There have been so many controversies about Herbalife and its MLM program. Many people want to know what is Herbalife MLM. Many people are not too sure about Herbalife’s legitimacy. Is Herbalife a scam?
The mere mention of “Herbalife” makes you want to ask if the company is into the selling of cannabis or weed. Even the company’s logo gives some credence to such thought.
But, my research shows that the company is not in that line of business. Herbalife is in the business of selling weight-loss, beauty, and nutritional supplement products. The truth will be revealed in this review.
As you read further, I will shed more light concerning the company, its products, compensation plan, pros and cons so you can make informed choices.
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What is Herbalife?
Herbalife is a multi-level marketing company based in the United States of America selling dietary and nutritional supplements worldwide.
The company is specifically based in Los Angeles, California while the incorporation of the company was done in the Cayman Islands.
Founded in 1980 by a 24-year-old man known as Mark Hughes, Herbalife started its journey into prominence. He later died in 2000 at the age of 44 due to an overdose of alcohol and antidepressant.
Herbalife became a public company in 1986 on NASDAQ. This company is a colossus in the MLM industry. With operations in over 95 countries, Herbalife ships products worth more than five billion dollars every year.
The company is also known for philanthropy. The Herbalife Nutritional Foundation supports the nutritional needs of many poor children across the world.
It is not easy to survive the tough challenges of being an MLM company but Herbalife has done well to float through the tough times and emerge successfully for more than 4 decades. Michael O. Johnson is the current chairman and interim CEO of Herbalife.
What is Herbalife MLM?
Herbalife MLM is a business opportunity for individuals looking to sell products and make money. This is where Herbalife makes most of its profits and there has been a constant accusation that the company is a pyramid scheme. This is not true 100%.
Herbalife has more than 4.5 million independent distributors across the world which is not a mean feat.
The company has a detailed compensation plan for people who join as its distributors. Herbalife ensures that its distributors are paid on time depending on their sales and recruitment efforts.
As part of Herbalife’s MLM program, the company offers extensive support through its global community of distributors.
It also provides detailed training and learning material, a distributor-only website, a top-selling products kit, and other business resources.
How does Herbalife MLM work?
To work with Herbalife MLM, you have to be part of it as an independent distributor. This can be done by registering yourself on Herbalife website.
Every individual has to register through an existing distributor who told you about Herbalife MLM. In case, you don’t know any distributor contact 1-888-4Herbal to get assistance.
One of the other requirements to complete your registration is buying a distributor kit. There are two types of distributor kits – the International Business Kit which goes for $94.10 and the International Business Pack-Super Starter which costs $124.10.
Once you have purchased the kit according to your preference, you will receive all the tools and resources along with education material to learn and kickstart your Herbalife MLM business.
Herbalife products are available in 5 categories. This includes weight loss, vitamins, fitness, and energy.
In recent times, the company delved into skin and healthcare products. Their flagship products like Formula 1, 2, and 3 are the newer versions of the original formulas that were sold by the founder, Mark Hughes.
Here is a 7-minute video on how Herbalife products are manufactured.
Weight management and control – This is essentially for fat people. Healthy Meal Shakes is ideal for weight control and management. This category mainly has protein shakes, powder, bites, herbal tea, tablets, and snacks.
The products are available as individual items and meal programs. One of the highlights in this category is Herbalife Formula 1 Nutritional Shake. This is a decent product that comes in different flavors.
It helps reduce cravings and provides balanced nutrition to your body with the help of soy protein combined with carbs, essential vitamins, and minerals.
Health and skincare – Radiant and healthy skin is a must for people. For this purpose, there are different products such as collagen boosters, acne kits, cleansers, moisturizers, toners, serums, and facial masks in the health and skincare category of Herbalife.
Herbalife Skin is one of the main brands in this product line. Its Ultimate Program is an ideal package of multiple products in the form of creams, moisturizers, serums, etc.
The product is marketed to work on normal to oily skin. It helps to improve the appearance of your skin with the help of vitamin B3, antioxidants, aloe vera, and botanical ingredients.
Energy and fitness – If you are an athlete, your body needs nutrition to perform better. Herbalife 24 is one of the best products you can go for.
Herbalife 24 is a set of shakes, protein powder, and crispy snacks. The product is made with a focus on athletes who always need to remain active and energetic.
Herbalife 24 Formula 1 Sport is another nutritional shake with the necessary proteins, vitamins, carbohydrates, and minerals to build and maintain lean muscle and generate sparkling energy.
Nutritional products – No matter your age, you need good nutrition to enhance your health. CoQ10 is a nice product to boost your nutrition.
CoQ10 are softgels for a healthy heart. It contains vitamin D and CoQ10 antioxidants that help provide energy to heart cells and support heart muscles.
Some of the other products include immune support, healthy aging, and women’s health categories.
Herbalife offers a standard 30-day refund on all its products. Distributors get an advantage selling products with an assurance of 30-days return/refunds.
Are Herbalife products worth their price?
Herbalife has a lot of haters and fans just like every other business in the MLM model. The products have worked for some people while others say the products are ineffective. The products are good as far as they are used in moderation.
Some distributors make bogus claims about the products. Such claims go against the company’s policy which could lead to the immediate termination of such distributors.
Herbalife products are not extraordinary. The fact that the company has been selling these products since 1980 makes the difference.
There is no doubt Herbalife is seen as a brand and with products, in close to 100 countries it makes half the job easier from a selling perspective.
Having said that, Herbalife product reviews have been on the positive side (most of them). Surprisingly, some of these products are sold on Amazon.
If not officially, you can order them if you don’t like purchasing directly or through its distributors. But beware of the genuineness.
Herbalife Formula 1 is liked by many for its taste and energetic results. This product is priced at $50.90. Search for any other product with similar ingredients and benefits and you will find multiple results like the below:
Comparatively, Herbalife Formula 1 pricing is at par with other products.
Herbalife Skin Collagen is another product that is quite popular. This is priced at $58.65. Some of its alternatives cost between the range of $30-$40. So, this seems to be a bit pricey.
Overall, the pricing from Herbalife is competitive. Some products are expensive and some are at par. Considering Herbalife’s background and reputation, the products are worth their pricing.
How to make money with Herbalife MLM?
Since Herbalife is an MLM, there are primarily two ways you can make the most of the money.
Sell Herbalife products as its distributor – By becoming a Herbalife distributor, you can sell products to anyone at a full retail price.
Herbalife offers a 25% discount on all its products to its distributors so the difference in pricing remains your profit.
Build a team and make money on their sales – Herbalife offers multiple bonuses and rewards for sponsoring people in the company.
When you build a team of people who purchase the products and sell them further under your mentorship you get to earn these bonuses and rewards.
Herbalife Compensation Plan
On paper, the company has a good compensation plan. These plans are of 7 different levels. They include:
Retailers’ profits – You can earn up to 25% profit if you sell some of the products at retail prices. Your ranking level determines the percentage you get when you make retail sales.
Whole sellers’ profits – This plan is for people who buy products at a discounted price and sell to their downlines in wholesale. This profit is between 8% to 25% and depends on your ability to maintain your downlines and their purchasing capacity.
Monthly royalty plan – The reward at this level is when you get to the Supervisor position. At this level, you get the chance to earn a 5% commission. It takes a lot of work to become a supervisor because your downlines must be very active too.
To become a supervisor, you must have made product purchases of between $3,000 and $4,000 overtime.
Production bonuses – This is a monthly sales bonus for teams. Teams must be in 7th position to earn this bonus. Between 2% to 7% can be earned as the Top Achiever of the team.
Yearly bonuses – There are annual bonuses for top achievers. This is based on your performance over a period of one year.
Special training events and vacations – This is a great incentive for sellers who maintain consistent performance in a particular year. This plan makes a distributor mount some pressure on the downlines.
Mark Hughes recruiting award bonus – The Company sets aside 1% of its profit which is shared among top distributors. It is mostly those who joined in the early stages of the business that benefit from this bonus.
The compensation plan has many benefits but the financial outcome only depends on two factors. How much you sell and how many people you recruit. If you can achieve this consistently, you are up to making decent money with Herbalife.
Can you make money with Herbalife MLM?
As we discussed above, Herbalife’s compensation plan is generous enough to make good money but not without you putting in effort and hard work.
The monthly income of the Herbalife distributors who remained active in the first year was $190. People who spent more than a year were able to make $241 in a month.
To make decent money in the range of $1k+ you have to be in a top-level position mainly a supervisor or above and spend at least 3-4 years.
The income figures are without any expenses pertaining to traveling, advertising, etc. So, the final figures may come down drastically.
Do not forget to consider the investments in starter kits and the self-purchase of products you have to make to remain an active Herbalife distributor.
MLM companies have grown in huge numbers in the last 2 decades or so. The competition can lead to more challenges if you are pursuing to make money with Herbalife MLM.
Is Herbalife a scam?
Herbalife is not a scam. Had it been a scam it would have been shut down a long time ago. The company is still going strong with a number of changes in the management team and lots of curiosity about its products.
MLMs have their own challenges and when you add the controversies and lawsuits associated with them it gives an undue advantage to those who cannot get successful and start publicizing companies like Herbalife as scam.
Is Herbalife a pyramid scheme?
No, Herbalife is not a pyramid scheme. They have good products that help improve your health and wellness.
Recruiting people is part of every other MLM. This does not make every MLM a pyramid scheme. Recruitment is necessary to improve the earning capacity of distributors who cannot make enough money just by selling the products.
Herbalife was sued by Financial Trade Commission (FTC) for unsubstantiated claims and the company paid $200 million as compensation to avoid a shutdown. This singular act made the company escape from being tagged as a pyramid scheme.
The Financial Trade Commission (FTC) took the company to court because more than 350,000 people lost their money in the business between 2009 and 2015.
Herbalife paid $200m as compensation. Many of the distributors who lost their fortunes in the business were settled with this compensation. This litigation shows that Herbalife defrauded its distributors to warrant the FTC suing them in a court of law.
The first set of cheques was sent out in January 2017 while the second round of cheques was in May 2019. The amount on these cheques is between $100 and $9,000.
These lawsuits are definitely responsible for many controversies that resulted in sabotaging the reputation of Herbalife.
Frequently Asked Questions
Is Herbalife an MLM?
Yes, Herbalife is an MLM. The company’s main source of income is through a multilevel marketing business model.
Herbalife reported more than $5.5 billion in revenue in the year 2020 owing to the direct-selling and recruitment efforts put in by its distributors who work on commissions.
The company remains one of the pioneers in the health and wellness MLM industry.
Is Herbalife approved by doctors?
Certainly no. Herbalife has faced many challenges in the past. At a time, Herbalife was sanctioned by the Food and Drug Administration (FDA) for making false claims regarding its products.
It also faced a lot of backlash from doctors and nutritionists from various European countries.
Herbalife products have been accused of affecting liver functionalities in many people. Many investigations were carried out but the company came out of all these tribulations and emerged as one of the Forbes Best 500 Midsize Employers.
Why is Herbalife controversial?
Herbalife has been a favorite among controversies. This has got a lot to do with its inception. The company has garnered cult status in the MLM industry which prevents the criticisms and condemnation it attracts for its business model.
Secondly, Herbalife’s products and business model are associated with multiple allegations and accusations around the world. The one that makes it more controversial is the bribing case.
In 2019, the US department of justice charged Herbalife’s employees with bribing Chinese officials to procure sales permits and influence their media coverage. To resolve the issues, Herbalife agreed to pay $123 million in 2020.
Although the charges were settled they left behind the scars of dirty business practices that further deepened the controversies surrounding Herbalife.
Herbalife scandal Netflix
Another controversy that surrounded Herbalife is related to a documentary called Betting on Zero.
The documentary is based on the experiences of its former distributor Bill Ackman who sued Herbalife for running a pyramid scheme.
Even after multiple exchanges of false claims, misguiding facts, and wrong representations by Herbalife the documentary was widely acclaimed and nominated for Best Documentary Screenplay by the Writers Guild of America.
Long existence – The company has been in operation for 40 years. This is one of the factors to be considered if you are looking to work with an MLM company.
The longevity and stability assure that the company is there to stay even in turbulent times.
Good quality products – No matter how badly they have been criticized but people love the products from Herbalife. That’s the reason you will find many positive reviews on different online platforms.
The company is one of the veterans in producing health supplements and the reviews prove its credibility.
Variable pricing – Herbalife products are not too expensive and neither affordable. It is kind of confusing especially if you are a distributor.
Considering the stiff competition in the health and wellness segment an affordable pricing structure can help the company achieve consistent sales.
Too many controversies – This is one of the main reasons you should avoid getting associated with Herbalife.
The company has been involved in litigations and controversies for lying about the formulation of its products.
Too many complaints and bad press has affected the company over the years.
Difficult to make money – The compensation plan is very kind and the commission percentage is on the higher side but still it is difficult to make money with Herbalife.
This is because it is an MLM that requires constant selling and consistent recruitment. Both aspects are not sustainable in the long run.
Making 1000 dollars a month may take years of learning, hard work, and investment which can be spent on many other alternatives for greater returns.
Conclusion: Is Herbalife MLM recommended?
If you are serious about making money and that too in less time and investment then Herbalife MLM should not be your choice.
The company is just too complicated to be considered a source of daily bread and butter.
Yes, it is a brand but that’s the only saving grace and the interesting part attached to it.
The competition is huge, the products are too many, and with millions of distributors around the world, it doesn’t leave you any space to prove your selling and recruitment talent (if you have any).
Personally, I don’t recommend Herbalife MLM as an earning option. It can be a good choice to have effective nutritional drinks but if you really looking to make a potential income for a long time then check my recommendation below.
It is a worthy way to learn and implement an online business that helps you make money online while sleeping.