[Today we’re continuing to celebrate National Consumer Protection Week with more MLM scam awareness. The FTC has some good advice on MLMs from its recent consumer warnings, “Most people who join MLMs make little or no money. And, if promoters emphasize recruiting as the real way to make money, walk away.”]
Multi-level Marketing (MLM) is not a business. Many MLMers say it is a business and act like it is one, but it simply isn’t. It is a wolf in sheep’s clothing.
It’s a tall order for me to prove this. I’m a firm believer that big claims require big support. I don’t believe it is that big of a claim, just the big lie told by the MLM industry. It’s not a coincidence that the average person likely can’t distinguish them from a pyramid scheme.
MLM’s Deceptive Doublespeak
To start, MLM often attempts to disguise itself under other names in hopes that its terrible reputation is not detected. That’s why you see it called “Network Marketing”, “Direct Sales”, or even “Community Commerce.” For now, let’s agree to call it MLM because that’s the only term that explicitly states the “levels” that are the defining characteristic of every MLM. Direct selling could be hosting a yard sale or putting an object on eBay. That is clearly not MLM. Network marketing could refer to an advertisement that you see on ABC/NBC/CBS etc. which is also not MLM.
The naming deception is not one of the reasons it is not a business. I simply needed to address it before we can move forward. If someone tries to recruit you into “network marketing” or “direct sales” it is best to run away from their deception.
Why MLM is Not a Business
With that out of the way, here are just some of the reasons why MLM distributors are not businesses:
- Businesses obey the Commandment of Control
This is something that I first read in The Millionaire Fastlane by MJ DeMarco. (I highly recommend this book.) MLM Distributors do not have control. DeMarco explains:
I was involved in four MLM companies. Not once do I remember dictating product decisions, research & marketing, marketing restriction, rules, cost analysis or any other activity fundamental to owning a business.
If you aren’t participating in fundamental activities related to owning a business… you can’t call it a business, right?
- Business 101 Excludes MLM
One of my brilliant readers noted:Business 101 teaches that in order for you to be considered a business owner there are three ‘musts.’ You must have control of the product, you must have control of the distribution, and you must have control of the pricing. These people are not business owners, they are recruiters/salespeople.
Every MLM that I’ve looked at fails these three principles. MLMs claim that distributors set their own pricing, but MLMs set the pricing to their
victimsexcessively high because that’s where they make the money. MLM salespeople can’t charge less or they’ll lose money. They can’t charge more for three reasons:1. The products are already excessively high priced from the MLM company.
2. People can get the products at distributor cost (usually by signing up to be a preferred customer themselves)
3. The MLM distributor can’t compete on pricing with the other salespeople. They can’t charge more, because they don’t add any value to the consumer. - Businesses obey the Commandment of Entry
This also comes from DeMarco above. You have to be able to build a moat around your business and prevent others from competing with you. DeMarco again explains:
“Network marketing, or multi-level marketing (MLM), always fails the Commandment of Entry — unless you own and create the MLM company yourself. If you’re in a room with 2,000 other people who do exactly what you do, you’re fighting stiff probabilities.”
One thing to keep in mind is that those 2,000 people are taught to recruit more people to compete with your business. There is no moat to protect your business. It is the exact opposite, where they are encouraging more people to compete against you.
I’ll get to it in a few more bullet points, but this competition is part of the reason why 99% of MLM distributors lose money.
- MLM Doesn’t Obey the Laws of Supply and Demand
McDonald’s won’t let franchise owners open up multiple ones on the same street unless there is sufficient demand. Otherwise, they would compete for few customers and go out of business.
MLM has no problem with creating millions of distributors even if no one is interested in buying the product. They don’t ensure that there’s enough product demand for the distributor to make money. I often find that plenty of product is available with a simple eBay search.
If you put ten McDonald’s on the same block, you’d expect them to lose money and go out of business. You wouldn’t blame the individual owners of the McDonald’s franchise. When 99% of MLM distributors lose money, they are the ones that are blamed for the failure.
- More than 99% of people LOSE money
Some MLM companies produce what is called an income disclosure statement so that their distributors can talk about the MLM as if it were a business opportunity. Analysis of these statements show that more than 99% of people lose money in MLM. Need examples? See this or this. I did the analysis for MonaVie a few years long ago. It’s easy to see once you learn to read the fine print in the income disclosure statement. I cover how to do that in my Beachbody article.There are a lot of people in MLM bragging about making money. Many of them are “faking it until they make it”. As the FTC says, “blockquotMost people who join MLMs make little or no money.” Some of the people at the top might actually be making money. However, we know that a lottery winner is not the typical representative of what happens when you play the lottery, right? And if those people at the top are making that money from a recruited “downline” it is a pyramid scheme.
- MLM is Not like Any Other Small Business
Some MLMers claim that small businesses generally have a high failure rate. “High” is a relative term… and it doesn’t come close to comparing with MLM.The U.S. Small Business Administration has this handy PDF of information. It seems that “7 of 10 survive the first two years” (30% failure rate over two years), “half at least 5 years”, “a third at least 10 years”, and “a quarter stay in business 15 years or more.”
Let’s compare this to an MLM where 90% are failing every year. I’m being very generous given the proof above that 99% of them lose money. If we start with 100,000 people and 90% fail each year, there are 10,000 people after the first year. In the second year, another 90% fail, and we are left with 1,000 people. That’s a 99% failure in MLM vs. 30% in traditional small businesses in just two years. After 5 years, there is just a single person in MLM. In traditional small businesses, you still have 50,000 of the initial 100,000.
Do you want a 1 in 100,000 chance of being successful or a 50% chance? If you have to think about this question, please have the self-awareness to realize you are not intelligent enough to be that 1 in 100,000.
- It Doesn’t Matter How Hard You Work
MLM supporters will claim that those who lose money just didn’t work hard enough. That’s not true. It’s simple mathematics that guarantees almost everyone will lose money. You can only make money if large numbers of people are recruited below you. That necessarily precludes almost everyone from making money, because they can’t recruit into infinity. As the pyramid below you gets wider, the new participants added have an even smaller chance of making money because there aren’t enough people in the world for everyone to make money.
It’s like telling someone that they can hit ten holes-in-one consecutively in golf. Anyone can work hard on your golf game day and night, but the circumstances of hitting ten holes-in-one are so extremely difficult, that’s hard to say whether it has ever been done. If someone fails to hit ten holes-in-one, we don’t tell them that they didn’t work hard enough… we simply say that the goal was unattainable to start with.
MLMers might counter that another person in the MLM attained it. It’s always because they didn’t have to work their way up there competing against everyone else. They were people who started at the top or brought their pyramid scheme from another MLM with them.
I hope you made it through all the above (or at least enough of them to realize that MLM is not a business).
Typically, when people understand that MLM isn’t a business they ask me, “What’s better?” I counter with “What’s worse?” A minimum wage job at McDonald’s is much, much better than spending your time to lose money. You might not like to take a job picking up dog poop, but it is profitable in the first hour.
While those are true, they aren’t very inspiring. A McDonald’s employee has a job… he isn’t running a business either. A dog poop service is a business, but you might not be interested in that business.
So why not start a business on your own? Follow your passion… and see if you can find profitable ideas in that area of interest. Here’s an extremely well-reviewed book to get you started: The Lean Startup
This article was originally published on January 15th, 2016. Some of the links in this article may go to books or products where I would earn a commission if you buy it.
“Business 101 teaches that in order for you to be considered a business owner there are three ‘musts.’ You must have control of the product, you must have control of the distribution, and you must have control of the pricing. These people are not business owners, they are recruiters/sales people.”
Guess what? I have full control over all three and I pay the rent. I have the licenses to run a financial service/Insurance company. I choose to be exclusive to Primerica. Therefore, I have chosen the products I sell out of my office. I control the recruiting and who I want in my office. I have chosen the method of recruiting by choosing Primerica. And, all my agents know what it takes to make money with Primerica because I train on this. I therefore own my own business.
Whoa, are you actually going back to referencing the article and trying to make a point?!?! Of all the death threats I’ve had from covering MLM, this attempt to give me a heart attack from shock is probably the most serious threat to my life!
So you get to control all the Primerica products? You can change coverages and prices, annuity rates, and all that? I haven’t studied Primerica, but it would be hard to believe that you set all the financial terms for the financial products. If I owned my own insurance company, I think I could set those rates, right?
Do you really control the distribution? I believe there were rules and regulations about marketing to military members that I read just minutes ago. It seems like Primerica has significant control over distribution. However, to circle back to the topic, “MLMs in general”, I haven’t found any that welcome distribution on Ebay, Amazon, and Craigslist. In fact, they have no ability to distribute in those common DIRECT SALES avenues.
Do you really control the pricing? You can sell me a million dollar whole life insurance policy for a single dollar a month? I’m not saying that it would be a smart idea for you to do that, but you can really sell these kinds of Primerica insurance policies? Again, I don’t see how you can say this is possible with Primerica. If it is, then I ask you to put your money where your mouth is and sell me that policy.
Of course every MLMer controls who they recruit to. However, if you read what you quoted that is irrelevant. I’ve heard of MLMs where people recruit their dogs to get extra “salespeople” (salesanimals?) in their downline.
Paying rent in your office also means nothing. I presume Bernie Madoff paid the rent for the floors of the office space of his pyramid scheme. I could pay rent for a brothel, meth lab, or a dog fighting arena. It wouldn’t make it legal or a legitimate business. I DO NOT condone or endorse any those EXTREME examples on purpose, but at least they provide the end product, not an endless chain recruiting scheme as with many MLMs in general. They would also be profitable on day 1 and not just selling the business of being in business.
I’ve seen a lot of bad arguments to legitimize MLM, but “I pay the rent”, is up there with the worst.
Can you still work with Primerica and NOT choose to be exclusive to Primerica? That’s a big test. Do they give you that choice?
Oh you believing in your training of your downline. I don’t think that was a core test in the legal proceedings that shut down Vemma and Fortune Hi-Tech Marketing. I don’t think it was even mentioned. So how is this a test of whether you own a business?
By the way, you only quoted 1 of the 7 criteria (one “extra” that I added to the article from a commenter who made a great point) and I think you failed miserable at that one. You seem to be far away from being able to claim that you really are a business owner.
By the author’s definition of business, no brokerage of any industry is actually a business. Mortgage brokers dont determine rates or products. Insurance agents dont either. No franchise is a business. Investment brokerages have no control products
Mortgage brokers definitely control their fee structure. Insurance agents get fees too. Investment brokerages control their fee structure as well. All of these provide a service which is definitely complex. Many MLMs selling vitamins, juices, etc. don’t provide a service that is substantially different than a Wal-Mart shelf. It’s not even close to a comparison.
I explicitly addressed why franchises are businesses in the article. You can search for the word “franchise” if you need more help with that.
Apparently, reading comprehension seems to be a challenge with your commentators. So, let me clarify a couple things for the lower life forms. I am an independent contractor, independent life insurance agent with only my name on the lease at my office. I have chosen to hold my licenses with Primerica and I have chosen to be exclusive with Primerica because of what Primerica stands for. Therefore, I am controlling what is sold in my office. If Primerica ends their war on cash value and becomes like every other financial company then I can choose who and what products I will sell out of my office that I’m on the lease for. Primerica is not on the lease.
Scott, “you had to resort to terrible language [lower life forms] which is automatically a sign of hiding the losing of a debate.”
You were claiming that MLM salespeople are independent contractors and anyone claiming otherwise were “idiots.” That seems to be unsettled legal ground and it actually seems more likely that they’d be considered employees if challenged in court. That’s my opinion based on the criteria though I am open for a debate on that subject. Declaring yourself an independent contract may be the right thing for you, but you are not here representing every MLM salesperson. You only present your own opinion and feelings about yourself and I haven’t seen you present a debate on the topic, “MLMs in general.”
So you moved on from “I pay the rent” to “with only my name on the lease at my office.” I fail to see how that addresses any of the issues I’ve raised about how irrelevant that is. In fact, they seem mostly synonymous to me. No one cares about the name of lease on your office. That means nothing in this discussion. You are attempting to create a strawman argument and prove yourself right.
I respect your choice to be exclusive with Primerica. However, that is not a sign of “independence.” That is a sign of dependence. If Primerica disappeared off the face of the earth tomorrow, would you still have all your direct clients? Could you just switch all those direct clients over to AllState and make the same amount of money?
If the answer is no, and I suspect it is, then can you just admit that you are “dependent” on Primerica?
It sounds to me like admit that you can’t determine pricing. You specifically say, “If Primerica ends their war on cash value…” Who cares, what Primerica does if you control pricing as you claim you did? You seem to admit that you are the marionette and you just choose to let Primerica controls the strings. That’s fine and I can respect that choice.
However, that’s very different from being Primerica itself that creates the insurance policies and pricing. Unless your lease is 1 Primerica Parkway. Duluth, GA 30099 (sorry, simple Google search), you don’t control the pricing of the products.
Again, if I’m wrong, sell me a million dollar whole life policy for $1 a month. Put your money where your mouth is. Show me that you control the pricing like you claim.
Scott said: “I have chosen to hold my licenses with Primerica and I have chosen to be exclusive with Primerica because of what Primerica stands for.”
I strongly suspect that you did not choose to be exclusive with Primerica but rather that you have no other options because no legitimate insurance company would ever consider employing you or having you serve as one of their agents. Hardly a choice. Merely accepting the default option. It’s like saying you chose to not play in the NBA and opted instead to shoot hoops at the schoolyard. Or more accurately, it’s like saying that you “chose” to be celibate when the simple truth is that no one wants to sleep with you.
BTW, it’s interesting how you have long made a point of insisting that you have “ownership” of your business; stated quite explicitly in comments like this for example:
Scott said: “I therefore own my own business.”
https://www.lazymanandmoney.com/why-mlm-is-not-a-business/comment-page-3/#comment-1409417
But in fact, your company’s manual (p. 25) refutes this in no uncertain terms:
“It is inaccurate to list yourself as ‘owner’ on social media.”
http://www.kandynasty.net/ACM/acm_workbook.pdf
You no more own a business than a busboy owns the restaurant at which he cleans tables (one notable difference being that every busboy in the U.S earns more than 99% of MLM distributors).
BTW Lazy Man, have a look at this training manual for new recruits, particularly the part about overcoming objections. Leaves no doubt about the scamminess and coercive nature of this sordid enterprise. I found the script for overcoming objection #2 (“It sounds like a pyramid…”) to be especially deceptive. The scripted response for Objection #2 was also appalling. I can just imagine some poor rube in the midst of a high-pressure sales pitch from an asshole like Scott saying:
“If a car was available for you right now and all you had to do was pay $99 for the title and you had to have the money by 8 p.m. tonight…could you find the money? So then money really isn’t the issue, is it? Let’s find that money and get you started so that $99 will never be an issue again!”
http://www.youngergeneration.net/NEW_REP_PAGE/New_Associate_Manual_10_2015.pdf
Then there’s this manual, which it makes it clear who the target market is for Primerica’s con artists: i.e., “family, friends, co-workers, church/neighbors.” http://unpub.wpb.tam.us.siteprotect.com/var/m_7/77/775/33626/347460-Fast%20Start%20Manual%20-%20January%202015.pdf
Both of these scripts make it obvious that the goal of the Primerica agent is to tee up suckers so that they can be pounced on by the upline. The distributor who is supposed to snare these victims is explicitly instructed to be vague and offer little to no explanation – blatant deception, as illustrated clearly in these two examples:
“Your job is to ‘invite’. Do not try to explain the business. Let us explain it. Giving information will not get people to the meeting. It will only lead to more questions. Never use the words, insurance, mortgages or investments…Once they commit to come, get off the phone so they don’t overwhelm you with questions.”
http://unpub.wpb.tam.us.siteprotect.com/var/m_7/77/775/33626/347460-Fast%20Start%20Manual%20-%20January%202015.pdf
“What is it about? — I’m still very new, that’s why my business partner/coach is coming with me. He/She will explain everything. (but what is it about?) To be honest, I’m still very new and I really do not want to give you the wrong information. (Just give me an idea of what it’s about) I am learning how to help people make and save money [Set the appointment].”
http://www.youngergeneration.net/NEW_REP_PAGE/New_Associate_Manual_10_2015.pdf
So, supermarkets aren’t real businesses because they don’t have full control over the pricing of their products. Because they don’t make their products? And, Prudential General agent’s don’t own a business because why?
Way back when, I challenged you based on who you decided had the best definition of a “business.” And, I said you don’t have the right to decide and neither does some intellect in some college have that right either. Unless, we live in a 3rd world dictatorship. You just proved my point.
Stop telling people how they can earn their money. Life is a risk. Sometimes earning money can be a risk. People have a right to choose to enter the sales arena whether it’s retail, wholesale, direct marketing, door-to-door, MLM. And, people have a right to open up businesses that may or may not make it long term. Whatever the market will bear should be the only consideration. Monivie didn’t make it because it could not compete with lower price products. Not because of how it paid its sales people. The market place will control business much better than government. Pricing too! I hope Trump has the opportunity to curtail the FTC and its Hitler style tactics.
Supermarkets control the pricing of their products. For example, you can see a detailed comparison of some here. If you think that Safeway or Aldi don’t have negotiating power on the price of products, you are fooling yourself. Costco and Walmart (while not pure supermarket, but act as one) are famous for telling makers of products the price points that they need to hit for the store.
So once again, you pick 1 of 3 points made in one of the 7 bullet points and tried to find an exception to discredit all the points. That’s not how it works.
Please explain how each and every point doesn’t work with MLMs in general (not your specific feelings about your specific MLM) and we’ll be moving in positive direction.
I never tell people how they can earn their money. I want to educate them that some ways such as blowing it on the lottery or getting involved in MLM doesn’t make much logical sense. Pretty much everyone, except for you, seems to understand that.
Ahh, the old “everything is a risk” gambit? Really? What are the risks that I’ll be hit on the head by anvil in the next 30 minutes while sitting on my couch? Are those the same as jumping out of an airplane without a parachute? Both are “risks”, right? A wise person calculates the risk. Since 99% of people lose money with MLM, it’s clearly not a wise risk.
MonaVie made a billion dollars and there were tons of lower priced products out there that predated it. It’s because the market could never support $45 juice unless it’s attached to a MLM “get rich” business plan. The FTC explained that BurnLounge was success at selling at inflated prices as long as there was a pyramid scheme business attached. Once the pyramid scheme was taken away, no one cared about the products. Same thing happened to Vemma.
The marketplace generally does a good job. However, when you attach a pitch to “own a ‘business'” to a product, people tend to buy the product as admission to that opportunity. If you want to test the marketplace, just take the pyramid scheme out of it and see whether it survives.
People can minimize the risk of any new business venture by first understanding that 99.7% of those joining an MLM actually lose money. The fact that 29,024 licensed reps left during the first 3 quarters of 2017 alone, plus the additional reps that left by year end only confirms that point.
Scott said: “So, supermarkets aren’t real businesses because they don’t have full control over the pricing of their products. Because they don’t make their products? And, Prudential General agent’s don’t own a business because why?”
Not sure what supermarkets and Prudential have to do with anything, but it’s clear that YOU don’t own a company — because Primerica specifically says that you don’t. Or did you miss that part of my previous post somehow?
Primerica Compliance Workbook: “It is inaccurate to list yourself as ‘owner’ on social media.”
http://www.kandynasty.net/ACM/acm_workbook.pdf
Scott said: “Stop telling people how they can earn their money. Life is a risk.”
No one on this thread is telling anyone how to earn money; we are telling people how to avoid not earning any money, like 99% of distributors, in the MLM business.
Scott said: “Sometimes earning money can be a risk.”
A simpleton’s truism. Obviously it’s the risk-reward ratio that really matters. MLM is all risk for an almost certain chance of zero reward. A bonehead’s gambit.
Scott said: “People have a right to choose to enter the sales arena whether it’s retail, wholesale, direct marketing, door-to-door, MLM.”
It’s not an issue of the right to choose to make a bad decision. Obviously everyone has that right, just like they have the right to shovel money into a fire pit and burn it or pierce their testicles; doesn’t mean it’s a prudent idea. What you’re really chafing about is that you think that you have an unassailable right to scam people – you don’t.
Scott said: “Monivie didn’t make it because it could not compete with lower price products. Not because of how it paid its sales people.
You know sweet F all about Monavie, so don’t pretend otherwise. Overpriced products are a direct result of the MLM model; there is no other way to pay out multiple levels of commissions to worthless boneheads like yourself without having that cost baked into the business model. It typically eats up half or more of an MLM company’s gross revenue. That’s why the products of virtually every MLM that has ever existed have been scandalously overpriced shite. The only exception is when they use the occasional loss leader.
Scott said: “The market place will control business much better than government. Pricing too! I hope Trump has the opportunity to curtail the FTC and its Hitler style tactics.”
First, there is no market for MLM products, which is why you have to create closed distribution loops selling them to enslaved distributors who in turn use high pressure coercion to foist them on their beleaguered friends and family members. If any MLM tried to compete in the open market with retail products, they wouldn’t last a month.
Secondly, Hitler style-tactics??? Like genocide? You stupid tone-deaf F-ing a-hole!!! It’s bad enough to have to read your incessant off-topic BS and victim role-playing every day, but to see you equate the FTC with Hitler is beyond the pale. For that, I will gladly devote an unlimited amount of energy to burying your shit-hole scam of a company. You have no idea!
Most grocery stores get their products by buying them first and reselling them at a higher price. Based on what they pay for rent, electricity, water, trash, payroll, taxes and other overhead, we get the retail price to buy their products. No different from one store to another. Competition drives the price and some win and some lose going out of business. It’s called Capitalism. It’s called risk in owning a business reguardless of the business and the method of marketing.
Retail hires employees and W-2’s them taking taxes and other government required payments out before the check is made. 1099 are paid to independent contractors, self employed before taxes.
I remember a guy moved from one city to another to be closer to his new job. One week later, he was laid off. All that money to move and the corporate nightmare hit him. I had a teaching job that was made clear to me I could be fired any time as it was a private school. I chose the risk. That guy chose the risk. There is no guarantee in life but death and taxes. Anyone who thinks they will earn money by osmosis in mlm’s shouldn’t complain when the do nothing to earn the money. There’s only one way to make money selling directly to people with no advertising, you have to open your mouth and talk to people. You have to know how many people you have to talk to to earn what you are looking for.
MLMs simply give you another way to earn more money. Recruit others and split the sales. But those recruits have to do the same thing and talk to people. MLMs get to grow their Agency downline while others don’t. Everyone starts at the bottom and based on their hard work can move up the ladder. I see no illegalities in that. I do see jealous people at the successful. But that’s true with successful people in corporations too. The Bible calls it coveting. I see that in here with you guys too. Same with university professors. You have to define “business” that makes you feel superior and in control. Fascist.
I’m pretty sure the big supermarkets have some negotiating power. For example, from The Consumerist, “The WSJ reports that by only offering one or two name brands of any select product, Aldi is able to negotiate lower prices with suppliers.”
So does every MLM get to negotiate with Primerica for rates? I hope you see the difference here. You are a salesman of their products and they dictate pricing for the most part (maybe you are allow to charge people more, but it’s unlikely you can directly negotiate prices with Primerica). With Aldi, there is a back and forth. They might go to Kellogg and Ralston and say, “Who wants the contract to be the Raisin Bran of Aldi?”
Even with this difference aside, Aldi, and all supermarkets, are allowed to market however they want. If they make a deal with Kellogg, Kellogg doesn’t get a say on how they run their stores. This discussion is so silly. And again, it’s just a fraction of one bullet point.
I noticed that you failed to step up to the challenge: Please explain how each and every point doesn’t work with MLMs in general (not your specific feelings about your specific MLM) and we’ll be moving in positive direction.
I remember a bunch of Vemma distributors who lost their business pretty much overnight when the corporate nightmare hit them. In almost every MLM I’ve seen, there is a clause where they can terminate your distributorship at their will. It’s the same as getting laid off.
Again, you talk about risk, but you fail to quantify it. For what it’s worth, I wasn’t hit on the head by an anvil while sitting on my couch. So I guess I won that risk.
No one thinks they’ll earn money by osmosis in MLMs unless someone recruiting them tells them that. Instead any legitimate MLM should have them sign a piece of paper with 30 point font that says, “I understand that 99 out of 100 people LOSE money in this. I am willing to take the risk that I might be the SINGLE PERSON to make money. I further understand that that the 1 person is actually the upline who have been at the company for years.” If your MLM hasn’t does this or something like it, you should ask why your MLM doesn’t want to inform people of the quality of risk involved.
It would be more accurate to say that MLMs simply give you another way to lose more money. Let’s try to be honest here. Also if the MLM is based on “Recruit others and split the sales. But those recruits have to do the same thing and talk to people.”, it is a pyramid scheme, right? We can at least agree on that ONE thing?
Remember that pyramid schemes focus on recruiting and you described someone “working hard” at recruiting others. While you don’t see any illegalities with that, I believe the law disagrees with you.
Why do you think Vemma got in trouble? Why do you think Fortune Hi-Tech Marketing was shut down? Why do you think Zeek Rewards was shut down?
The problem you seem to struggle with is that I choose to be exclusive to Primerica. I could be totally and independent agent and sell insurance for many companies but Primerica is different in many ways. Not just price what you seem to be fixated on. As I said, this is my business and I choose to work with Primerica. The greatest company in America.
And, you keep going back to MLM’s going out of business. So what? That’s capitalism which fascist socialists hate. So, how are they different from other corporations going out of business. If you can’t file bankruptcy and keep going then you close your doors and owners and managers close their doors and look for work elsewhere. That’s the risk of working and doing business. Don’t like it stay out of it but why attack it?
Your fight is unAmerican.
Vogel seems to think I don’t let people know what must take place for people to earn money with our company. It’s very simple:
1. Make a list of top 20
2. Ask them if they want to save money on car insurance.
3. Help them save money on car insurance and get paid for doing so.
4. When life licenses, go back and help them with life insurance. Set up 3 emergency contacts in case of death. Met with those EC and help them with their insurance. Keep doing this and you will make money. Don’t do this and you won’t make any money.
I help them where and when I can, train them and give them the tools to do the business. I’ll even go in appointments to help them out.
Ultimately, it’s up to them to:
1. Fill out their top 20
2. Learn scripts and presentations
3. Set appointments
4. Go on appointments
5. Close sale and get referrals.
Friends of mine with other companies were required to bring with them a book of business if 1,000 clients. We don’t don’t need to do that.
I explain what is necessary from them and what I will do. It’s up to them to follow through. I’m not going to badger them or force them. We aren’t set up that way. We don’t fire people. People just quit. Just like in every other company. You want turnover, try McDonalds…
Even with 29,000 leaving, we have more staying. The recruiting and licensing has grown. It’s all part of the business. I had an agent who earned $35,000 part-time decide to leave and be a mortgage broker. That was her choice. So, it’s not that people don’t earn money is always the reason for leaving. Some move away. Some get other time consuming jobs. Some want to spend more time with family and so on. It is what it is but our opportunity is the best! But, please, no fascists allowed ;-)
It’s a struggle to find anything relevant in Scott’s posts. It’s mostly all off-topic noise laced with the unsupported assertions and straight up BS. Case in point:
Scott said: “We don’t fire people. People just quit. Just like in every other company. You want turnover, try McDonalds…”
But “real” businesses do and must fire people. MLMs don’t because there is no such thing as insufficient performance or lack of qualifications, since the only qualifications that matter have nothing to do with skills but rather the mere ability to pay into the pyramid scheme. That’s one of the many ways that we know that MLM is BS. If they operated like real companies they would only hire people who have a high likelihood of succeeding at the job and they would quickly fire those that underperform. In MLM, your only job is to pay the company money; doesn’t matter how much; even the possibility of getting a dollar from a distributor is enough to keep them on the hook forever.
While MLMs never cut distributors loose (with the rare exception of cases of cross-line sales/recruiting for another MLM), distributors leave MLM in droves. From the numbers I’ve seen across the industry, the attrition rate is between upwards of 50% (conservative) and typically closer to 100% per year, which is appalling and without parallel.
http://scholarshub.net/ijcms/vol5/issue1/Paper_08.pdf
https://pyramidschemealert.org/study-of-ten-major-mlms-and-amwayquixtar/
http://money.cnn.com/2013/01/09/pf/multilevel-marketing-industry/index.html
https://www.huffingtonpost.com/steven-hassan/main-street-bubble-of-mul_b_816996.html
http://www.sequenceinc.com/fraudfiles/2011/05/calculating-loss-and-failure-rates-in-multi-level-marketing-schemes/
https://www.falseprofits.com/MLM%20Lies.html
This makes the “business” unsustainable and requires constant recruitment to replenish the dwindling distributor base. Distributors quit in droves because they realize that they were sold a false bill of goods by their recruiter; that the products are overpriced crap that’s next to impossible to sell; or that the MLM culture is filled with predatory schemers and insufferable lying assholes. It’s what happens when you deceive people in order to recruit them, as all MLMs do.
As for invoking McDonald’s, you can be sure of one thing. Every employee who has ever worked for them in their history as outlearned the average MLM distributor by at least 10-fold. So while you pretend that your shitty operation has some edge over McDonald’s the truth is that MLM distributors rank far below the lowliest fry cook at McDs. Not to mention that McDs offers an array of benefits and workplace protections that are completely absent from the MLM industry. A more valid comparison than McDs would be something like prostitution or drug dealing, which also have high attrition rates and questionable morality, like MLM, but far better pay. Or maybe garbage picking or panhandling, which aren’t immoral but pay about as well as an MLM, and probably better.
Scott said: “Even with 29,000 leaving, we have more staying.”
That’s a BS meaningless throwaway statement. Primerica doesn’t publish any data on distributor turnover rates, nor did you even bother to specify a timeframe or any specific numbers. Like I said, many sources have indicated that the annual attrition rate is close to 100%, and even at half that, it’s a freakin’ disaster.
Scott said: “I had an agent who earned $35,000 part-time decide to leave and be a mortgage broker.”
All of your arguments are predicated on BS that you make no attempt to backup. It’s always a case of “I know someone who…” with zero evidence. Why ever bother?
Scott said: “So, now you are judging me personally?”
I have been judging you personally for well over a year now. And why shouldn’t I? You’ve proven yourself to be a know-nothing ass who drowns the board in off-topic noise and couldn’t get a fact straight if your life depended on it. Lying predatory assholes deserve to be judged – harshly. That’s the badge of shame you wear as an MLMer. It’s part of the reason why the vast majority of people in this country, and around the world, despise MLM and MLMers. The reputation of your so-called “industry'” is so tainted that MLM companies don’t even want people to know that they are MLMs, and they invest considerable effort in disguising that fact, choosing instead to label themselves with deceptive decoy terms like “affiliate/network marketing,” direct sales”, etc. so that people won’t know the true nature of the business It speaks volumes.
Hell, your moronic scam of a company doesn’t even want potential recruits to know what the business is. Your distributor scripts coach them to be purposely deceptive and withhold even the most basic details. Case in point from your company’s coaching manual:
“Your job is to ‘invite’. Do not try to explain the business. Let us explain it. Giving information will not get people to the meeting. It will only lead to more questions. Never use the words, insurance, mortgages or investments…Once they commit to come, get off the phone so they don’t overwhelm you with questions.”
http://unpub.wpb.tam.us.siteprotect.com/var/m_7/77/775/33626/347460-Fast%20Start%20Manual%20-%20January%202015.pdf
You can be damn sure your want find any comparable fraud in the McD’s employee manual.
So, now you are judging me personally? You really are desperate aren’t you. Pathetic fascists jealous of other’s success and want to push the corporate nightmare on others.
I get solicitations from other companies in the mail daily to join their firms. Insurance and investment firms. Like I said before, you know nothing of our business that we get to define in this free country. Free from fascism.
It seems Vogel knew more about your business than you did as he specifically pointed out why you don’t own your business ACCORDING TO PRIMERICA itself. You don’t even agree with the company that you’ve tried to support so hard here.
Other MLMs didn’t “go” out of business because of lack of sales/profits. They were shut down by the law for being illegal pyramid schemes, but only after being investigated. Relatively few MLMs have been investigated, but EVERY one that has been investigated has been shut down, or fined heavily, or both.
Scott said: “Pathetic fascists jealous of other’s success and want to push the corporate nightmare on others.”
So many things wrong with that statement it’s hard to know where to begin. First of all, you don’t even know what the term fascist means and you display sociopathic stupidity every time you invoke it. Secondly, in no conceivable scenario would anyone envy an industry where a mere 1 out of 200 distributors breaks even. That’s just plainly stupid. Lastly, no one is pushing “the corporate nightmare” on anyone, and it’s ludicrous to call that a nightmare while simultaneously defending your own ridiculous industry, where practically everyone loses. It doesn’t matter whether someone chooses the corporate world or the non-corporate world; virtually any other option would be infinitely better than MLM.
Scott said: “I get solicitations from other companies in the mail daily to join their firms. Insurance and investment firms. Like I said before, you know nothing of our business that we get to define in this free country. Free from fascism.”
Again, your arguments always rest on statements that you pull out of your ass and make no attempt to prove with evidence. I can’t imagine anyone recruiting you for anything other than MLM scams, since you’ve already proven to the world that you’re a desperado and a sucker of the lowest order. And yes, we’re all happy that we live in a free country. It gives us the freedom to expose these BS MLM scams for what they really are.
You’ll never get it. I pay the lease at my office. I decide if I hang a Primerica sign or Farmers sign. I own my own business. I’ve chosen to hang the Primerica sign and be exclusive to them. I can close up my office and retire if I choose to and do whatever I want to do. If I meet Primerica’s terms I can sell the business to someone else or give it to one of my kids. If I meet certain business benchmarks I can also earn shares of stock in Primerica (PRI). So, guess what? I can be a part owner in Primerica.
Like I’ve said, you talk about MLMs in a broad general basis painting all under the same umbrella. That’s weak journalism and attacks some great MLMs while trying to destroy others. Take no prisoners attitude. Fascism.
Seems odd an MLM distributor would even need an office, but especially so for one without a physical product (insurance/investments). But then isn’t having a “storefront” office a corporate policy once you become an RVP. Hmmmm I thought you “owned” the business? And what business do you really own when, should you leave, you are contractually obligated from contacting any of your clients to follow you to your new company? And yes, you can sell your business if you meet Primerica’s terms but can only sell the business to another Primerican or family member IF PRIMERICA CORPORATE APPROVES THEM, meaning you can’t sell on the open market. Furthermore the criteria to qualify is so strict that fewer than 1/10th of 1% of all reps in their history ever qualified (and most of them qualified back in the 80’s/90’s).
Scott said: “You’ll never get it. I pay the lease at my office.”
Not that it matters a whit, but do you? Prove it. Otherwise F off.
Scott said: “I decide if I hang a Primerica sign or Farmers sign.”
Nope. You can only hang a Primerica sign because no legitimate company would ever consider doing business with a bottom-feeding MLM scammer; doesn’t make for an impressive resume.
Scott said: “I own my own business.”
For the third time, no you don’t; the company explicitly says you don’t. You can keep parroting the same lie over and over again but you just look stupid(er).
Primerica Compliance Workbook: “It is inaccurate to list yourself as ‘owner’ on social media.”
http://www.kandynasty.net/ACM/acm_workbook.pdf
Scott said: “I can close up my office and retire if I choose to and do whatever I want to do.”
So what you’re really saying is that you simply have a lease on some office space, allegedly, and you can choose to not continue to pay the lease. So what?
Scott said: “If I meet Primerica’s terms I can sell the business to someone else or give it to one of my kids.”
Might big “if”. You haven’t and you won’t. And what a shitty “gift” to give to a kid. An opportunity to enslave oneself in endless recruiting, necessitated because of insanely high attrition rates, for a 1 in 200 chance to not lose money. You must suck as bad as a parent as you do at everything else in life.
Scott said: “So, guess what? I can be a part owner in Primerica.”
So can any idiot. It’s a publically-traded company.
Scott said: “Fascism.”
Snore. Your stupidity is so tedious. You know nothing about fascism. It’s simply a word that you think you can use as a cudgel. Over the past couple of months you were calling everyone who you disagreed with a communist.
https://www.lazymanandmoney.com/why-mlm-is-not-a-business/comment-page-3/#comment-1344871
https://www.lazymanandmoney.com/why-mlm-is-not-a-business/comment-page-3/#comment-1396709
https://www.lazymanandmoney.com/why-mlm-is-not-a-business/comment-page-3/#comment-1396543
https://www.lazymanandmoney.com/why-mlm-is-not-a-business/comment-page-3/#comment-1365158
Now suddenly today it’s “fascist”. What will tomorrow bring? ISIS terrorist? Somali pirate? What you really mean is “I don’t like you”, so why not just say that instead of displaying such dazzling ignorance of sociopolitical terminology.
You so deserve your shitty lot in life as a penniless bottom-feeding MLM desperado.
Ever pay attention while driving and walking around where you live? Notice all the insurance offices? Notice all the real estate offices? Notice all of the investment offices? Why would you think it’s unusual for an insurance business to have a physical office? I guess you know very little about our industry and company. And, why should you be the decision maker on how we set up our business? Oh, that’s right. Fascism.
I’m glad one of you agree that MLMs that don’t self regulate in accordance with the law are fined and if needed, shut down. MonaVie couldn’t sustain itself. They priced themselves out of the business. Happens in all industries and not just MLMs.
How convenient of you to forget that in MLM, the “office” is usually the client’s home (or “kitchen table” as you call it, or in the case of WFG, “napkin presentation”), therefore the office serves no purpose other than records storage. Interestingly, most offices come complete with a stage mainly, devoted to selling the “opportunity”, rather than desks to sell the product. It gives corporate a free national footprint, paid for by the RVP force. Interestingly, in 2016, the average RVP office sold a total of 61 1/2 policies for the year, before terminations/lapses/cancellations. It seems obvious that having an office open for any more than a month is a waste. Excluding recruiting of course. I also noticed those other businesses you mentioned advertise regularly within their local markets, as well as nationally. I’ve yet to see a Primerica rep advertise their products. But it’s their own business…..right?
As for self-regulation, the industry has giant black eyes. And the DSA Board of Directors is comprised almost entirely with representatives from the various MLMs they’re supposedly overseeing…..including your own.
Earl, I prefer to meet with clients in their homes. But, when working with finances, clients sometime like to know I have a physical office and didn’t roll into town on the back of a pickup truck. Also, as a FINRA member, as a Brokerage, I have to have a physical office. This is partially why we are not a typical MLM and why you are wrong to lump us in as such.
That explains why most offices are located in run down strip malls or industrial areas nowhere near your clients houses or places of work. But of course you need an office to meet with clients. They’re lured in on opportunity nights and typically referred to as naive recruits, or fresh meat. A quick free FNA later and poof…..instant sale. Too bad they cancel when they leave tho. At least you were able to sell them a few dvds, Landmark Forum weekend training, seminar or conference first, and if you’re really on the ball. a convention ticket.
Near clients? You have no idea about the insurance industry or business. We don’t have limitations where we can prospect for business. So, regardless of where our office is, some clients will be close and others far away. Once again you show superior ignorance.
Since Scott can’t focus on MLMs in general and keeps pretending that Primerica is an exception to the rule, let’s recap a few key points about the company based on excerpts from their training materials and operations manuals and Scott’s moronic comments:
Deceptive High-Pressure Sales Tactics and Emphasis on Upfront Recruiting Fees
“If a car was available for you right now and all you had to do was pay $99 for the title and you had to have the money by 8 p.m. tonight…could you find the money? So then money really isn’t the issue, is it? Let’s find that money and get you started so that $99 will never be an issue again!”
http://www.youngergeneration.net/NEW_REP_PAGE/New_Associate_Manual_10_2015.pdf
Purposely Deceive the Customer About the Nature of the Business
“Your job is to ‘invite’. Do not try to explain the business. Let us explain it. Giving information will not get people to the meeting. It will only lead to more questions. Never use the words, insurance, mortgages or investments…Once they commit to come, get off the phone so they don’t overwhelm you with questions.”
http://unpub.wpb.tam.us.siteprotect.com/var/m_7/77/775/33626/347460-Fast%20Start%20Manual%20-%20January%202015.pdf
“What is it about? — I’m still very new, that’s why my business partner/coach is coming with me. He/She will explain everything. (but what is it about?) To be honest, I’m still very new and I really do not want to give you the wrong information. (Just give me an idea of what it’s about) I am learning how to help people make and save money [Set the appointment].”
http://www.youngergeneration.net/NEW_REP_PAGE/New_Associate_Manual_10_2015.pdf
Primerica Distributors Are Not Business Owners
“It is inaccurate to list yourself as ‘owner’ on social media.”
http://www.kandynasty.net/ACM/acm_workbook.pdf
Exploitation of Military Service Members
“YOU FOUGHT FOR FREEDOM, NOW LIVE IT. As part of the U.S. Armed Forces, you wanted to make a difference, be a leader and help protect freedom. Do you want to continue to make a difference? At Primerica, you could have a meaningful career by helping Main Street families get on track for a better financial future. We fight every day for financial freedom for Main Street America. Want to join our movement? We’re looking for leaders like you.”
http://www.primerica.com/public/primerica-veterans.html
Primerica Representative “Scott” Paradoxically Equates MLM Criticism With Both Communism and Fascism
https://www.lazymanandmoney.com/why-mlm-is-not-a-business/comment-page-3/#comment-1344871
https://www.lazymanandmoney.com/why-mlm-is-not-a-business/comment-page-3/#comment-1396709
https://www.lazymanandmoney.com/why-mlm-is-not-a-business/comment-page-3/#comment-1396543
https://www.lazymanandmoney.com/why-mlm-is-not-a-business/comment-page-3/#comment-1365158
https://www.lazymanandmoney.com/why-mlm-is-not-a-business/comment-page-4/#comment-1409513
@ Vogel “Primerica doesn’t publish any data on distributor turnover rates, nor did you even bother to specify a timeframe or any specific numbers.”
Actually, while they don’t specifically list that data as a line item, the turnover rates of reps, recruits and policy holders is readily available with some very basic math. As an example, an MLM ends 2015 with 125,000 reps. During 2016, they announce adding 30,000 newly licensed reps, yet report their force at year end to be 130,000 reps. Obviously, 25,000 licensed reps left during the year. The same can be deduced regarding recruits leaving, as well as policies cancelled. To be frank, I stopped counting after realizing that over 2 million reps and recruits had left the “opportunity” since 2009 alone. One can only imagine the total number since 1977 bearing in mind their force was twice as large in the earlier, glory years. That 29,024 figure was calculated based on their quarterly statements during 2017, with the final quarter’s figures yet to be announced. Based on the years since going public, it appears the churn of licensed reps during 2017 will the highest yet.
Vogel’s an idiot. As an RVP I have to have an office or rent in another Primerica office. In my case, I signed the lease. And, prove to me you have a human brain and not just a high level chimpanzee.
Why are you trying to be a knowledgeable butthead of Primerica. I have qualified to be the owner of my business where I can sell it. You can’t because you aren’t worth crap.
Scott said: “As an RVP I have to have an office or rent in another Primerica office. In my case, I signed the lease.”
How do you propose to prove that you’re an RVP and that you’ve signed a lease. Your claim carries no more weight than if I were to say that you’re running your shitty scam of a business out of your basement? Whether or not you signed a lease isn’t even relevant. Evidence talks; BS walks.
Scott said: “Why are you trying to be a knowledgeable butthead of Primerica.”
I am simply quoting from your own training and compliance manuals. It’s dishonest for you to suggest otherwise
Scott said: “I have qualified to be the owner of my business where I can sell it.”
You don’t own a business. Your company’s compliance manual spells that out in no uncertain terms:
Primerica Compliance Workbook: “It is inaccurate to list yourself as ‘owner’ on social media.”
http://www.kandynasty.net/ACM/acm_workbook.pdf
You don’t have anything to sell other than your position in the pyramid, which is essentially worthless given the well-known churn rates for MLMs, which are estimated at up to 100% per year.
http://scholarshub.net/ijcms/vol5/issue1/Paper_08.pdf
https://pyramidschemealert.org/study-of-ten-major-mlms-and-amwayquixtar/
https://www.huffingtonpost.com/steven-hassan/main-street-bubble-of-mul_b_816996.html
https://www.falseprofits.com/MLM%20Lies.html
“As an RVP I have to have an office or rent in another Primerica office.”
But it’s your business…..right? I guess having an office is critical so that those 62 new clients in 2016 had a place to sign their paperwork, and as well, the 41 clients who cancelled could also drop off their notices.
Vogel has developed a fascist website bent on destroying liberty and freedom and nationalizing business based on his own fascist brain. Assuming he has brains which it doesn’t seem so or maybe he’s had a severe brain injury. Probably at birth like Hitler did.
Wait, Vogel has developed a website? I admit that I haven’t been following this that closely, but I didn’t realize he was did that.
Scott said: “Vogel has developed a fascist website bent on destroying liberty and freedom and nationalizing business based on his own fascist brain. Assuming he has brains which it doesn’t seem so or maybe he’s had a severe brain injury. Probably at birth like Hitler did.”
I’d like to see Scott’s moronic comments accompany every Primerica sales pitch so that people will know what they’re dealing with.
Are we not past the point where Scott’s mic should be turned off, or at least moved to a page devoted to Primerica? Maybe title it “Scott: Primerica’s Badge of Shame”. I can understand fucking with him just for laughs, but the novelty wore off long ago.
Leave it here. Scott is doing a better job at shedding transparency on the true nature of MLM’s than we could ever do. While it’s pathetic, it is also quite entertaining and kind of like watching a car wreck.
Point taken. Game on then. Cheers!
EXPOSING PRIMERICA’S DECEPTIVE PRACTICES: PART 1
Here’s the behind the scenes playbook for Primerica’s atrocious scam compiled based on several training documents. Two of the sources were anonymous; others included RVP Jeff Seagrave (dba Legacy Builders), Jeff & Kelcey Fieldstad (Senior National Sales Directors); and Mark & Sue Younger Senior National Sales Directors (dba Younger Generation 2.0)
This wasn’t a deep dive either – just low-hanging fruit that came up on the first page or two of a Google search. I would imagine that much worse could be easily found, but the information that follows is damning enough.
1. DON’T TRY TO RECRUIT SMART PEOPLE/IGNORE EXPERTS
Claim: “Step No. 2. Recruit The Right People. Don’t Recruit…Smart People”
http://webcache.googleusercontent.com/search?q=cache:poyHQw2XlksJ:www.jefffieldstad.com/index.php/download_file/80/1+&cd=3&hl=en&ct=clnk&gl=us
Mind blown! Of all the stupid things I saw in the coaching materials for Primerica reps, this one took the cake. They explicitly said “don’t recruit smart people”. On the one hand, it’s kind of hysterically funny as well as plainly obvious – i.e., smart people are unlikely to fall for such a blatant scams), and on the other hand, deductive reasoning tells us that the real goal of Primerica reps is to sign up stupid people (e.g., Scott). Something I have been saying all along.
There’s also this doozy ordering prospects/recruits to not listen to experts or college professors (i.e., smart people):
Claim: “DON?T Listen to motivational speakers, trainers, experts, college professors, etc.”
http://webcache.googleusercontent.com/search?q=cache:poyHQw2XlksJ:www.jefffieldstad.com/index.php/download_file/80/1+&cd=3&hl=en&ct=clnk&gl=us
2. PURPOSELY DECEIVE PROSPECTS SO THAT THEY DON’T KNOW WHO THEY’RE DEALING WITH
Claim: “(Prospect asks) What is it? (Recruiter replies): I cannot explain it over the phone. I need to show you some information and I have someone I want you to meet”.
http://www.customacoustix.com/files/Prospecting_Guide_-_Scripts_and_Tips.pdf
Claim: “Helpful Hints – Your job is to “invite”. Do not try to explain the business. Let us explain it. Giving information will not get people to the meeting. It will only lead to more questions. Never use the words, insurance, mortgages or investments.”
http://unpub.wpb.tam.us.siteprotect.com/var/m_7/77/775/33626/347455-Appointment%20Setting%20Scripts.pdf
WTF? What kind of legitimate company would purposely avoid providing basic details about what the company does? Do you think you’d get a similar reply if you called State Farm to ask about what the company does? Hell no. Coaching reps to be vague and withhold details about Primerica is commonplace, as shown in my previous post:
https://www.lazymanandmoney.com/why-mlm-is-not-a-business/comment-page-3/#comment-1409470
3. LIE ABOUT REVENUE POTENTIAL
Claim: “(Recruiter says) Hey, this is xxx. If you knew of a way to make a lot of money, would you tell me about it?”
http://www.customacoustix.com/files/Prospecting_Guide_-_Scripts_and_Tips.pdf
A glaring misrepresentation given that the average annual revenue (before expenses) is $6,088 – less than half poverty level wage in the U.S. ($12,140). What the recruiter should say is “I have a business opportunity where you can earn 50% below poverty level.”
http://www.sequenceinc.com/fraudfiles/wp-content/uploads/2015/08/primerica2016.pdf
https://aspe.hhs.gov/poverty-guidelines
That’s not even the worst misrepresentation. This Primerica document lies by suggesting that reps will earn $1,000-$3,000 per month in only 6 weeks; $2,000-$5,000/month in 3 months; $3,000-$10,000/month in 6 months; and a million plus in 7 years.
http://www.legacybuildershc.com/uploads/1/3/7/5/13752487/fl_lavination_fast_start_plannerfinal_3.pdf
This document contains similar misrepresentations about revenue potential:
Claim: “(Recruiter says) Besides, why not have one job that pays more than both of your other part time jobs, or make another thousand or two thousand while you keep your full time job? I’m only talking about 8-10 hours a week, if that.”
http://www.legacybuildershc.com/uploads/1/3/7/5/13752487/fl_lavination_fast_start_plannerfinal_3.pdf
4. BE A DIVISIVE CREEP: CALL RELUCTANT PROSPECTS SISSIES AND COMMUNISTS; PRIMERICA CUSTOMERS, THE ONLY REAL AMERICANS
Claim: “Three types of people 1. Sissy-scared of everything…(NO CLOSE). 2. Communist- don’t think they will retire don’t want to protect family (NO CLOSE). 3. All-American — loves what we do for them and wants to help others as well (DEFINITE CLOSE).”
http://www.legacybuildershc.com/uploads/1/3/7/5/13752487/fl_lavination_fast_start_plannerfinal_3.pdf
This one blew my mind. It provides deep insight into the cult-like mentality and divisiveness at Primerica. It is also consistent with the way Scott has behaved here, first calling all Primerica critics communists and “whoosies” (sic), and then switching gears and calling them all fascists.
https://www.lazymanandmoney.com/why-mlm-is-not-a-business/comment-page-4/#comment-1409506
https://www.lazymanandmoney.com/why-mlm-is-not-a-business/comment-page-3/#comment-1396543
To be continued…
EXPOSING PRIMERICA’S DECEPTIVE PRACTICES: PART 2
5. FEIGN IGNORANCE ABOUT PYRAMID SCHEMES BUT DENY NONETHELESS
Claim: “(Prospect asks) Is this a pyramid scheme? (Recruiter replies) A pyramid? What’s that? (Wait for answer) No, that’s illegal. It’s a financial brokerage, just like any other business. So when do you want to come for an interview?”
http://www.legacybuildershc.com/uploads/1/3/7/5/13752487/fl_lavination_fast_start_plannerfinal_3.pdf
The contradiction here is glaring. How can a rep profess to not know what a pyramid scheme is (a lie at any rate) and in the same breath deny that Primerica is a pyramid scheme?
I also found this whopper:
Claim: “(Prospect asks) Is this Amway? Multi-level Marketing? A Pyramid? (Recruiter replies) Do you like (Amway, Multi-level, Pyramids)? (If the answer is no, recruiter replies) No? Great! Then you’ll love our company. We’re really nothing like them…(If the answer is yes, recruiter replies) Yes? Great! Then you’ll love our company. We have some things in common…”
So the gist here is that Primerica isn’t a pyramid scheme, unless the prospect likes pyramid schemes, in which case Primerica is a perfect fit. Primerica is also nothing at all like Amway, unless the prospect likes Amway, in which case the two companies are similar.
http://unpub.wpb.tam.us.siteprotect.com/var/m_7/77/775/33626/347455-Appointment%20Setting%20Scripts.pdf
Lastly, there was this:
Claim: “(Prospect asks) Is This A Pyramid? (Recruiter replies) Actually, Primerica has been in business since 1977. Do you think that I would be involved in something that wasn’t legitimate?”
http://unpub.wpb.tam.us.siteprotect.com/var/m_7/77/775/33626/347455-Appointment%20Setting%20Scripts.pdf
Um, yes. Yes, I do. Most certainly! Dodging someone’s direct question would tend to lead them to conclude that you would wholeheartedly embrace something that’s illegitimate.
6. FOCUS ON RECRUITING (FRIENDS AND FAMILY)/APPLY PRESSURE TO GET SIGNUP FEE
Claim: “PROSPECT BY “RECRUITING”!!! Recruit your Recruit’s “Best Friends”. FOCUS on recruiting.”
http://webcache.googleusercontent.com/search?q=cache:poyHQw2XlksJ:www.jefffieldstad.com/index.php/download_file/80/1+&cd=3&hl=en&ct=clnk&gl=us
One of the most obvious red flags with pyramid schemes, according to consumer watchdog groups and regulatory agencies, is an emphasis on recruiting versus sales to end users.
https://www.bbb.org/phoenix/news-events/consumer-tips/2015/03/opportunity-or-scam-multi-level-marketing-vs.-pyramid-schemes/
https://www.consumer.ftc.gov/blog/2014/05/telltale-signs-pyramid-scheme
The example above shows that in fact Primerica’s reps are coached to focus on recruiting. Worse still, they are routinely coached to focus on recruiting their friends and family. It seems that real focus of the recruitment pitch is to suck the $99 signup fee out of the prospect, as indicated by the following claim in the recruitment script:
Claim: “(Recruiter says) If a car was available for you right now and all you had to do was pay $99 for the title and you had to have the money by 8 p.m. tonight…could you find the money? So then money really isn’t the issue, is it? Let’s find that money and get you started so that $99 will never be an issue again!”
http://www.youngergeneration.net/NEW_REP_PAGE/New_Associate_Manual_10_2015.pdf
7. TELL THE PROSPECT THAT PRIMERICA IS EXPANDING IN THEIR AREA EVEN IF IT ISN’T
Claim: “(Prospect asks): What is it about? (Recruiter replies): I’m working for Primerica, a financial services company that’s expanding in the area.”
http://www.customacoustix.com/files/Prospecting_Guide_-_Scripts_and_Tips.pdf
8. CREATE FINANCIAL PROBLEMS BUT DECEPTIVELY CALL THEM SOLUTIONS
Claim: “(Prospect asks) Give me more information. (Recruiter replies) The company provides solutions to people’s financial problems. And everyone has financial problems today, don’t they? They help families in many different ways — too many to get into right now”.
http://www.customacoustix.com/files/Prospecting_Guide_-_Scripts_and_Tips.pdf
Well, no, not everybody has financial problems today, and if anything Americans today have fewer problems (e.g., low unemployment rate and robust stock market). Secondly, Primerica doesn’t solve financial problems; they create them. The average annual revenue for Primerica representatives is $6,088.
http://www.sequenceinc.com/fraudfiles/wp-content/uploads/2015/08/primerica2016.pdf
That’s half the individual poverty level revenue of $12,140.
https://aspe.hhs.gov/poverty-guidelines
9. MISREPRESENT PRIMERICA AS FINANCIAL EDUCATION COMPANY
Claim: “(Recruiter says) Well I just started with a financial education company and I am in training. For my training I have to observe some training appointments in the field so I know what to do. I’ll come by with my trainer and show you the presentation and all you have to do is ask a bunch of questions and I’ll see how it’s done by watching my trainer answer them. It’s going to be great! You’re going to help me right?”
Claim: “(Recruiter says) Well look, the reason I’m calling is because I just started working with a financial education company part-time and they’re looking for some sharp, motivated people that want to make $2000-$3000 a month two nights a week and you’re the first person I thought of. Is that something you’d be interested in? I can put in a good word for you and try to get you an interview.”
http://www.legacybuildershc.com/uploads/1/3/7/5/13752487/fl_lavination_fast_start_plannerfinal_3.pdf
Ignoring for the moment the egregious lie about earning $2,000-$3,000 a month, the simple fact here is that the claim that Primerica is a “a financial education company” is a straight up lie. This is what Primerica really is according to the documents they filed with SEC:
“Primerica, Inc. is a leading distributor of financial products to middle income households in the United States and Canada with approximately 98,000 licensed sales representatives at December 31, 2014.”
https://www.sec.gov/Archives/edgar/data/1475922/000156459015001024/pri-10k_20141231.htm
This is just one of the many ways that reps are encouraged to deceive customers about the true nature of the business. They are coached to be purposely vague and withhold details from prospects, as discussed previously.
https://www.lazymanandmoney.com/why-mlm-is-not-a-business/comment-page-3/#comment-1409470
10. LIE ABOUT WHO DOES/DOES NOT WORK FOR PRIMERICA
Claim: “(Prospect asks) My friend already tried that. (Recruiter replies) Oh, for real? Who was it? (Wait for answer) Oh, I don’t think he works here anymore. But I mean are you going to judge your success off of someone else’s failure? That’s like not going to college just because your friend dropped out ha-ha.”
Very transparent deception here. If a prospect mentions some friend who “tried” Primerica (and presumably had a bad experience), the rep is coached to blindly say that the friend in question left the company (without even knowing the friends identity) and to call the friend a “failure”.
11. LIE ABOUT AFFILIATION WITH CITIGROUP
Claim: “(Recruiter says) We deal in a broad range of financial services, we are the marketing division for CitiGroup, I don’t have a lot of time right now, but gimmie your name and number i’ll get you some information.”
http://www.customacoustix.com/files/Prospecting_Guide_-_Scripts_and_Tips.pdf
In fact, Primerica was never the marketing division of CitiGroup. It was once a subsidiary owned by CitiGroup but the company divested the last of its ownership stake in 2011.
https://www.businesswire.com/news/home/20111219006003/en/Primerica-Announces-%E2%80%9CRefounding%E2%80%9D-IPO-Process-Complete
ADDENDUM
SALES FORCE NON-PRODUCTIVITY
According to this Primerica website, in 2014 they paid “a total of $593,056,197 in compensation to its sales force, at an average of $6,030 per life licensed representative”.
http://www.youngergeneration.net/ABOUT-THE-YOUNGER-GENERATION.html
Using simple arithmetic, we know that this translates to a total of 98,351 agents. The company generated $1.52 B in revenue for 2016, which works out to $15,455 per agent. In contrast State Farm has 19,000 agents and generated $76.1 B in revenue for 2016 – an average of roughly $4M in revenue per agent. In other words, State Farm generates 50 times more revenue with one-fifth as many reps. A 250-fold productivity ratio.
https://www.prnewswire.com/news-releases/state-farm-announces-2016-financial-results-300414584.html
https://www.statefarm.com/about-us/company-overview/company-profile/fast-facts
https://amigobulls.com/stocks/PRI/income-statement/annual
This article paints a similar picture of inefficiency/pitifully low productivity across the MLM industry:
“Here is an industry that, according to industry data, engages with approximately eight percent of the U.S. adult population each year, yet generates less than one percent of total U.S. retail sales. Subtract the products that MLM distributors buy for their own use and keep buying to remain “eligible” to earn income and you get the idea of just how small MLM sales are to consumers who are not also MLM distributors. Factor in the churn of the distributor base and ongoing recruitment becomes a major source of income for distributors and to sustain the overall business model.” http://thehill.com/blogs/pundits-blog/economy-budget/342526-why-multi-level-marketing-companies-fear-an-honest
MINISCULE SALARIES VS. NON-MLM
The average Primerica rep made $6,088 according the most recent Earnings Claim Disclosure. The typical salary for State Farm agent is $47,592 – 8-times higher. It’s also not unlikely that Primerica’s estimates are exaggerated.
http://www.sequenceinc.com/fraudfiles/wp-content/uploads/2015/08/primerica2016.pdf https://www.glassdoor.com/Salary/State-Farm-Insurance-Agent-Salaries-E2990_D_KO11,26.htm
APPENDIX
PRIMERICA IS POORLY RATED (2/5 STARS) WITH CONSUMER AFFAIRS
Primerica’s 2-star rating must be a source of great embarrassment. They should be thankful – it’s 2 stars more than they deserve. The critiques of the company in the comment section are similarly brutal. Also worth checking out this story from a Primerica RVP in the Shane Rudman organization – again, brutal.
https://www.consumeraffairs.com/employment/primerica.html
https://primerica.pissedconsumer.com/former-successful-primerica-regional-vice-president-tells-it-like-it-is-20080411117795.html
ADDITIONAL READING
ALONZO REFERRALS & PROSPECTING 101
Source: Daniel & Karma Alonzo, Primerica National Sales Directors
http://www.building-leaders.com/2009%2002%20Alonzo%20Referrals%20&%20Prospecting%20101.pdf
A how-to guide on deceptively befriending people so that you can sell them out to Primerica.
RECRUITING CONNECTIONS
Source: Primerica, Inc./Nick B. Thomas, Primerica Senior Regional Leader
http://nickbthomas.com/download/Recruiting_Connections.pdf
The title tells gives you an idea of what to expect – RECRUTING! – but nothing can prepare you for the onslaught of brainwashing in this mind-numbing 100-page tome paean to pyramid scheme recruitment, in which the word “recruit”, or some variant thereof, appears a total of 419 times. After seeing this, it’s hard to imagine how Primerica could deny to the FTC that they are focusing on recruitment over sales (i.e., hallmark #1 of an illegal pyramid scheme).
TEAM MVP FAST START PLANNER
Source: Jaime R Quintanilla, Primerica Senior VP; Gerardo Castellanos Jr., Regional VP
https://www.teammvp1.net/uploads/8/0/5/7/80573138/updated_fsp.pdf
Most revealing statement: “The Key To Your Success: RECRUIT! RECRUIT! RECRUIT!” Also features high-dose brainwashing with instructions on not listening to anything “negative” (i.e., critical of Primerica) and links to a couple of dozen moronic motivational audio recordings, which is an affront since reps are fed a steady diet of the crap in lieu of skills training that might actually be useful. It’s time-sucking mind-numbing pabulum. To add insult to injury, there’s the 8 Weekly Training phone-in calls per week – a gob smacking 14.5 hours’ worth. The document also contains the obligatory misleading earnings representation.
One of the unintentional knee-slappers was the prospecting script, which advised reps when asked “what is the name of the company?” to respond by saying “We’re PFS Inc., we’re publicly traded on the New York Stock Exchange, and our stock symbol is PRI”. The company that operates under the symbol is Primerica, Inc., but apparently admitting that is a bad thing. Not hard to see why.
Another doozy was the suggested response to this question:
Q: “Do you need any experience, degree, or a certain background? (99% of people will say “no”)”
A: “No? Great! We prefer to train people with no experience in order to maintain our high standards.”
How do no experience and high standards go together? They don’t obviously. In fact, we know that they have no standards whatsoever – they would recruit roadkill if it could sign a check. We also know that they purposely steer away from trying to recruit “smart people”. Plus, we’ve already had a revealing glimpse into what passes for “training” in the organization (i.e., how to recruit and trite motivational fluff to discourage quitting the pyramid). It’s all bad news for Primerica customers (i.e., victims).
Lastly, you have to marvel at the suggested deflection in response to the question of how much the company pays and whether it’s hourly, salary, or commission: “We’ll discuss compensation in great detail during our interview.”
CORRECTION
The document attributed above to Legacy Builders and Jeff Seagrave in fact lists Jon Lavin (Regional VP/Senior National Sales Director) and Team Lavination as the source. The Legacy Builders website hosting the document is run by Bobby Gocool (Senior National Sales Director).
I saw nothing about consumer affairs. Another bogus childish rant from a weak website no one pays attention to.
Minor note on Consumer Affairs… they are a scummy organization. That doesn’t mean that the reviews aren’t particularly earned, but if a company has a bad reputation they can pay to be in their Consumer Affairs for Brands program and “increase their star rating” among other things.
Here’s what Truth in Advertising says about Consumer Affairs:
https://www.truthinadvertising.org/consumer-affairs-com/
I didn’t want to side-track us even more from our current off-track Primerica time waster, but it seems that horse has been beaten to death for months or maybe a year or two now.
Thanks for the heads-up Lazy Man. Sounds similar to the how it was with the BBB recently, where a good rating didn’t mean anything but a bad rating was still well earned.
I read some of the consumer affairs. The comments on them were more buzzard than the comments you chimpanzees make. Absolutely stupid moronic comments. One guy complained he had to pay more than one month for his life insurance. The other complaints were all on that level. Other complaints were the typical competition posing as Primerica recruits or agents. Just a bunch of liars Like is in here. Bye.
Of course you’d say that. We’ve seen the evidence of how you dolts are brainwashed to deny and cower from all forms of “negativity” (i.e., well-deserved and well-researched criticism) and how incredibly F-ing bad you all are when it comes to skills training and especially customer service. Get a complaint, call the person a liar, a chimpanzee, a a “failure”, or your favorite “communist/fascist/whoosie (sic)”. It’s what you’re trained to do. We’ve seen the evidence. Lies and deception are the DNA of your scammy BS operation. Watching you try to defend it (or more accurately, deflect) is classic tragicomedy.
Ya Volger, it’s like the Democrats. They hate the FBI when they hurt Hillary but love them trying to hurt Trump. They are hypocrites, the BBB and Consumer Affairs are hypocrites and everyone on this site are hypocrites except for me. I’m the only sane intelligent one here.
No, in reality it’s nothing at all like that. You’re simply projecting, and you;re using this bizarre analogy to jam a square peg into a round hole.
Arguing that everyone around you is crazy and that you’re the only one who;s sane is classic paranoia — a hallmark symptom of schizophrenia.
The fact speak loudly and unequivocally. You’ve run out of rope . Nowhere left to hide.
Hey Vogel, maybe Scott can use his mathematical finance skills to summarize the following. During 2017, the following figures were provided during their quarterly announcements;
– began the year with 116,827 licensed reps
– End of first quarter, announced adding 10,903 newly licensed reps
– End of second quarter, announced adding 12,947 newly licensed reps
– End of third quarter, announced adding 12,783 newly licensed reps
– End of fourth quarter, announced adding 11,902 newly licensed reps
– ended the year with a total of 126,121 licensed reps
At that rate we will have 300,000 licenses reps in 10 years! Awesome! Ready to dominate the industry! Thanks! I’ll use this with training today!
Scott said: “At that rate we will have 300,000 licenses reps in 10 years! Awesome! Ready to dominate the industry! Thanks! I’ll use this with training today!”
Wow! You either really terrible at math or you make no attempt to use it and simply fill in numbers in your head at random. The company had to sign-up 48,535 new agents over the course of a year to get a net gain of 9,294 agents. The company currently has 126,121 agents. At the current rate, it would take more than 18 years to get to 300K (after chewing through 908,029 agents) , and there’s every reason to think that even the current rate is unsustainable. Awesome indeed. Flipping idiot! You obviously won’t be using that in training EVER.
That’s asking a bit much of Scott. It would require both arithmetic skills and honesty, and he’s sorely lacking in both.
The numbers you provided work out to a 33% annual attrition rate. That means, best case scenario, complete turnover of their agents every 3 years. Abyssal! Endless recruiting to feed a pyramid that nets nothing for more roughly 99% of participants.
I wouldn’t worry about my math. Your assumptive reasoning is quite atrocious. Assuming a uniform rate is the same mistake evolutionary science makes too. The attrition rate is high in the Insurance industry across the board. It’s not for everyone. But, for many, such as yourselves, logic and reasoning aren’t for you either.
I did appreciate the numbers as I shared them with the training group today. It went well! Proves my system will correct this and increase the numbers more. I think as a company we could get to 300,000 in 5 years instead of 10 years.
Scott said: “I wouldn’t worry about my math.”
I’m not worried per se but it’s worth pointing out that you’ve shown to no inclination to utilize math and no ability whatsoever to understand it when it’s presented to you.
Scott said: “Your assumptive reasoning is quite atrocious. Assuming a uniform rate is the same mistake evolutionary science makes too.”
More meaningless word salad. What is your basis for impugning my “assumptive reasoning”? It’s also not the least bit surprising what someone with your obviously stunted intellectual abilities would throw in an off-topic attack on evolutionary science (just to be a complete ass). What’s next? Everyone knows the earth is flat?
Scott said: “The attrition rate is high in the Insurance industry across the board.”
Really? For once would you care to back up your flimsy assertions with some evidence, the way Lazy Man, Earl, and I do? I guarantee that turnover in the insurance industry is nowhere near that of your shitty joke of a company.
Scott said: “It’s not for everyone.”
Of course not. It’s for dolts, desperados, and con artists. I’ve been saying that all along.
Scott said: “I did appreciate the numbers as I shared them with the training group today. It went well! Proves my system will correct this and increase the numbers more.”
How is that possible? If you presented those abysmal attrition rates and it went “well”, then it proves my point about your target audience consisting of simpletons. But the truth, obvious to all, is that you did not present these numbers to anyone. Why would you? They are a humiliating badge of shame.
Scott said: “I think as a company we could get to 300,000 in 5 years instead of 10 years.”
If that is what you think after being shown the attrition rates, and the fact that your net signup rates have languished for years, then you’re painfully incompetent. The company had to sign-48,535 new agents over the course of a year to get a net gain of 9,294 agents. The company currently has 126,121 agents. At the current rate, it would take the company more than 18 years to get to 300K (while chewing through 908,029 agents), and there’s every reason to think that even the current rate is unsustainable. Tell us again about how we shouldn’t be worried about your math? You can’t even freakin’ add or multiply!
Interesting thought Scott, but time is proving you wrong. In 1988, your force was almost double its current size.
As for comparing attrition rates, your President, in his letter to the FTC regarding the Business Opportunity Rules compared your opportunity with part-time supermarket employees, part-time baggage screeners and part-time UPS workers. (https://www.ftc.gov/system/files/documents/public_comments/2006/07/522418-11929.pdf)
As for growing your force to 300,000, lets bear in mind that between 2009 and 2017, your force grew from 99,785 reps to 126,121 reps. However that growth required churning through over 2 million recruits and reps. To gain the additional 170,000 reps you’re suggesting would require recruiting over 13,000,000 people, and if over a 5 year period, represents about a 10x increase in recruiting efforts annually, in an ever shrinking pool of people who haven’t already been duped (or know of someone), or have not read the exponentially increasing poor reputation MLM’s have on the internet. You are breathing rarefied air if you expect people to believe your absolute nonsense.
Just more inability to do simple math. About 20,000 new agents. Even if it was 10,000, what other insurance company do you know grew like that? Our life insurance in force took a big jump! Securities is up $10 billion asset sales under management! Fantastic! We are already announcing 2019 bi-annual Convention! We are awesome and Lazy Man is puny like their man parts ?
Scott? 126,121 licensed reps-116,827 licensed reps= 20,000 licensed reps??? Seriously?? Please tell us you don’t actually handle investments?
As for policies in force growth, lets wait for the 2017 earnings call. I guarantee you that any growth in policies works out to considerably less than 1 policy per rep, mainly due to chargebacks as reps and recruits cancel the policy they were sold when they joined earlier in the year. Perhaps you are referring to face value in force? Since most life insurance is based on a person’s annual income, growth in face value is merely a function of increased annual earnings at their yucky J-O-B-S. The more their jobs pay them, the higher the face value needed. Those higher J-O-B earnings only serve to confirm that MLM opportunities become an even less viable alternative year after year.
Whoa, how did the size of my man parts become part of this discussion? How is Primerica allowing you to be a rep with comments like this?
Scott, thats strike two! Ok, one more try please. You had 116,827 reps at the start of 2017, and ended the year with 126,121 licensed reps (after adding 48,535 new agents during the course of the year). So, one last try…….how many did you grow by……..and how many left?
And please, never compare MLM with franchising. If you had to follow the same rules, nobody would join at all.
19,294, excuse me for approximating to get to the point we will have 300,000 agents in 10 years. How many will you have for your ridiculous company?
I gave you the current in force coverage as of December 31, 2017. So, you have the correct numbers. Everything is great here in Primerica! The greatest company of all time! We changed the social and economical outlook of the country starting February 10th, 1977! Very few mutual funds at that time and cash value dominated the market. We got the word out to the public with our field force through the years. Especially the first 12 years with Art Williams. At one point 220,000 licensed reps. It was much easier to get licensed back then. Now most people know about mutual funds with thousands of funds in the market. Term is much more known and that is growing even though the industry giants hate us and despise us. We changed the industry for the better. Not you. We love it!!!
I’m still waiting for you to comment on how my man parts became part of a discussion that I wasn’t participating in.
How many distributors did MonaVie or Vemma have 5 years ago? How many do they have now?
Oh and you are complaining after your volger childish comments. Hey, if the shoe fits wear it. Let’s face it, I have no problem with the type of business models you believe are best. I also believe that as long as the opportunity exists and not over hyped then there is nothing wrong with MLMs, franchising or any other business model. But you are communists and that is that. You hate capitalism. Admit it.
I’m not sure “volger” is a word. Maybe you mean Vogel, but if so, he certainly isn’t “mine” any more than you are “mine.” And I’m certainly sure we shouldn’t talk about owning people altogether, unless that’s something you want to promote as a Primerica representative.
I love capitalism. I have a whole website with around 2500 articles on the topic. You are reading it right now.
Scott said: “Oh and you are complaining after your volger childish comments.”
You mean “vulgar”? Damn man, you weren’t even close. Ouch! That’s scary illiteracy. People might feel sorry for you if you weren’t such an asshole. You should give being less of an asshole a try.
Lazy Man wasn’t complaining, although it wouldn’t be unreasonable if he had, given that he’s the blog host and you made an unprovoked infantile comment about him having “puny man parts”. Still, you have the gall to call him childish? Amazing!
https://www.lazymanandmoney.com/why-mlm-is-not-a-business/comment-page-4/#comment-1410507
Scott said: “I have no problem with the type of business models you believe are best.”
Well, clearly you do because the business models we all believe are best are those that are non-MLM business models. You seem to be missing the point, once again.
Scott said: “I also believe that as long as the opportunity exists and not over hyped then there is nothing wrong with MLMs…”
Overhyped? You mean like today when you called Primerica “The greatest company of all time!”
Watching you try to think is just too painful. I can practically hear the rusty gears grinding and the cogs flying off.
https://www.lazymanandmoney.com/why-mlm-is-not-a-business/comment-page-4/#comment-1410549
Scott said: “But you are communists and that is that. You hate capitalism. Admit it.”
We’ve been through this before cranky fool. Up your meds!
https://www.lazymanandmoney.com/why-mlm-is-not-a-business/comment-page-4/#comment-1409506
The discussion here is not about capitalism. The topic is MLM, and you’re dodging. The truth is that pretty much everyone hates MLM (so much so that MLMs don’t want to be called MLMs because of the negative perceptions) — and for good reason (99%+ failure rates for instance). You can’t elude that fact by calling the majority of the population communists, fascists, or any other name.
BTW, you must surely be aware that MLM scams are antithetical to free-market economics. They are intentionally-designed as closed insulated economies, preying on their recruits to keep the pyramid schemes afloat. MLMs purposely avoid trying to compete in the open market because the products are horrendously overpriced by design and the level of service they offer is absolute laughable shit. You are a hallmark example of the type of customer service one can expect from an MLM. I’ve never met anyone remotely as noxious and dumb at any of the financial institutions I have ever dealt with. An employee like that would be poison for any company other than a shitty MLM, which will happily take money from anyone, including (or predominantly) human detritus, to feed the pyramid.
We don’t have distributors. We have state and federal licensed agents with their own personal licenses they can hang with any company. Even though Primerica paid for their licenses.
Why are you so hung up on your man parts? Need a good psychiatrist?
Well it surely is embarrassing that Primerica has a “Distributor Development” page: http://primerica.com/public/news/distributor-development.html. What else would you like to lie about?
I just want to make sure you are okay with me publicly saying that you, including your full name, is a Primerica representative that believes insulting man parts is a great way to represent the company. I certainly hope you aren’t high up, because that would be pretty embarrassing, right?
Excellent! We grew while other companies all lost agents! We have the right way then. So, in 10 years we will have 220,000 more than you ;-)
Can’t help it if people join and then don’t get appointments to earn more money. People get distracted and lazy like you. So what?
LOL!!! Volger errr Vogal, get it? No sense of humor. See, that’s what happens when you spend every second of the day trashing people and businesses. You become like a Democrat socialist unhappy and hating the world. It’s so much better here on the light side of Network marketing. We are happy and loving our time here on earth.
(Scott) “We are happy and loving our time here on earth.”
Who’s happy Scott? Not the 39,241 reps who left in 2017. Nor the 34,607 reps who left in 2016, or the 31,280 who left in 2015 (who weren’t much happier than the 31,031 who left in 2014) or the 30,962 who left in 2013…….. And it wasn’t just reps who left. They were joined by close to 1 million recruits. I won’t even mention the approx 1 million policies that also left during that same period (tho reps and recruits leaving represent a large chunk of them as well).
In the words of your illustrious corporate president, in his written address to the FTC regarding the Business Opportunity Rule “In short, Primerica is not “selling” a business opportunity in any meaningful sense.”
No truer words have ever been spoken!
LazyMan pretty much hit these on the money. Allow me to add a couple more salient facts about MLM’s that should also impact decisions.
First, most of the customers for MLM products are the “distributors” (or whatever they are called) themselves. Why? Because the products are very high priced. Then why don’t they lower prices? Because the Multilevel bonus promise requires a lot of cash – I recall Amway reserving some 70% of “BV” (wholesale) for bonuses. That is one hard expense to offset — so you leave the price high, and remind your Distributors to buy their own products.
Second, the presentation of the successful leaders is a great attraction to any confident person – if THEY can make a million, I certainly can! However, you can’t, unless you already have a downline of distributors, or can build one real quick. Some people have positions of authority (ministers, club leaders), or a mesmerizing style, and they might. But not often, when faced with the natural skepticism of many Americans.
Third, quite a bit of money flows outside of the advertised products – in motivational materials. If you think 5% back on business is good, look at the markup on a cassette tape or a video or a book of your lectures. Pennies to produce, and offered to YOU, the Distributor, at a mere $5. Lots of nice profit there for the motivational Upline leaders, with a captive, obedient market. And the Distributors will be encouraged (!) to buy more motivation, to motivate their success.
My conclusion is that MLM’s are not guaranteed to flop, but only guaranteed to be a loss for all but the highest level of distributors. And the products, although sometimes unique, have rarely been even superior, but always high-priced, often obviously over-priced. And YOU, the struggling distributor, should look past the claim that “you need to work harder”; we all can work harder, but true entrepreneurship and success also involve discretion and analysis of the opportunity – and saying no to bad ones. Which may simply mean saying no to some very opinionated people. Who are also looking to have you in their downline, upon which to stand.
Well put. I’ve looked into the SEC filings for several publicly-traded MLMs (most are private companies so their finances are opaque) and in every case, distributor payouts ate up more than 50% of gross revenue. That means that the products have to be scandalously overpriced, and that is baked into the MLM business model by design. I am yet to see an example of an MLM with products that didn’t sell for 5 to 30 times more than their retail counterparts and/or weren’t grossly inferior.
So how do MLM companies and distributors deal with that fact when facing their “customers”? They simply lie about the quality of the products and what they can do. With beauty products for example, they lie about the source and quality of ingredients (e.g., “our products are made in top labs in Europe and feature only the finest premium ingredients” – all BS) and what they can do (e.g., “our face cream is better than Botox and a face lift combined” – more BS). But more terrifying are the companies that sell health-related (i.e., snake-oil) products, which they promote, illegally, under the guise that they can cure a myriad of diseases. They go as far as to dissuade people from spending money on doctors and legit medicine in lieu of these blatantly bogus nostrums. The ultimate goal of course is simply to rope people into the pyramid scheme. It’s a sick, twisted, parasitic “industry” in which all but a minute percentage of participants are doomed to lose money.
Any company that interchanges products and services with money is a business. Some are non-profit and some are for profit businesses.
Some Socialists hate large corporations and seek to control them by governments. Large corporations general don’t care about small businesses. Communists hate anything resembling capitalism. They bitch and complain about business models they don’t like. Much like Baptists complain about Catholics or Mormons.
Then, there is the price issue. Sizzler sells a steak at $20 while Ruth Cris sells the steak at $80. It goes to the same place and out the same exit. But, only poor coveting people complain about the cost difference. Ruth Cris claims their steaks are fed differently and say that’s the cost difference. Who knows really? The fact is, they are able to attract the more rich persons than Sizzler. Do they tell the truth? Who knows?
As far as some MLM distributors saying how their products cure cancer and diabetes, unless customers complain, it’s hard to monitor all the distributors. To outlaw the entire business is communism. So, come up with a way to monitor and regulate that doesn’t jack up costs even more. Then, you can legitimately comment.
So by Scott’s definition of “business” running Vemma’s or BurnLoungue’s proven pyramid schemes still counted and running a business. If you want to go by that flawed definition and find yourself in legal trouble and your assets (pyramid of recruited people) eliminated, then at least you should have to sign a waiver that you know you are signing up for that.
I don’t know what point you were trying to make about socialists, communists, capitalism, large businesses, or small businesses, but it had nothing to do with the topic MLM.
Your Sizzler steak vs. Ruth’s Chris steak analogy is like a Yugo vs. Ferrari analogy (exaggerated brands for effect). Scott might say that they get you to the same place just like he suggested that steaks go in the same place and out the same exit. So who knows really if a Yugo is different than a Ferrari is what Scott would say. Well, millions of consumers have tried Sizzler and Ruth’s Chris steaks and are willing to pay the difference. The same with cars.
However, this doesn’t apply in the MLM world. Consumers aren’t the ones buying the products because they like it. If they did, Vemma would still be doing a great business. The FTC wouldn’t have made an example that Burnlouge’s sales went to practically nothing without the MLM.
People were clearly buying the products because it was a required admissions ticket to try to make big money.
This has been explained to Scott over and over again, but he doesn’t get it.
It’s really not too hard to monitor all distributors. Here’s one way to start… put the products in Wal-Mart or other retail locations. No one is going around saying that Centrum will cure your cancer.
Here’s another way to monitor distributors. Simply set up a whistleblower program where if anyone finds any claims the company will pay out $5,000 per incident. Have distributors sign a liability form where they’ll have to pay it back (it could even be held in escrow to start).
Suddenly we’ll have created a real BUSINESS where people can make money providing the SERVICE of solving the problem.
I would make a million in less than a year and many consumer dangers would be eliminated.
Scott said: “Communists hate anything resembling capitalism. They bitch and complain about business models they don’t like.”
What a bunch of twaddle! Like a simpleton, you use the word “communism” as a synonym for “something I don’t like,” without having the foggiest notion of what it actually means. Framing your hollow defense of MLM as an issue of capitalism vs communism is absurd.
The communist POV would be arguing for state-run MLMs, and that’s the farthest thing from anyone’s mind. MLM is shit no matter what system it operates under.
Scott said: “Then, there is the price issue. Sizzler sells a steak at $20 while Ruth Cris (sic) sells the steak at $80. It goes to the same place and out the same exit. But, only poor coveting people complain about the cost difference. Ruth Cris claims their steaks are fed differently and say that’s the cost difference. Who knows really?”
Seriously? Who knows??? What a ridiculous statement! Sizzler’s steaks taste like a baseball mitt made out of dog hide, while Ruth Chris serves up a pretty extraordinary piece of expertly prepared aged USDA prime beef, and with an exceptionally high level of service in a setting that makes a Sizzler look like an outhouse. The difference is monumental and easily quantifiable on every possible level. MLMs sell the equivalent of the dog-mitt in the outhouse and charge Ruth Chris prices for it, and they justify the inflated price by lying about the product and its value. Also, I have never once heard anyone complain about the cost differential between Sizzler and Ruth Chris. That’s just another poorly thought out analogy, typical of the way all MLMs are promoted.
Aside from that, the prices you quoted are wrong. Sizzler doesn’t sell any steaks for more than $17 and the only steaks that Ruth Chris sells that are over $65 are steaks that feed 2 people. It helps when you actually bother to do research instead of just pulling random numbers out of yer arse. But I suppose you’d argue that math (which you also don’t understand) is communism too.
https://www.yelp.com/menu/sizzler-los-angeles
https://www.toprestaurantprices.com/ruths-chris-steakhouse-prices/
Scott said: “As far as some MLM distributors saying how their products cure cancer and diabetes, unless customers complain, it’s hard to monitor all the distributors.
No, it’s not hard at all. You can pick any snake-oil MLM at random and in a mere matter of minutes, identify scads of distributors making such illegal claims on the internet, and many of them are high level within the pyramid. If I can find them that easily, so can the compliance departments of the MLM companies, but they do nothing because the fraud is part of their business model. And if they cared a whit they would use a different business model instead of unleashing legions of untrained financially-motivated lying idiot MLM distributors to swindle and potentially injure or kill people. Fortunately, the law makes no distinction between claims made directly by an MLM company and those made by their distributors. The company is culpable in either case.
Scott said: “To outlaw the entire business is communism.”
Again, the way you wantonly throw around the term communism shows that you don’t have even the faintest clue as to what it actually means; which is not surprising because MLM cheerleaders are without exception, dumber than a sack of hammers. MLMs operating with the capitalist framework are not exempt from laws/regulations. If you are instead advocating a system without laws and regulations, then you are essentially arguing for anarchy, a system in which you’d last about a minute before becoming someone’s lunch.
Scott said: “So, come up with a way to monitor and regulate that doesn’t jack up costs even more. Then, you can legitimately comment.”
The reason MLM products are so overpriced has nothing at all to do with the manner in which they are regulated (not to mention that they are barely regulated at all). It’s because the parasites who run the MLM companies must charge exorbitant prices to payout the pyramid scheme’s commissions. It’s the only way the model can be sustained and it’s another terrible feature that’s baked into the business model.
Overall, a truly epic fail on your part Scott.
Once I realized you were trying to sell something yourself, the validity of this article went out the window. I am of the firm belief that you never throw other businesses under the bus to improve your business opportunity. That’s just not right. Speaks volumes.
I only offered some other ideas because people have asked for them after saying, “Well, you are right about about MLM, but I need *something* so what can I do?”
A validity of an article stands on the merits and facts presented. I sourced other articles and even reader comments to compile the list.
If you don’t value the information, then you can be enjoy being the 99.9% who lose money in MLM. Please just don’t drag others down with you. To use your words, “That’s just not right.”
Thanks to the Internet & available platforms, the truth about the MLM scams (Primerica is the worst, in my opinion) is being made available to the public. Public awareness and knowledge are the keys to bringing down this corrupt industry. The FTC doesn’t do enough, because of lobbyists, so bringing the truth to the consumer will hopefully rid us of the MLM scourge.
Take Shane A. Rudman for example. He’s the worst of the worst, in my opinion. He’s a Senior Regional Manager in Primerica. He screams arrogance & corruption. He’s on every social media platform available – Facebook, Twitter, & Instagram. His family has their own website. He openly brags about his excess consumption. The irony is he owes the IRS $43,598.02. That amount can be verified on finra.org; finra stands for Financial Industry Regulatory Authority. He’s also a defendant in a civil lawsuit in which Prater Oilfield Services is the plaintiff & KS Dept. of Revenue is a defendant also.
Primerica uses religion as a marketing tool. They openly tell their recruits to join a church, because the parishioners are an excellent market. Just preach morality & quote Bible verses. That will attract unaware & uninformed parishioners. What a scam.
So I guess you think owning a franchise is not a owning your own business either? Guess what, as a franchise (such as McDonalds) I don’t get to set my own prices, hours of operation, advertising, ingredients, restaurant layout, tile selections, distribution, product decisions, color schemes, recipes, or anything else. you my friend are an idiot and you have no clue of mlm or independent business ownership.
Did you read the article? Please see #4 where I wrote, “McDonalds won’t let franchise owners open up multiple ones on the same street unless there is sufficient demand. Otherwise, they would compete for few customers and go out of business… MLM has no problem with creating millions of distributors even if there is no one interested in buying the product. They don’t ensure that there’s enough demand for product for the distributor to make money… If you put ten McDonalds on the same block, you’d expect them to lose money and go out of business. You wouldn’t blame the individual owners of the McDonalds franchise. When 99% of MLM distributors lose money, they are the ones that are blamed for the failure.”
I hope you didn’t buy into a bad franchise. That can happen. However, a reputable franchise, like specifically McDonalds which we both refer to has a key differentiating factor – location.
It’s extremely important to not that McDonalds franchises don’t recruit other McDonalds to compete with them. That’s just dumb. The last time you bought a McDonalds burger did the owner try to sell you on buying a McDonalds franchise? Of course not. No McDonalds owners do that!
Recruiting customers to start a similar business is widely used FTC metric (source: ) of a pyramid scheme, especially when levels are introduced, so it is best to never get involved in anything that has levels or recruiting.
I think we can agree that McDonalds franchises does not have recruiting or multiple-levels (of income paid to recruits).
Is that fair?
says the person working for a company who calls their competitors products “trash value” lol
It’s not clear what you are referring to. I can’t find a mention of “trash value” anywhere on this page. So which person is saying which thing about which products or competitors is unclear.
This was in relation to the following comment;
Janie Radcliff says
May 25, 2019 at 9:46 am
Once I realized you were trying to sell something yourself, the validity of this article went out the window. I am of the firm belief that you never throw other businesses under the bus to improve your business opportunity. That’s just not right. Speaks volumes.
Okay, that makes sense.
I’m no fan of MLM’s but the debate did make me wonder about a lot of businesses. It seems to me that that many businesses do not have the right to set prices, franchises for example. You can’t set your own prices for Big Mac’s or milkshakes, I believe those are set by McDonald’s corporate. Yet it would be hard to argue McDonalds isn’t a business. Independent insurance agencies certainly look like a business but they can’t set the prices of the policies they sell, those are set by the companies that provide the policies. Yet they seem to be businesses to me, and not just salesmen. Even regulated public utilities, their prices are set by public service commissions.
I had a bigger article about franchises on another website that I used to own, but failed to keep up with it. Essentially franchises are protected by the supply and demand section. Also, no franchise I know is taught that the main goal and way to make money is to recruit more competing franchises. It isn’t the typical experience where someone enjoying a burger at McDonald’s will be pressured to buy a McDonald’s franchise.
That said, I believe McDonald’s franchises can set some of their own prices. They can have discounts in an effort to get more people in and make it up in volume. Again, I think this is true based on what I’ve read, but I can’t find a definitive source. The ability for franchises to set prices isn’t that great though.
I was surprised to find that McDonald’s itself is very much in the real estate business. I’d link you to some articles, but the best ones I found are paywalled.
Another thing about a franchise, is that you are really buying a business, not starting one. There are MLMers that buy their way into a certain place of the pyramid (buying a downline), but that’s done in secret deals behind closed doors.
I’d say that an independent insurance agency is a group of salesmen. I’m not really in that industry and don’t know how it all works.
I don’t know if I consider a public utility a business any more than I would consider a police station a business, but I would entertain a discussion of it offline – since it has nothing to do with MLMs.
Franchises fall under the FTC’s “Business Opportunity Rule” which requires they provide participants with fully audited disclosures of their opportunities. The MLM industry successfully fought tooth and nail to be exempted from the rule.
That’s a great point about how MLMs fought tooth and nail to make sure that they weren’t viewed as “Business Opportunities” according to the FTC. That could tell you all you need to know about them not being a business.
According to the FTC website (https://www.ftc.gov/tips-advice/business-center/guidance/business-guidance-concerning-multi-level-marketing):
“10. Are MLMs subject to the FTC’s Business Opportunity Rule?
As stated in the Business Opportunity Rule’s Statement of Basis and Purpose, the Commission crafted the Rule to avoid broadly sweeping in MLMs. It did so by tailoring the definition of business opportunity to exclude certain types of business assistance common to MLMs. 76 Fed. Reg. 76816, 76824 (Dec. 8, 2011). It is important to note, however, that the Rule does not explicitly exempt MLMs from coverage. As with any other business entity, the determination whether an MLM would be a business opportunity to which the Rule applies would have to be made on a case-by-case basis.”
Your name is Lazy Man. Ugh… that seemingly explains a lot at first but with a benefit of doubt.
[Editor’s Response: Have you read my 2400 articles? How about all the 1000+ comments on this? Those would seemingly explain a lot more.]
You then proceeded to reply to Scott by further elaborating on Primerica. You removed that doubt once you stated that “I haven’t studied Primerica,”. Ranting on and on and on about something that you have not studied does not make you wise but a fool as you openly revel in your chosen nickname.
[Editor’s Response: I didn’t rant on and on about Primerica… that’s what Scott did. I think you are mistaking my comments with a reader who has studied Primerica. Aside from your mistakes there, you’d have obviously say that I’m not “lazy” due to what you consider “ranting on and on.” As for whether I’m wise or not, we have 1000+ comments on this article and no one is refuting it.]
I’ve studied Primerica. What is it you’d like to know, or rather, what is it you’d like readers not to know???
If any of these MLM schemes were real attempts to have a product they would be selling them directly to Walmart or Amazon. Why would they need you? Nobody does this door to door peddling stuff anymore, this isn’t the 30s? The point is that the so called “business owner” IS the final customer for this junk. They end up with a garage full of this crap and out a small fortune under the greedy delusion they will get rich selling it. Wonder if it ever dawn on them that they were the mark?
Most victims of MLM aren’t even aware of the term MLM, or that they’re in one. And even after failing and leaving, they’re still unaware. Many jump onto another MLM opportunity only to fail again. They are brainwashed to think that failure was their lack of effort, instead of realizing that MLM is designed to make people fail.