Selling your soul to Usana Health Sciences for $27,000 a year
If you were going to join a multi-level marketing company like Usana Health Sciences (NASDAQ:USNA), what would your goal be? Would you aspire to be one of their million dollar earners? That sounds awfully prestigious, doesn’t it?
Well check out this excerpt from a recent press release by the company, and then catch my comments at the end.
SALT LAKE CITY – January 22, 2009 – Colette Evans was approached by her husband, Allen, 14 years ago about starting a home-based business with USANA Health Sciences. Though skeptical at first, Colette started taking USANA’s nutritional products and saw an improvement in her health. Once she saw firsthand the effectiveness of the products, Colette decided to work side-by-side with her husband introducing USANA to others and building a successful business
Through hard work and determination, the Fort Lauderdale, Florida residents recently reached a major milestone with the company, becoming the newest members of USANA’s Million Dollar Club.
USANA’s Million Dollar Club is made up of distributors who have earned at least $1 million in commissions through their USANA business. To be officially inducted into USANA’s exclusive club, Colette was treated on Jan. 22 to a “million dollar day” as part of an unforgettable trip to USANA corporate headquarters in Salt Lake City.
That all sounds so fabulous, until you do the math. It took these two people 14 years to get to the $1 million commission mark. Divide that million by 14, and you see that each of them was grossing about $35,000 a year in commissions, on average.
Then, of course, you must subtract business expenses, because they surely didn’t earn those commissions without spending some money. Let’s be very conservative and assume that they spent only 25% of their commissions on business expenses. (It’s probably a lot more than that, but I’m being generous .)
That means each of these people earned just under $27,000 a year for the last 14 years of their Usana lives. How impressive is that?
It’s just indicative of the spin that MLMs constantly have to put on their numbers. They’re not going to announce to everyone that this couple made $27,000 a year each in Usana. That’s not impressive. Instead, we’ll throw around the $1 million figure and hope no one ever does the math.
According to my math 1,000,000 dived by 14 years is 71,428 not 35,000.
I’m I wrong?
Yes, Miguel, it equals $71,428. There were two of them working full-time, which equals about $35,000 each.
Hello,
I´m a proud Usana Distribuitor and I truly believe that everybody is entitled to express their opinion. That doesn’t mean that you have to talk without knowledge.
Have you ever tried to work on MLM, because I have done it for the past year and it has help my wife in ways we can not describe. Besides that we decided to work hard on the business and as everything else in life, if you work just a bit you will earn small money, but if you work hard you will earn a lot.
That is fact of life. I learned to play drums when I was 14 years old and work my but off. I got to be the best drum player and my other friends didn´t practice at all and did not acomplished anything, so by your way of thinking is playing drums a fraud because they spended 4 years trying without practicing, and for that reason I should be called “Lucky” or “Gifted” NOOOO. I work my but off. That why I played better.
But you can not talk about playing drums or MLM because you have not done either of them. So maybe you should try to do so before considering talking about something you don´t have the moral authority to talk about.
If you try MLM and fail, you’ll be a looser because you quit, because anybody that works constantly will succeed in anything, not just MLM.
By the way I have my own company which I’ve worked for the past 10 years and I’m consider a succesful business man, supporting more than 44 families and now with Usana I have great health and I’m building the greatest MLM business.
¿What have you done for someone else in your life?
Yours Truly.
Ramiro Berner
This claim is incorrect as it neglict the fact that you earn annually large sum of income each year even before the couple reached its annual income of 1 million. If it was 1 million for the last year, 600000 for the five years before that and 300000 for the five years before that and the first 3 years they earned nothing at all just to set up the business, they are still much better off as they have earned accumulatively 5.5 million dollars over 14 years which is equivalent to 392857.14 dollars for the couple per annum. This is more than most people earn in this country. Furthermore, it is residual, another word, you don’t need to work to receive the 1000000 a year for the rest of their lives. Well done to the couple is my opinion.
Steven
Unfortunately, your energy is spent to tear down a couple who did something great and who continue being pillars of society. Your self-serving blog designed to sell your book requires you to implement a strategy of tearing others down.
Your comments are an interesting view which are not bound in reality or logic. I actually know Collette and Allen as friends. In fact, I am in the process of becoming a distributor now being directly sponsored by them.
There are a few major challenges with your premise. You hold yourself to be a forensic accountant and yet, you don’t use simple accounting principles in your derision of the Evans’. First, you presume that both Collette and Allen worked the business full time and invested 25% of their earnings for the entire 14 years. What evidence do you have to support your premise of either their time or monetary investment? Additionally, you don’t account that their earnings will be continuing ad infinitum and are able to be passed on to their heirs. Finally, you simply divide the income by two since they both are in the business.
It is laughable that you would indicate that a part time income of 70,000 annually (which, in actuality is probably more) is somehow mediocre for a nominal investment of time (especially considering that 70,000 exceeds many household incomes…).
Did you know that an average veterans retirement is less than 35,000 per year? Based on your logic, this is a shameful amount of money. How many Americans would be glad to have a 35,000 residual income in perpetuity? Now, how many couples would be glad to have 70,000 in perpetuity?
Admittedly, network marketing is a challenging road which few people actually accomplish the lucrative levels. However, how many people develop a sustainable business which provides a predictable income of 70,000 plus annually?
The blame game society in which we live is pathetic. It is always somebody else who is to blame. The Evans’ are fantastic examples of strong ethics who took charge of their life and reap the rewards thereof.
My hope is you post this to your blog for people to see through your veiled attempt to peddle your book while seeing the lunacy of minimizing what the Evans’ have accomplished.
Shane
Wrong Steve. This is $1 million cumulative. So my math is correct.
Awwww Shane… Nice try to slam me, but this article has nothing to do with selling my books. My books aren’t directed at anyone who participates in MLMs, so none of the posts about MLMs are meant to sell books. They’re simply informational articles to aid consumers.
Now I agree with you that a $35,000 a year salary would be quite a lot for some people. But here’s why it’s a problem in the case of Usana (and MLM in general):
1. Terms like “million dollar earners” are used instead to make it seem like these people are living the high life.
2. Saying $70,000 a year income mischaracterizes things. This is two people working full time. So it’s a $35,000 job.
3. People in MLMs are notorious for understating the amount of time and effort put in for the small earnings. I’m willing to bet your “friends” put in more than 40 hours a week on a consistent basis.
4. The lie of residual income – This couple will not continue to earn $35,000 each for the rest of their lives unless they keep working at or above the level they are now.
This article and all others here are not part of any “blame game,” as you suggest. They are simply part of an effort to educate the public that they will be wasting time, effort, and money by getting involved in MLM. MLM is not a real business, and it’s been proven time and again with the data produced by the MLMs themselves that over 99% who get involved lose money. These are not profit-making ventures except for the owners of the MLMs and a tiny handful of people at the top of the pyramid.
I’m impressed that you posted my comments.
Here is my reply:
How can you state so plainly that your intent is not to sell books? The very intent of the blog is to dissuade people from entering an MLM through articles as well as your books. Your advertisements are clearly posted on this very page.
1. A million dollar earner IS a substantial income over a 14 year period. Please show me an American who would not like to have an additional million dollars BEYOND their normal income from part time effort.
2. 70,000 annualized is neither misleading nor a mischarachterization. On the contrary, 70,000 is a conservative estimate of the earnings when you consider that 70,000 does not account for the early years where the income was less. Furthermore, you simply divide the income in half because you determined that both Collete and Allen invested and continue investing 40 hours each in the business. Again, as in the first post, what evidence do you have that supports this specious claim? You have provided no data as to the hours they specifically invested.
3. You lump the Evans’ into a nebulous group of MLM people who understate the time and effort for the small earnings. The logic you follow lacks the evidence specific to the Evans’. Therefore, it (your logic) fails the litmus test.
4. You indicate the income will not continue into the future without continued investment of 40 hours per week. Here is my question to you; What evidence do you have that supports this claim as it relates to the Evans’ previous earnings in relation to time invested? Also what evidence do you have specific to the Evans’ that indicates lack of future potentiality?
Finally, this certainly is a blame game. This is misdirected anger at various MLM’s that are deemed legitimate businesses as defined by the FTC. Frankly speaking, the credibility of the FTC opinion trumps your accomplishments.
The fact of the matter is that few people attain substantial levels in ANY large corporation or any endeavor, period. How many CEO’s are there per company? How many Presidents are there per company? How many businesses fail in the first five years? Of the remaining businesses that survive the initial five years, how many last another five years? How many athletes in the world make the Olympics? How many of the Olympians actually win a medal? How many athletes win gold?
Just because the MLM model is difficult and requires time, energy, and money does not negate it as a viable alternative for an entrepreneur. MLM is not a get rich quick plan. But then again, what is?
In the interest of time, this will be my last comment on your blog. Thank you for the post. I wish you unbound success and happiness and prosperity.
Sincerely,
Shane
Shane – Apparently you’re having a hard time understanding that my books have nothing to do with MLM and are not marketed to anyone who’s into MLMs. There’s a completely different market for them. I don’t sell books by writing about MLMs. But that doesn’t mean I’ll apologize for having my books posted on the site.
Whether or not $35,000 income per year is something to get excited about is in the eye of the beholder. Let’s not pretend that this couple spent a “few hours a week” on Usana as a side venture. Let’s tell the real story. They eat, sleep, and breathe Usana. $35,000 is not an impressive income for that. (Notice again, that I reject your usage of $70,000 a year income because it was really $35,000 per worker.)
Common sense and a working knowledge of MLMs is all you need to in order to know that the $35,000 income will not be a “residual income” nor will it last forever without a significant investment of time and effort by these people.
Fortunately for me, I don’t use the FTC as the authority on what’s a legitimate business and what is not. The Direct Selling Association is a lobbying organization funded by the many MLMs, and its sole purpose for existing is to induce politicians and government organizations to not do anything to curb the activities of MLMs. So unfortunately, the FTC can’t really be relied upon to determine what is or is not a legitimate business, as they’re notorious for turning a blind eye to the abuses of MLMs.
Your comparison of MLM to regular corporations fails. In corporations, the participants receive paychecks. In MLMs, the lower levels are all paying to play. They’re putting money into these scams, and 99% of them will never turn a profit (i.e. recover their investment). So MLMs and legitimate businesses aren’t the same thing at all.
You’re right. MLM is not “get rick quick.” It’s “get rich never.” It’s “guaranteed losses for 99%.”
If I was living in a tarpaper shack in the slums outsite Sao Paulo, Brazil I imagine that I’d be thrilled at an annual income of $35K a year.
However, that is not the case.
Ms. Coenen, how do you know that the million dollar figure is cumulative and not an annual number that the couple has reached?
Read the article.
“USANA’s Million Dollar Club is made up of distributors who have earned at least $1 million in commissions through their USANA business.”
And if the words themselves don’t convince you, you could do the math on how much the downline would have to order in a year, and see that it’s not $1 million in commissions for the year.
Poor reading comprehension and basic innumeracy seem to be the defining hallmarks of commentators who defend MLM’s. This explains much about the target demographic that these schemes appeal to.
Dear fellows and Miss Tracy Coenen,
Just want to know whether that extracted article is talking about Colette. Cause only Colette was offered for the trip. Her husband might sitting at home the whole day doing nothing but just motivating his wife. If what his husband was doing earn him 35,000 per year then I wish I could be that husband too.
Another question, I wish to know did Miss Coenen ever tried to do any of these MLM? For me the cost of doing this business might be $ 20 (a cup of coffee, foot by cute prospects), my time and my transport fuel.(not really cause I was enjoying the same time)
To be frank, MLM will earn you money, but whether sustainable is another question. I used to earned $10k per month for a year or two in a year time. I did my professional degree on accounting and I have never got paid for more than 2k per month.
I wonder how much a forensic accountant earns per month….. Might be more than 10k because they will receive a cheque after they successfully detected fraud? Is it a fraud for professionals to receive fee when they are doing jobs that they cant guarantee the outcome themselves? Such as I might not get to detect the fraud but you still have to pay me?
Hi Tracy, i just wanted to thank you for your Article, i was recently invited to join Usana in Mexico and there is something suspicious about this, i could be wrong of course, but the person who invited me is a very good and close friend of mine and there is something different now with him, it’s seems like everything now has to do with this company, i would like to get in touch with you via email to know more on how this operate, in your honest opinion, will this model work? where exactly is the small print on this? is this similar to Amway? (a model i have been in contact with in the past and know more about. I really dont’t know if this is a good business opportunity and for the moment don’t really care that much as i’m not a money driven person, i just want more information on this because i’m really concerned about my friend and his family. Maybe i’m paranoid but the meeting i went to hear about this seems more like a CULT than a business venture!! Please any Information or Point of View on this company will be Greatly appreciated!! … Sincerely: Raul Mejia