Part 2
Most MLM reps – usually women needing flexible work – earn very little indeed and some lose money. They often have to buy stock upfront or stockpile products to meet sales targets. Forever Living – an American company that launched in the UK in 1992 and has an estimated ten million reps worldwide – has consistently denied that it’s a pyramid scheme and points at the physical products it sells as evidence that it does not focus solely on recruiting members.
But critics say the line is blurred.
According to its website’s most recent Income Disclosure Statement in 2022, while most people choose to buy the products at a discount rather than join the MLM, 89.8 per cent of reps received no ‘meaningful’ income, and of the 10.2 per cent who did, 58.6 per cent earned less than £375 a year.
The founder, Rex Maughan, amassed an estimated net worth of over $500million (£373million) before he died in 2001, leaving his son, Gregg, as chief executive.
This April, after accusing the company of misleading people as to how much money they could make, America’s Federal Trade Commission prohibited it from making unsubstantiated earnings claims. In May, Forever Living stopped operating as an MLM in the US. American reps can still sell products, but not profit from recruitment.
In the UK, however, bold claims about income are still being made. Training material I’ve seen from this summer claims new starters can earn £75 to £300 a month (when in fact this could put them in the top 1 per cent of Forever Living earners) and earnings of up to £5,000 a month are ‘possible’ within 16 weeks, it says.
For the ‘very ambitious’, one of the UK’s top sellers suggests in a video recorded this March, a salary of £100,000 is possible.
In response to this, a spokesman for the company says: ‘The £75 figure relates to an example of potential retail profit from product sales.
‘Our Income Disclosure Statement reports bonus and incentive payments made by Forever Living and therefore measures a different form of income. The figures are therefore not directly comparable.’
But for Alison, such distinctions are irrelevant. An inherently private grandmother from Warrington, Cheshire, she cuts an unlikely whistleblower, but within minutes of talking to her it’s clear just how furious she is.
‘It’s just so misleading and can potentially ruin you,’ she says. ‘But I want people to know. You can’t make real money selling products. You can only make money by recruiting a team. I believe it absolutely is a pyramid scheme.’
Alison’s interest in Forever Living was piqued when she met Sarah – as we’ll call the woman who recruited her – selling Forever Living products at a market last spring. Its range of deodorants, soaps, supplements and gel drinks often contain aloe vera, which is said to have anti-inflammatory properties that may help lower cholesterol and blood sugar levels and aid digestion.
‘The natural ingredients appealed,’ says Alison, who believes the £27.09 aloe vera drinking gel helped her joint problems caused by arthritis and the nervous system condition fibromyalgia. ‘I didn’t like synthetic ingredients in health and beauty products.’
Sarah, meanwhile, was a mum in her 50s, who had been with Forever Living for 13 years and worked her way up to manager, the fourth level up. (There are five rungs on the rep ladder, and then another six rungs of leadership reps above that, each earning a progressively higher percentage of sales profits from those they recruit.)
‘I hated being on benefits,’ says Alison. ‘I thought this was something I could do from home.’
She had never heard of MLMs. Sarah told her she’d need to build a team for ‘lasting growth’, but that ‘the idea is you sell goods, first and foremost’.