One of the hallmarks of a product-based pyramid scheme is the absence of sales to retail customers. Examine a multi-level marketing company like Usana or Mary Kay, and you will see that for the most part, their distributors do not have any substantial retail customer base.<\/p>\n
How do I know this to be the case? Simple math. Mary Kay Cosmetics makes it easy for us.<\/p>\n
Mary Kay has five divisions for distributors. The “emerald” division had about 600 consultants and sales directors who made the “Court of Sales” for fiscal 2007. Let’s round up to 1,000, just for kicks and just in case I missed some. Multiply 1,000 by the five divisions, and you have 5,000 distributors in the United States who made Court of Sales in the recently ended fiscal year.<\/p>\n
What is Court of Sales? It’s really based upon orders<\/strong>, not upon any retail sales to anyone. But let’s err in favor of the company and assume that all the products ordered were actually sold to retail customers. In order to be part of the Court of Sales, a distributor must order $36,000 retail value of products.<\/p>\n Does $36,000 sound like a lot? It’s not. If all of those products were sold at the full “suggested retail value,” the distributor would net (at most) about $14,400 for the year. Not exactly a thriving retail business that one can make a living from.<\/p>\n Mary Kay has approximately 750,000 distributors in the United States. 5,000 of them, or less than 1%<\/strong>, ordered at least $36,000 retail from the company.<\/p>\n And that “less than 1%” figure is even worse when you consider that the company has 750,000 distributors at any given point throughout the year, but Mary Kay churns through 40,000 consultants per month. So throughout the year there are 480,000 distributors who leave the business in addition to that 750,000 headcount at year end.<\/p>\n And Mary Kay is not unusual. In fact, many in and out of multi-level marketing hold up Mary Kay as one of the best in the industry. If their retail sales are so poor, what does that say for other companies? <\/a><\/a><\/a> <\/a><\/a> <\/a><\/a><\/a><\/p>\n","protected":false},"excerpt":{"rendered":" One of the hallmarks of a product-based pyramid scheme is the absence of sales to retail customers. Examine a multi-level marketing company like Usana or Mary Kay, and you will see that for the most part, their distributors do not […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":false,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[184],"tags":[],"class_list":["post-908","post","type-post","status-publish","format-standard","hentry","category-pyramid-schemes-mlm"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"","jetpack_shortlink":"https:\/\/wp.me\/p6Z0e-eE","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/www.sequenceinc.com\/fraudfiles\/wp-json\/wp\/v2\/posts\/908","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.sequenceinc.com\/fraudfiles\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.sequenceinc.com\/fraudfiles\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.sequenceinc.com\/fraudfiles\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.sequenceinc.com\/fraudfiles\/wp-json\/wp\/v2\/comments?post=908"}],"version-history":[{"count":0,"href":"https:\/\/www.sequenceinc.com\/fraudfiles\/wp-json\/wp\/v2\/posts\/908\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.sequenceinc.com\/fraudfiles\/wp-json\/wp\/v2\/media?parent=908"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.sequenceinc.com\/fraudfiles\/wp-json\/wp\/v2\/categories?post=908"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.sequenceinc.com\/fraudfiles\/wp-json\/wp\/v2\/tags?post=908"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}