebranding themselves. An old roommate almost bought into Quixstar (now Amway-Global) because a church friend of his was heavy into it with his young wife. I told him if he wanted to be stupid and start throwing money into a black hole that I'd be taking his name off the lease and kicking him out.


I remember one of my friends was pushing that Quickstar to all of us, and was putting a lot of his time and energy into trying to start up a group and recruit people to start groups. Now this guy wasn't stupid, had a degree in TV and Film production and had a pretty decent production job at a pretty big TV station. He ended up getting fired from his job for neglecting his duties in favor of Quickstar. We would always tell him if he would put half of the energy into film production, he would probably make far more than he ever would in Quickstar.
 
2012-12-21 09:11:04 AM  

ongbok: I remember one of my friends was pushing that Quickstar to all of us, and was putting a lot of his time and energy into trying to start up a group and recruit people to start groups. Now this guy wasn't stupid, had a degree in TV and Film production and had a pretty decent production job at a pretty big TV station. He ended up getting fired from his job for neglecting his duties in favor of Quickstar. We would always tell him if he would put half of the energy into film production, he would probably make far more than he ever would in Quickstar.


This sort of thing reminds me of a comedian (I forget who now) joking about Taebo when those videos were playing on infomercials. Paraphrased: "My friends will tell me, 'I did Taebo, and it toally works!' OF COURSE IT WORKS! You're jumping up and down, you're moving, you are exercising!"

So yeah, if you put a ton of effort and hustle into Amway or Quixstar you may make a lot of money. The same thin will happen with just about every other job, too.
 
2012-12-21 09:13:43 AM  

ongbok: MightyPez: ongbok: Lawnchair: netringer: Herbalife has lasted long enough. What is making them fail soon?

The world ain't making enough new suckers?

Basically, yes. They had to go international, looking for suckers. They've gone through the suckers in the middle-to-higher income countries (Israel, Mexico) and are seriously trying to chase the last Peruvian highlander and Kalahari bushman who hasn't had the "business opportunity of a lifetime".

From what I hear, Amway is big in China now.

Hell, they're still big in the US. They just keep rebranding themselves. An old roommate almost bought into Quixstar (now Amway-Global) because a church friend of his was heavy into it with his young wife. I told him if he wanted to be stupid and start throwing money into a black hole that I'd be taking his name off the lease and kicking him out.

I remember one of my friends was pushing that Quickstar to all of us, and was putting a lot of his time and energy into trying to start up a group and recruit people to start groups. Now this guy wasn't stupid, had a degree in TV and Film production and had a pretty decent production job at a pretty big TV station. He ended up getting fired from his job for neglecting his duties in favor of Quickstar. We would always tell him if he would put half of the energy into film production, he would probably make far more than he ever would in Quickstar.


A friends family almost got into quickstar. As a final "vote" on if they would do it they asked if i could come and sit through the "pitch" with them to see if it was all on the up and up. After sitting through the 1 hour presentation I had but one important question.

"forget everything about it being a pyramid scheme. If your recruited customers never return to the website under your name, you will never make any money?... Thats correct"

And thus i saved my friends family from disaster. At the time when we were presented the customers you recruited were required to "refer" your name on each and every order they placed on their website. If they did not it would default to the regional VP. That was enough to make me laugh and scare off the family. Along with if the customers turned into recruiters as well they would be disconnected from you.
 
2012-12-21 09:16:25 AM  
I had Hannity on the radio recently for some reason and in the commercials they advertised a site with a name similar to incomefromhome.com (not real URL) and it sounded scammy - e.g. "I make $7,000/month without leaving my kitchen". So I went to the site and at the very bottom it said that it's affiliated with Herbalife. So you take your 300 slide presentation proving it's a scam but I only need two things:

1. They advertised on Hannity
2. They don't even send you to their site but to some even scammier site
 
2012-12-21 09:20:37 AM  

MightyPez: ongbok: I remember one of my friends was pushing that Quickstar to all of us, and was putting a lot of his time and energy into trying to start up a group and recruit people to start groups. Now this guy wasn't stupid, had a degree in TV and Film production and had a pretty decent production job at a pretty big TV station. He ended up getting fired from his job for neglecting his duties in favor of Quickstar. We would always tell him if he would put half of the energy into film production, he would probably make far more than he ever would in Quickstar.

This sort of thing reminds me of a comedian (I forget who now) joking about Taebo when those videos were playing on infomercials. Paraphrased: "My friends will tell me, 'I did Taebo, and it toally works!' OF COURSE IT WORKS! You're jumping up and down, you're moving, you are exercising!"

So yeah, if you put a ton of effort and hustle into Amway or Quixstar you may make a lot of money. The same thin will happen with just about every other job, too.


Yeah but I think you would have a much better chance at making money putting the effort into a job or a business providing your skills than you would with Amway.
 
2012-12-21 09:30:09 AM  
Yes, Herbalife is a scam and everyone with a working brain should know that. Many businesses are essentially scams at heart, but as long as the scam is producing money then someone is benefiting. I'm honestly surprised that Herbalife is publicly traded because secrecy is their best and only asset.

Since it is publicly traded, my assumption is that everyone who owns their stock knows that they are buying a scam business stock, but one that they hope to make money on.

This douchebag Pershing is attempting to achieve exactly what is NOT supposed to happen in a properly functioning stock market, which is to influence the valuation of a company's shares simply by saying things, and with the clear intention of lowering stock prices in order to benefit by a short-sale bet he made against the company.

While I despise Herbalife, I despise Pershing and what he's trying to do even more.
 
2012-12-21 09:43:29 AM  

Land Ark: Dr.Mxyzptlk.: So I should move my money into ExtenZe

Don't be an idiot. The smart money is in Beezid.com.


All my money is in Zombo.com.
 
2012-12-21 09:46:15 AM  
So some fast money fartknocker on wallstreet shorts a company and then holds a press conference knocking the company's business model and he gets a hero tag because of it?

That isn't a hero tag subby.
That's called a short and distort, it's fraud and the guy will likely be getting a visit from the SEC to collect their 15% cut of the profit.
 
2012-12-21 10:34:38 AM  
as long as it shuts down the damned herbalife warehouse near my office
 
2012-12-21 10:51:43 AM  

Ishidan: ongbok: Christ your experience with Priamerica exhibits all of the classic signs of cult indoctrination. You have sleep deprivation and nutritional deprivation to weaken your judgement while they repeatedly preach their repetitious mantra. And from what you described they even use insults and embarrassment to make people fall in line with their way of thinking and to drive them away from anybody that isn't a part of the "company".

Correct. Kirby does the same thing.


LOL.  At the depth of my midwest mid 80s economic and personal depression, at my psycho first wife's suggestion, I went to attempt to sell Kirby vaccuum cleaners.

Worst two weeks of my life.

I just simply do not have the "deliberately lie to people" gene.  Am somewhat in awe of, but also disgusted by, those that do.
 
2012-12-21 10:54:40 AM  

rosemary's baby daddy: I had Hannity on the radio recently for some reason and in the commercials they advertised a site with a name similar to incomefromhome.com (not real URL) and it sounded scammy - e.g. "I make $7,000/month without leaving my kitchen". So I went to the site and at the very bottom it said that it's affiliated with Herbalife. So you take your 300 slide presentation proving it's a scam but I only need two things:

1. They advertised on Hannity
2. They don't even send you to their site but to some even scammier site


Boortz plugged them too. I assume there was a referral fee.
 
2012-12-21 11:41:42 AM  

Lawnchair: ongbok: From what I hear, Amway is big in China now.

Amway, while scuzzy, has at least somewhat more unique products than Herbalife. They aren't quite as dependent on the "recruit people to recruit people for your downline" side of the game. The latter is illegal in China now, although Amway, Avon, etc are big under a slightly altered structure. (In the late 90s, the classic pyramid MLMs went absolutely nuts in China... a billion naive customers and a culture of familial obligation? It seriously lead to riots.)


My parents did Amway stuff for a few years back in the 90s. There was another side of the business that was all "recruit, recruit, recruit" (buy expensive "motivational" tapes, etc.) that seemed very shady. The part of the business of selling Amway products wasn't bad, however. There are many Amway products that are consistently rated near the top of their product categories by reputable review organizations (e.g., Consumer Reports), but they do tend to be expensive. Amway gets a lot of attention (probably less now than a couple of decades ago), but a lot of their products are pretty high quality. Just stay away from he "recruit, recruit, recruit" side of that business...
 
2012-12-21 12:05:59 PM  

ongbok: Yeah but I think you would have a much better chance at making money putting the effort into a job or a business providing your skills than you would with Amway.


I'm certainly not disagreeing. I was more poking fun at the mindset of people that say their get rich quick scheme works because they made a few bucks from working their asses off.
 
2012-12-21 12:10:32 PM  

WxGuy1: Lawnchair: ongbok: From what I hear, Amway is big in China now.

Amway, while scuzzy, has at least somewhat more unique products than Herbalife. They aren't quite as dependent on the "recruit people to recruit people for your downline" side of the game. The latter is illegal in China now, although Amway, Avon, etc are big under a slightly altered structure. (In the late 90s, the classic pyramid MLMs went absolutely nuts in China... a billion naive customers and a culture of familial obligation? It seriously lead to riots.)

My parents did Amway stuff for a few years back in the 90s. There was another side of the business that was all "recruit, recruit, recruit" (buy expensive "motivational" tapes, etc.) that seemed very shady. The part of the business of selling Amway products wasn't bad, however. There are many Amway products that are consistently rated near the top of their product categories by reputable review organizations (e.g., Consumer Reports), but they do tend to be expensive. Amway gets a lot of attention (probably less now than a couple of decades ago), but a lot of their products are pretty high quality. Just stay away from he "recruit, recruit, recruit" side of that business...


This guy was a Diamond and wrote an entire book book about his experiences with Amway. All the money made is from sales of books, tapes, and conventions:
Master's of Deception
 
2012-12-21 12:10:40 PM  
Everything you need to know about Herbalife and other MLMs: 99.xx% of participants lose money.
Skeptoid.com on MLM
 
2012-12-21 12:31:53 PM  

ongbok: Great Janitor: I did an MLM once. Surprisingly it was one of the better things I did, but for the completely wrong reasons you'd imagine and now I'm not really that well liked at the MLM.

Let me explain...

A couple of years ago I got into Primerica. Not seeking to make the big money there, but just some extra income. I got my life license and learned all about finance and insurance stuff, knew everything about Buy Term and Invest the Difference, including why it's not always the best direction to go (as in, it's rare that it's ever a good idea. Great on paper, poor in reality), and also about investments. The leader of my office (called an RVP: Regional Vice President) hated the fact that I was learning more about the money side of the business (investments, insurance, etc...) and not so much about the recruiting side of things. I got really good at reciting the party line about how you must recruit and if you're friends won't do business with you then they aren't your friends and could even call up someone to recruit them and point out the flaws in being an employee while at the same time questioning a few things about Primerica (for example, they say that at Primerica we have freedom, that we aren't held to a schedule because we are adults, then why am I expected to work six to seven days a week, 7 am until midnight if needed and make every team, office and company event? Evidently the company and I had different definitions of the word 'freedom'). In a 12 month period I spent $100 for convention tickets, plus $100 to get to and from the convention plus $70 for the hotel room (12 of us crammed into a small room) plus food. Then there was a fast start school (local convention) tickets were $20/each and since I was a key leader I was expected to buy no less than five (told "When you recruit and you take the $100 for their application, go ahead and require them to buy a ticket. If they have $100 then they also have $120".), then after the first of the yea ...


When I first joined it was just join, make some extra money in your spare time. And honestly, who can't use an extra $500/month? At that point in time the office was never opened on Sundays because that was family day and the fast start school events were almost optional. Later things changed. People were only away from the office if they were on a sales call or if they were asleep. I took some hell for telling them that I wasn't coming in at all on Sundays. One guy, for his birthday his wife got him VIP passes to visit his favorite basketball team, meet the players, tour the area, etc. so he did. The RVP told him that she wouldn't waste her time like that until she was a few levels higher. I was only in it to make extra money and was told that instead of going to my step mother's birthday party I could have been at the office recruiting and been productive that night.

When the convention happened two people did not go. One because her grandfather was dying and did not know if he'd survive the weekend, the other gone through a bad break up with her baby daddy and he got back at her by calling CPS and had to take time away for that (rumor has it that she and her kids shared one bed, and CPS did not care for that). The RVP said that both cases were just excuses and that you shouldn't use your family as a reason to miss company events, but as the reason to make them. What is incredible is that both are still there and did not tell the RVP to fark off. Another thing I heard often was "Gas money shouldn't be an excuse!" When it comes from a woman who's parents retired in their 30s and makes over $10,000/month in over rides, her bit about gas money not being a reason to not go somewhere is almost insulting.

The only thing Primerica has over other MLMs is that there was no product to buy and store. But we had to buy everything from brochures to presentatations, monthly subscription costs to a sales tool, etc... When I joined the company I am at now, I was given all sorts of free stuff that Primerica would have charged for, and was shocked. Even to find out that the people who work there have spouses who don't and no one gives a damn is a step up from the Primerica view point of "If your spouse won't join you, then maybe your marriage isn't going to last."

What really changed things, for the worst in my view point, was a couple who explained how they reached RVP. They got one credit cards and sold out to large events. For the convention they got a charter bus, rented the entire thing and used that for motivation to recruit enough people to break even. They took that approach to everything they did. They were the ones I mentioned earlier who had their down line living with them. This got our RVP to do the same stuff. Big events were met with us being required (not asked) to make huge financial investments that many of us could not afford. Last January I found that it was not uncommon for those who were full time and not RVP to have 1099s recording negative income in excess of $12,000. Some of that was due to purposely writing bad business to win a contest, others was just charge backs from those who were pressured onto buying and later didn't want it or could not afford it. I fared better because I refused to tell clients that selling to me was worth cutting back in their lives. The RVP, on the other hand had no problem telling clients that buying from her, and being recruited was worth a Christmas of cutting back.

Now I am one who they all hate. I sell all kinds of life insurance. The idea that term is perfect for all is wrong. Also with Primerica when you sell you get paid twice. You get 75% of your commission up front and you get the rest on the 12 month anniversary. If it cancels before, you pay back the 75% through future commissions. Other companies do the same bit, but they also pay annual residuals. Some health insurance companies pay residuals each time a payment is made. Primerica only pays residuals on investments, which is more money for another license and class room materials.

I could go on, but I am typing ths on an iPad...
 
2012-12-21 12:51:08 PM  

cefm: This douchebag Pershing is attempting to achieve exactly what is NOT supposed to happen in a properly functioning stock market, which is to influence the valuation of a company's shares simply by saying things, and with the clear intention of lowering stock prices in order to benefit by a short-sale bet he made against the company.


Which stock markets have you been following for the past 90 years? Stock valuation is based mostly on projections, and a huge influencing factor in those projections include statements made by by companies issuing the stock, industry leaders, and large investors in the stock. Pershing is putting his mouth where his money is. "I'm shorting this stock. Here's why."
 
2012-12-21 02:05:01 PM  
I gotta say, I'm always amazed at the Stockholm Syndrome of Amway/Herbalife/Quixtar/Primerica suckers. They'll even sign up for Fark to defend the nonsense.

Here's a question to ask yourself on whether you're getting a job or getting scammed when you "join" a company:

In this employment crisis, what reputable profession is so lacking in candidates that they will take anybody? What reputable profession doesn't require any expertise whatsoever, and simply requires one to sign up?

/anyone... Anyone?
 
2012-12-21 02:22:18 PM  

VGA Hole: I gotta say, I'm always amazed at the Stockholm Syndrome of Amway/Herbalife/Quixtar/Primerica suckers. They'll even sign up for Fark to defend the nonsense.

Here's a question to ask yourself on whether you're getting a job or getting scammed when you "join" a company:

In this employment crisis, what reputable profession is so lacking in candidates that they will take anybody? What reputable profession doesn't require any expertise whatsoever, and simply requires one to sign up?

/anyone... Anyone?


a1103.gc.akamai.net

Sorry, low hanging fruit
 
2012-12-21 02:30:32 PM  

VGA Hole: I gotta say, I'm always amazed at the Stockholm Syndrome of Amway/Herbalife/Quixtar/Primerica suckers. They'll even sign up for Fark to defend the nonsense.

Here's a question to ask yourself on whether you're getting a job or getting scammed when you "join" a company:

In this employment crisis, what reputable profession is so lacking in candidates that they will take anybody? What reputable profession doesn't require any expertise whatsoever, and simply requires one to sign up?

/anyone... Anyone?


i.neoseeker.com

This still relevant?
 
2012-12-21 02:30:57 PM  

Great Janitor: ***snip***


I got nipped by a Cydcor affiliate. After several months of losing money on gas, I quit. At least on the positive side, I met one of my best friends while working there. Now I have been at my next job for 5 years and while it is nowhere near as bad as door to door business AT&T sales, it is boring as hell and I have very little hope for advancement. At least it is an actual steady paycheck and I can spend 85% of my time on Fark.
 
2012-12-21 02:33:03 PM  

VGA Hole: I gotta say, I'm always amazed at the Stockholm Syndrome of Amway/Herbalife/Quixtar/Primerica suckers. They'll even sign up for Fark to defend the nonsense.

Here's a question to ask yourself on whether you're getting a job or getting scammed when you "join" a company:

In this employment crisis, what reputable profession is so lacking in candidates that they will take anybody? What reputable profession doesn't require any expertise whatsoever, and simply requires one to sign up?

/anyone... Anyone?


The thing about Primerica is that on the Better Business Beauro they have an A+ rating and with AMs Best (Insurance rating company) they are in the top 15%. As far as taking anyone, with Primerica that really isn't true either since you have to pass a background check (No bankruptcies and no felonies) due to state requirements.

Also, think about it this way, in this economic situation, if a company needs employees, doesn't that mean they are doing well and expanding? Or at least that is the Primerica answer. The economic situation and a company's growth don't always go hand in hand. In the 1990s you'd think the economy was in the toilet is you looked at the typewriter repair industry and no other industry. Even when times are bad people still make money, some businesses still grow. When Obamacare passed I realized that like it or not, people are going to have to carry health insurance on themselves, and many companies are going to be dropping health coverage due to costs. So I got my Health and Life license so I can make money off of Obamacare. Seemed to be the smart move. Do you think if the economy continues to suck that the insurance companies and their sales agents are going to suffer or prosper? As long as a company sells products that the public needs they are going to make money. Add in a mission statement about helping families to make insurance agents sound like modern day white knights slaying the dragons of bosses, being employees, etc... and that is how Primerica recruits. I did the same thing. I knew what words to say to get others to join and fork over $100 and the names of everyone they ever met. I could recruit an 18 y.o. fresh out of high school, get her to pay me $100, hand me that list of friends and family, sell to her parents, make $500 off that sell and make her fill like am idiot when she asked me when she was going to get a cut (she wasn't licensed, paying her would be a crime, and I made sure to sell to everyone before they got licensed, earning about $2000 per recruit so when they got licensed their entire warm market was tapped by me, just as my trainer did to me and they did to their recruits). I just got to the point where I realized that was wrong and stepped away, let the kook aid flush out of my system and never went back.
 
2012-12-21 03:04:44 PM  
It's off 18% today so I'd say Ackman was right, at least for now.
 
2012-12-21 03:48:21 PM  

tricycleracer: Land Ark: Dr.Mxyzptlk.: So I should move my money into ExtenZe

Don't be an idiot. The smart money is in Beezid.com.

All my money is in Zombo.com.


I've heard you can hardly do anything there. Is that true?
 
2012-12-21 03:54:38 PM  

relaxitsjustme: It's off 18% today so I'd say Ackman was right, at least for now.


This. Lot of easy money I left on the table by not shorting some myself this morning. /facehoof.
 
2012-12-21 04:17:12 PM  

ongbok: From what I hear, Amway is big in China now.


Chinway?
 
2012-12-21 04:20:50 PM  

Ishidan: ongbok: Christ your experience with Priamerica exhibits all of the classic signs of cult indoctrination. You have sleep deprivation and nutritional deprivation to weaken your judgement while they repeatedly preach their repetitious mantra. And from what you described they even use insults and embarrassment to make people fall in line with their way of thinking and to drive them away from anybody that isn't a part of the "company".

Correct. Kirby does the same thing.


Sounds like Vector Marketing AKA Cutco.

They flat out lied to you and made you lie to customers "Oh, we'll never call anyone that didn't give us the ok first" is what you tell them to get names. Once your leads start to dry up, they tell you to call the people on your list and say "Oh, oops, I thought I'd gotten a yes. While I have you on the phone..."
 
2012-12-21 04:33:25 PM  
FTA: "recruits unwitting "distributors" with the promise they can achieve the lofty incomes only reached by a miniscule subset of those involved in the business."

Pretty much every corporation in existence right there.
 
2012-12-21 04:41:27 PM  

www.myfacewhen.net
"Multiple Level Marketing companies are pyramid schemes"

 
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