Welcome to our Forever Living MLM business opportunity Coffee Talk.
This discussion is a review of Forever Living… Especially, the popular debate, whether “Forever Living is a pyramid scheme?”
When people talk about a pyramid scheme, it also means they are calling “Forever Living a scam.”
We must find out,
- The costs of starting a Forever Living business?
- Can you make money with Forever Living? And
- Whether Forever Living mlm business profitable?
“Profitability” is the only way for us to make money and recover our investments with Forever Living.
If you are thinking of investing your hard-earned dollars in Forever Living Business, you should at least read this Forever Living Review to fully understand the risks and rewards of owning a Forever Living mlm Business.
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Forever Living Review Summary
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What Is Forever Living?
Forever Living is the largest privately held mlm company manufacturing and distributing Aloe Vera–based drinks, bee-derived cosmetics, essential oils, and personal care products, worldwide.
Forever Living founded in 178 by Rex Maughan and Carl Jensen with headquarters in Tempe, Arizona.
Forever Living annual sales revenue reached $2.6 Billion dollars in 2017.
The company primarily sells its products through an mlm network of over 9.3 million distributors worldwide.
In the 1990s, Forever Living acquired Aloe Vera of America, a Texas Aloe Vera manufacture company, and to produce its own Aloe Vera based products.
By 2006, Forever Living was listed at No. 340 on the Forbes 400 list and considered the largest private companies in the United States.
Despite the company financial success, many journalists and consumer advocates have accused Forever Living of operating a pyramid scheme.
Yes, with over 9.3 million distributors, and more joining every day, but only 32 are considered top earns.
Based on the information available to the public, we can conclude:
- Forever Living is a private mlm company.
- It’s very difficult to make money with Forever Living home-based business.
- The majority of Forever Living distributors lost their interments, and
- Forever Living business is very competitive, only 32 out of 9.3 million distributors are top earns or less than 0.01%.
It’s highly unlike that you will make money as a Forever Living distributor.
Before investing with this mlm, it’s smart to compare it with other home-based business opportunities…
You can use My #1 Business Opportunity to make a comparison.
How To Join Forever Living Business?
There are two options to join Forever Living.
You can visit the company website and select the “JOIN” tab to start the signup process.
- You can join as a Forever Living Preferred Customers (FPC) for free and receive between 15% to 30% discount on product purchases. The more you buy, the higher the discount.
- But to become a Forever Living Business Owner (FBO), you must upgrade your FPC account by purchasing 2 Case Credits (CC) of products or a Start Your Journey Pak, which we’ll discuss the costs in the next section.
The Process Of Joining Forever Living Business
You can join Forever Living for free. But…
You need a sponsor to register as a Forever Living Business Owner.
If you don’t have a sponsor, Forever Young will be more than happy to assign you one.
Once completed, the application and purchased 2 Case Credits (CC) or a Start Your Journey Pak, you’re now a Forever Living Business Owner.
But, before you can earn, you have to sell or recruit others to join your Forever Living Business.
How Much Does It Cost to Join Forever Living?
As promised, let discuss the cost of starting a Forever Living Business.
I have told you in the last section, you can become FBO by purchase 2 CC of products or a Start Your Journey Pak.
You must wonder what is Case Credit (CC)?
Well, CC is the number of points that Forever Living assigned to each product. When you purchase Forever Living products, you also earn points. These points accumulate into Case Credit.
According to Forever Living, $214 products order is rewarded 1 CC. You can also say 1 CC is $214.
But, you need 2 CC to join Forever Living. So, you must place an order of $428.
There’s a catch…
2 CCs must be earned within 60 days or within 2 calendar months.
What about buying the Start Your Journey Pak?
The cost for a Start Your Journey Pak is $298.
Buying one of the Start Pak is much cheaper than buying 2 CCs.
Besides the initial costs of joining Forever Living, there are additional costs associated with operating a Forever Living Business,
The business operating costs.
I will discuss the two biggest operating costs for you in this Forever Living Review:
1. Time Investment To Build Forever Living Business
This is not a part-time business. If you want to build a successful Forever Living Business, you need to invest over 80 hours per week in recruiting and selling.
If we use the minimum wage of $8.00 per hours, then the FBO must invest at least $640 per week, $2,560 per month, of times in building this mlm business.
2. Forever Living Hidden Costs – “Product Purchase Requirement”
An FBO is required to acquire CCs to get promoted and earn bigger discount rates.
Every mlm opportunities use this monthly product purchase requirement to sell their products.
Forever Living requires all FBOs to purchase 4 CCs each month to remain active and earn commissions.
This means you are required to spend $856 (4CC x $214) per month to remain as FBO.
Besides these 4 CCs, For an FBO to earn another 8% and promote to the next level, the FBO must have 25 CCs or spend another $5,350.
There are four levels in Forever Living Business and each level has a CCs requirement. (See below)
I refer to these Case Credits requirements as, “Pay and Play!” If you fail to meet these requirements, you do not get promoted or even lose your business.
So, to remain active and competitive, you must spend more purchasing product to earn CCs. These are the “Hidden Expenses.”
I call this a hidden cost because most mlm companies do not disclose the requirement to new distributors.
Most FBO discovers this after joining Forever Living.
The real investments to start a Forever Living Business is more than the cost of a Start Your Journey Pak.
The biggest investment is meeting the CCs requirement. This can cost an FBO thousands of dollars over the years.
The monthly personal product purchase requirement is the reason why many mlm business owners don’t make money.
These hidden expenses destroy all your chance of making a profit.
MLM companies use the personal purchases requirement for two reasons,
- To sell products, and
- To meet the FTC guideline as a legit mlm business.
Without product sales, Forever Living is a scam or a pyramid scheme.
This goes to show you that the FTC guideline was not written to protect investors, but rather to protect the mlm businesses.
I personally view mlm businesses, such as Forever Living as a pyramid scheme, because only a few at the top make money.
Now,
Don’t you want to know how you make money with Forever Living?
This brings us to the next topic,
Forever Living Compensation Plan
Look, all mlm compensation plans are confusing and difficult to understand.
Do you know why?
Because they are designed to hide the truth that you might not make any money with the business.
Allow me to show you the first LIE by Forever Living.
The Forever Living compensation plan stated that new FBO earns 43% of retail profits from selling products.
What do you earn on a $1000 sale?
If you’re thinking $430, (43% of 1,000), you are wrong.
Here’s how Forever Living calculates 43%.
They calculated 43% using the wholesale price, not the retail price.
You earned only 30% of this $1,000 order, $300.
Why would Forever Living do this?
To inflate the commission rates!
It’s sounding better to say you earn 43% than 30%.
This part of our Forever Living review is NOT FUN,
However, the Forever Living compensation plan is the key factor in determining your profitability as an FBO.
So, we must try our best to understand it.
I’ll provide you a quick overview of the Forever Living compensation plan. If you want to see it in detail, just download a copy.
This is an mlm business. With the Forever Living compensation plan, you have two ways to earn,
- Retail profits, and
- Sponsor Others (recruiting).
But, to earn these commissions, an FBO must recruit others and meet the minimum CCs requirement.
No commission is paid for failure to meet both conditions above.
Retail Profits
When you start out as a new FBO, you are called an “Assistant Supervisor” (AS). The lowest level of Forever Living mlm organization.
As an Assistant Supervisor (AS) and before you recruit 1 person, the only way to make money with Forever Living is buying wholesale and sell retail.
As we have discovered above, the wholesale price is 30% of the retail.
However, Forever Living gives AS an additional 5% personal bonus.
This brings the discount of up to 35%, still not 43%.
At a 35% discount, if you can sell the item at a Forever Living retail price for $100, you earn $35 retail profits.
But, what happens in the real market?
Can you make money selling Forever Living products?
All I can say is not easy.
- I did a quick search on eBay and found a 12-packs of Forever Living Aloe Vera Gel Minis for $69.75 with free shipping.
- The same 12-packs at Forever Living website retails for $77.24 plus shipping.
I’ll let you decide if this is a profitable transaction!
If people can find something cheaper, they will go for it. Even if this is product dumping by ex-FBOs.
Recruiting Earnings
The biggest earning with all mlm opportunities is recruiting.
The Forever Living compensation plan refers to this earning as Group Bonus (GB).
But, to earn this bonus with Forever Living, two conditions must be met:
- The FBO must personally purchase 4 CCs for the month, and
- You must be an Assistant Supervisor (AS) to earn this bonus.
This is how Group Bonus determined.
You, as an AS, have a 5% personal bonus. When your sponsor preferred customer places an order, you earn 5% GB.
This means if a preferred customer order $100, you earn $5 GB.
However, if the preferred customer advances to the AS level, you must advance to Supervisor level (S) to earn GB.
At the Supervisor level, your personal bonus is 8%. The GB between AS and S is 3% (8%-5%).
So, GB is determined by the difference between your level and the level of the person you personally sponsored.
Below is an illustration of how GB calculates?
The Forever Living compensation plan sounds impressive, right?
But, to earn GB, you must first recruit others to join your organization. It’s easy to say, but not easy to do.
This means an FBO could potentially earn nothing from recruiting.
Let me explain,
An FBO must satisfy all these requirements to earn a recruiting bonus:
- Must maintain active status, purchasing 4 CCs or $$856.
- To become Manager with an 18% bonus, you must accumulate 120 CCs. This means you must generate $25,680 in sales, and
- Your recruits must purchase products. If no one in your organization is buying, you still earn nothing.
Under this compensation plan, it is very difficult to make money. The Forever Living compensation plan is designed for this purpose.
Yes, there are many ways to explain the Forever Living compensation plan, and I can assure you, none of them is 100% right.
We don’t need to fully understand the Forever Living compensation plan, Because…
The Forever Living compensation plan doesn’t give us the actual earnings of an FBO.
Actual earning is the information that determines profitability.
Then, why we discuss the Forever Living compensation plan?
To help answer this question,
Can You Make Money With Forever Living?
Forever Living is a private mlm company. Therefore, it’s very difficult to find the earning disclosure statement.
When a new FBO asks Forever Living for an earning disclosure, they’ll receive a copy of the compensation plan.
Do you know why they do this?
Well, by giving you the compensation plan, Forever Living is selling you a dream, not a real business.
Are you investing in a dream or a real business?
To find out the truth about making money with Forever Living, we must look at the Forever Living earnings disclosure statement.
Here’s what I mean,
- The Forever Living compensation plan offers the POTENTIAL EARNING, a guess or an estimate.
- Forever Living Earnings disclosure statement contains ACTUAL COMMISSIONS distributors earned in the prior year.
As a business review writer, I look to the actual commission/earnings to advise clients on an investment. Potential earning is just a guess, an estimate.
Are you investing based on a guess?
If your answer is NO, then let discuss Forever Living earnings statement.
Here is a copy of Forever Living earning disclosure statement:
Looking at the earning disclosure for 2018, this is what we can tell.
FBO Incomes
86.6% of all Forever Living members did not make money with Forever Living in 2018.
If we are using 9.3 million members worldwide, this means only 13.4% earn some type of commissions.
However, according to the earning statement, only 11.4% earned a volume-based bonus.
Do you remember our discussion on recruiting bonus?
Recruiting bonus is the personal sales volume-based bonus, and just 11.4% of the 9.3 million earned this bonus.
To put this into numbers, we can say over 8.2 million couldn’t recruit a single person to join Forever Living.
Are you still interested?
OK, let continue reading…
Out of the 11.4% we had 69% of FBO earn an average of $105 per month ($1,263 annualized).
What’s this mean?
69% of 11.4% is 7.9%….
WOW, only 7.9% of FBO earned $105 per month with Forever Living.
Is a $105 earnings per month a profitable business?
Can you see? More than 93%, not 86.6%, of FBOs not making money with Forever Living.
The next group of FBO earned an average income of $1,493 per month.
But, only 3.4% of all FBOs achieved this income level (30% of 11.4%).
After studying this earnings disclosure, I can tell you this… You have less than 4% chance of making money with Forever Living.
We don’t need to analyze Forever Living earnings anymore, because as the earnings increases, the percentage of earners drop dramatically.
This explains why out of 9.3 million members only 32 people are top earners.
But remember, the income we discussed above are not profits.
If you want to know the profits, you must take out operating expenses.
Let see what happen when we take out expenses:
We use the monthly average earnings of $1,493,
Every Forever Living distributor is required to purchase 4 CCS, $856 expense, which reduce the earning to $637.
If you take out the time investment, every FBOs in this income group operates with a net loss, not profit.
So, Is this a good investment?
Even if you make the top 3.4%, you’re still not making a profit.
Can you see how difficult to make money with Forever Living?
The only option to make money with Forever Living is to become one of the top earners.
But according to Forever Living earnings disclosure, less than 1% of all FBO can achieve this level.
Do you understand, why Forever Living provides people a compensation plan when asked, “Can you make money with Forever Living?”
Who’s going to invest if they find out the business failure rate is over 90%?
So, then…
Is Forever Living A Scam?
Yes, we agree that it’s impossible to make money with Forever Living, but this doesn’t make Forever Living a scam.
Here’s why?
Forever Living mlm business is an investment opportunity.
Every business investment has a certain level of risk, which means there a possibility of losing your investment.
Forever Living is a high-risk investment with a return of less than 1%.
If you decide to take on this risk, you cannot call Forever Living a scam when lost your investment, because this would mean every business investment is a scam.
All startup business has risks!
Before you start a business, like becoming a Forever Living Business Owner, you need to do research and evaluate the level of risk before investing.
Reading this Forever Living Review is a good way to learn the investment risk.
Never take on investment with over 90% chance of losing all your money. If you do, then…
You cannot turn around and call Forever Living a scam.
Many entrepreneurs hire a professional financial analyst to evaluate the risk of every business deal before investing.
As a Business Review Writer, I have evaluated hundreds of businesses to help investors managing the investment risks…
That’s all we can do, managing risks.
To me, Forever Living is not a scam. It’s just another high-risk investment.
Is Forever Living a pyramid scheme?
Here’s what I think,
Personally, I say Forever Living is a pyramid scheme.
Yes, Forever Living will not agree that they are a pyramid scheme.
But, looks at their earnings disclosure statement,
Do you notice a pyramid shape?
Yes, the largest commissions were earned by a few at the top, 32 of them.
Less than 1% earned thousands and millions while over 90% lost money as an FBO.
Here… what do you see below? This picture is taken from the Forever Living compensation plan presentation.
So, Is Forever Living Worth It?
You decide!
If someone tells you that the opportunity to make money with Forever Living mlm Business is less than 1%, would you invest?
Well, you just learn this from our Forever Living Review.
I’ll never invest in a business opportunity unless is profitable.
And profitability is determined by carefully analyzing the financial information, especially the actual earnings.
Forever Living is a risky investment.
Do you know why you want to start a home-based business?
To earn extra money from home, to be your own boss, or to achieve financial freedom?
And to make money, we invest in a PROFITABLE business!
There are much better and less risky home-based business opportunities.
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Another major business risk associated with Forever Living which people rarely discuss is the risk of Forever Living going out of business.
If Forever Living going out of business, every FBO is out of business.
Yes, it might not happen… But the risk is always there.
This means, when you become a Forever Living Business Owner, you are not the owner of your FBO.
Is this what you want? Building a business for someone else?
There’s a lucrative method that I and millions of people have been using to generate six-figure passive income online.
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Can you see?
Based on our Forever Living Review, your chance of making money with Forever Living is low, less than 1%.
Do you still think Forever Living worth it?
