Many love Herbalife. Officially known as Herbalife Nutrition, it is a multi-level marketing (MLM) company operating in over 90 countries worldwide selling dietary supplements, with over 4 million independent distributors of members. .
Founded by March Hughes in 1980 the company is founded in the Cayman Islands but is currently headquartered at Los Angeles, California, U.S.A..
Health supplements and other related products have served to complement our nutritional needs one way or another. Herbalife claims to be one of these nutritional supplements. And if you’re not yet a user or a distributor, a friend may be bugging you to become one and join the Herbalife global family.
Well, before you even begin another step, check this Herbalife Product MLM Review!
Herbalife offers a wide range of products. From protein supplements to multivitamin and minerals tablets to teas and juice, etc.. All these products are sold through independent distributors by direct marketing or selling them directly to customers.
By principle, Herbalife does not advertise as most companies do, but rather uses the personal success testimonies of their members to promote their products. Income is earned by independent distributors from direct sales or commission from the sales of all other independent distributors under him in his own network.
Herbalife Nutrition Direct Selling MLM?
Mark Hughes, founder of Herbalife Nutrition initially sold his product from his car trunk. His product, originally for weight loss or management, came after he had concerns of some unhealthy weight methods and eating disorders which he attributed as the cause of his mother’s premature death.
With its first product the soy meal-replacement protein shake for weight loss, Herbalife has since grown to a multi-million dollar company, with products now including protein bars, vitamins, aloes, teas, energy and sports hydration and personal care.
In one of it’s websites, Herbalife stated that it’s goal is to change the nutritional habits of the world. This includes of course, enticing people to take their meal replacement protein shakes as an integral part of one’s daily meal intake and drink their vitamins and other health drinks and use their personal care products.
The company is structured using the multi-level marketing (MLM), direct selling method of making product sales. In 2010, the Los Angeles Business Journal said that Herbalife Nutrition is one of the most profitable businesses in Los Angeles County.
A Direct Selling (MLM) company is a business model whereby distributors called direct sellers earn income through both by direct sales to users and when sponsoring new members who also want to become distributors or direct sellers with potential income from the direct sales of these sponsored distributors often called as “downlines”. Others call this business scheme “network marketing”.
FTC (Federal Trade Commission) says “Direct selling is a blanket term that encompasses a variety of business forms premised on person-to-person selling in locations other than a retail establishment, such as social media platforms or the home of the salesperson or prospective customer.”
Other sources say that direct selling includes: “The direct personal presentation, demonstration, and sale of products and services to consumers, usually in their homes or at their jobs.” In fact today it has expanded to include internet sales, personal contact arrangements and one-on-one presentations and demonstrations.
Herbalife Nutrition Product Review (Formula 1 Protein Shake)
With a varied choice of allegedly highly nutritious products and excellent skin care, Herbalife would want customers to think they have what is most needed by almost everyone.
But the question that needs to be asked is: Is the product worth its Price?
Let’s take for instance the most popular Herbalife Formula 1 Protein Shake. A meal replacement powder in various flavors. This product is suggested to be taken twice a day to replace 2 meals a day at two scoops per meal, for weight loss.
The Protein Shake canister or 26-ounce package can be valued at $40 on average depending on where you have bought it. Why average because the price varies. In the Herbalife website it costs $42.85 while Amazon says it’s only $40.
This product garnered many positive reviews on Amazon. Some dieters said that they lost weight replacing 2 meals a day with Formula 1. Each meal replacement is supposed to be 2 scoops, and with 2 meal replacements a day that should total to 4 scoops a day at the least.
Although we can have no question as to its nutritional value, the question we may have: Is Herbalife Formula 1 worth the price?
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See How this Works Out and Do The Math.
The Herbalife Protein Shake powder should last around two weeks or roughly 14 days. The canister’s contents is 26.4 ounces. Taking the price of $40 per canister should give us a price of $1.52 per ounce. Or taking $40 per canister for 14 days would mean a budget of $2.86 per day.
Let’s compare to a similar product that is also sold in Amazon but half of Herbalife’s price. It is called Orgain Organic Protein Powder. Sold for $26.99 for 2lbs. container or at $.83 per ounce. This is way cheaper don’t you think?
But wait, what about the contents and ingredients?
The Orgain Organic Protein Powder is certified by the USDA as organic, vegan, gluten free, and lactose free. This is one thing that one cannot find in Herbalife Formula 1 Protein Powder. Except that both products are for weight loss provided it is complemented with a good and regular exercise routine, they differ much in price.
So coming back to our question if Herbalife Protein Shake is worth the price, necessarily we answer as No!
Well of course the buyer has to decide for himself or herself, but this review is to let you know that there are comparable products you can try at a lesser cost but with equal if not better quality. Why so? Because it’s sold for its proper price and not padded with more cost for distribution to more people in the MLM scheme.
Herbalife Direct Selling MLM Opportunity Review
The Herbalife business opportunity is a typical framework of a direct selling company doing MLM or Multi-level Marketing.
To become a distributor or direct seller, one needs to sign up through another distributor called a sponsor or the person you are under the multilevel network.
As a new sign up one becomes a downline of the sponsor and can now begin selling products or recruit and sponsor his or her own downlines to create his or his own network.
The sponsor gets a percentage commission from all the sales of his downlines. Each individual direct seller can earn income by commission from downlines or profits from his or her direct sales. For distributorship outside the United State, one can register online and have your documents mailed to his or her country’s local member services.
How Much Money Does to Become an Herbalife Independent Distributor?
To become a member, one needs to sign up by purchasing an Herbalife Distributor Kit. One can choose between the International Business Pack for $94.10 or the International Business Pack-Super Starter for $124.10.
The sign up cost may not be all that this business will cost you. There are invisible costs such as the time you need to invest to build your business. This could include time spent on phone calls, client or customer calls, gas and other miscellaneous costs. Also you need to secure your own business permits and pay government fees for running a business including your income tax.
Is Herbalife Business Profitable?
On the onset one needs to bear in mind that there is no base pay when doing an Herbalife business. You are treated as an independent distributor or seller with commission and incentives.
For you to make money you have to recruit new members from whom you gain commission or sell directly to customers. As an independent distributor, you can buy the products from the company with a 25% discount. You can sell them at its suggested retail price. This then offers you a 25% commission for each sale.
When your recruits or downlines also start purchasing products for their personal use or for business to sell also to direct clients, the company will retain a portion or percentage of their overall monthly purchase payments as commission to you as upline or sponsor and for the many other sponsors up the line of the network. This is your commission income that is available for you every month usually paid to you in check.
Aside from commission from your downline, you can also earn income from your own personal direct sales. This is money direct to the pocket.
Advantages:
Master of Your Own Time
Direct selling business models become attractive to those who want to do business on their own because they offer a very flexible work time and schedule. Income is parallel to the effort one wants to put into his or her independent business.
An independent distributor can work part time or full time. But at any rate, you can always fit and suit your working hours to your most convenient time schedules.
No Monthly Minimum Purchases
For independent distributors with 25% discount on purchases, no monthly minimum purchases is required. This privilege discount is enjoyable for life for as long as the membership is renewed every year or purchase a product each month.
However, as you try to run up their leaderboard, this will change. The company will now set a quota of purchases for each level each month as you go up. With these also come higher commissions and incentives.
Products can be Fully Refunded
Once you cancel the distributorship, the products can be fully refunded provided that it is yet un-opened. Just follow company procedures for return and refund.
All Sales Tools are Personal
Except for those materials and literature that come with signing up for Distributorship or the Distributor Kit, there is no requirement to purchase certain marketing tools.
Disadvantages:
Herbalife Has No Approval from the FDA
Sadly, the Federal Food Administration (FDA) has not given Herbalife its approval. Although the company cited “FDA Approved” in its marketing videos back in 2014, this was stopped and FDA commanded the company to stop misinformation and spreading false claims.
The Company Encountered Controversy on Both its Products and Business Schemes
Not long ago, Herbalife was heavily criticized for its business schemes and among others Bill Ackman of Pershing Square Capital, who said that Herbalife is a “sophisticated pyramid scheme”.
In the early part of 2019 the company also came under the scrutiny of both by the United States Department of Justice and the U.S. Securities and Exchange Commission (SEC) for corruption in China. And on September 27, 2019, the SEC has said that Herbalife, without necessarily admitting fault, conformed to pay $20 million in settlement of charges of falsely making misleading statements of its business model in its operations in China between years 2012 and 2018.
And not only that, Herbalife’s claims of its product’s health benefits have likewise come under strict scrutiny by government agencies, consumers and the medical community.
In 2008, Herbalife was charged after laboratory tests indicated the presence of lead in several of its products in excess of California state law on fears that it can cause problems in the liver if used for an extended period of time.
The company took a commission to look into these allegations who found otherwise. Some of the negative feedback on its products and its business scheme caused Herbalife to reformulate some of its products and even re-branded itself.
Products May Appear Expensive
Compared to other products of its kind, Herbalife products may come a bit expensive. This has been said here previously in the case of its Protein Shake Formula 1.
The same thing can be said of its Herbalife SKIN Collagen Beauty Booster. A drink supplement that costs $49.40 for a 6-ounce canister in Strawberry lemonade flavour which has a similar product elsewhere at much lesser cost.
BBB (Better Business Bureau) Complaints
Herbalife has not received much review with BBB (Better Business Bureau) with an A- (A-negative) rating and only 2 1/4 star rating. Customers who purchased the products had mixed reviews and some distributors expressed dissatisfaction. So far, Herbalife answered only 1 complaint listed in its website.
Lawsuits
Herbalife has had numerous lawsuits to contend with currently and in the past. In fact the BBB website posted an alert for Herbalife. This alert came after allegations of corruption and misrepresentation in China.
Another lawsuit against Herbalife is the class action from some distributors on claims that the company misrepresented as to the amount of money due to them. Many of the lawsuits against Herbalife including this one have been settled with Herbalife paying huge amounts of money in exchange for findings of no fault.
Is Herbalife MLM a Pyramiding Scam?
While there has been no conclusive evidence that their products are really harmful, except that they are a bit pricey, the company however has been haunted by various controversies not only about its products but more so of its business schemes.
Because of these issues, one better approach this company with caution. As to its products, read the contents, compare prices and decide based on your need and budget. There are consumers who are able to say that they have benefited from Herbalife products and so do not mind the price. But there are also others who said that they could get the same value for a lesser amount in another product.
As to its Direct-selling MLM business model, there is yet no conclusive decision to label Herbalife as an illegal pyramiding scheme. As it appears, there was a settlement on the SEC issued of the company’s mis-representations of its business schemes. So in this sense, Herbalife is not a pyramiding scheme.
But then again, one has to approach the company with caution because of these issues. If one intends to try their business opportunity, then by all means read and research well before signing up to become an independent distributor. Do not be misled by the enticements of the commercial talks of your supposed sponsor.
Always remember that after you sign up, you become an independent distributor, meaning you do your business yourself while your sponsor and other people above you in the network, profit from all your hard work. But of course, as your network grows, you can profit from all of them too. They call it “Copy Business”.
Final Observations:
As to its products, Herbalife fairly classifies within the nutritional supplement category and may be added to your usual diet and augment supplementation of the basic nutrients needed by the body. They also have personal care products and others which all claim good benefits to users. Well the products are good, but pricey.
It’s Formula 1, Protein Shake claims to be an effective tool for weight loss. Examining it closely reveals that weight loss may be due to calorie restrictions in the diet as it is used as a meal replacement with only less than a 100 calories for 2 meals a day. So this simply means that weight loss doesn’t really come from the product itself, except that since it is protein, it can help you feel full and curb appetite and lessen hunger pangs.
As to its Direct-selling MLM business scheme, we can find that income is generated by commission or direct sales profit. The only hesitation one can have is that it has no base pay. So income depends on one’s industry, connections and business marketing and promotions. Unlike what most of their distributor says, doing Herbalife business gives you no easy money. It’s hard work.
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