Does multi-level marketing live up to its promises?

(Photo: WKRN)

NASHVILLE, Tenn. (WKRN) – A friend or family member tells you about some product – maybe it’s skin care, vitamins, essential oils or jewelry they’ve just started selling. They say you can sell it too and make a lot of money, but is it true?

Answers about multi-level marketing are hard to find.

You’ve probably heard of other businesses like Amway, Avon, Mary Kay, Rodan and Fields, Herbalife and Mannatech just to name a few.

Their business model is also called network marketing; recruit people you know, make money off their sales as well as your own.

Thousands of people recently flocked to Nashville in October to learn how to successfully sell a product called Juice Plus. It was the company’s biannual Leadership Conference.

Juice Plus is a dietary supplement of fruits and vegetables in capsule form. A package of three blends sells for $71.25 a month.

Amy Pritchett is a first time attendee at a Juice Plus conference.

“A friend of mine told me about Juice Plus… I also found out about the business side of it and am looking into that,” Pritchett told News 2.

She just started selling Juice Plus, but hopes to reach the level of somebody like Kimberly Worlow, who has been selling the product for 11 years.

Worlow is at the top level and makes money not only from what she sells, but the sales of those she recruits as well.

When asked just how many people she has recruited, Worlow told News 2 “I don’t know, isn’t that crazy? I know at one point it was over 600.”

Worlow said “I can tell you I make four times as much as I made when I worked full time,” but she would not tell News 2 how much that is.

Director of Marketing for Juice Plus, Meredith Martin, did not say how much a representative could make either.

“It’s really how much time people want to invest in their personal businesses and how much they can make,” Martin said.

Representatives pay a $50 annual distributor fee as well as $100 for a ticket to the conference.

Worlow said she has never broken down what she spends monthly to sell Juice Plus.

News 2 asked Belmont business professors  Drs. O.C. and Linda Ferrell, both Distinguished Chairs in Business Ethics, if this is typical of multi- level marketing companies.

“Number one if you’re told you’re gonna make a lot of money that’s a warning sign. Because you become an independent business person. Everything you earn is what you sell,” Dr. O.C. Ferrell explains.

Direct selling, as it’s also called, is big business. “17 million independent contractors who are selling products for direct selling companies in the United States.”

One company that’s seen significant growth is Rodan + Fields, a line of skin care products. While their sales representatives might make claims about sizeable earnings, Dr. Linda Ferrell says the company itself is clear. “They’ll basically tell you of the 100,000 associates they have only 400 are in the very top tier and it’s a real long shot so don’t think this is a make money quickly operation the 400 people they have at the top tier work their tails off,“ she said.

News 2 contacted Rodan + Fields for clearance to speak with a local sales person but our request was declined.

Selling these products, whether it be skin care, essential oils, or supplements, usually starts with contacting people you know. Friends and even family members are often sympathetic and supportive customers, but multi-level marketing has also been known to strain those relationships. Dr. OC Ferrell says “individuals have to make a decision about that. I don’t think there’s a general rule or principal you can apply to it.”

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