Within multi-level-marketing businesses, it’s very common for recruits to buy a lot of product prior to selling too and may not sell any of it at all – but by this point, the MLM company doesn’t care, they have made a profit.Įven if they’re selling to somebody who never legitimately wanted to buy their product at all – they just wanted to buy into the business. However, any business that first and foremost promotes recruiting others into the business, above any actual sales of their products or services, is arguably a questionable one. They do have legitimate products and these products have been purchased outside of the business, (not just bought by their consultants). Let me point out from again that I do not see Rodan & Fields like this... It’s important to note that the above definition does not mean that just because an MLM has products or services associated with it, that it can’t be a pyramid scheme.īecause if the product or service is deemed irrelevant to what is really going on, (ie a recruitment scheme) then the products are just a smoke screen. > Unsure about joining an MLM? Try this instead.
While I don’t think Rodan + Fields is a pyramid scheme, it’s understandable that this and all other MLM’s are compared to them, (and some even revealed to be them on closer inspection). However, Rodan + Fields claim that 65% of their profits actually come from direct sales to customers, not from sales from consultants.Įven so, the emphasis on recruiting others into the business, rather than products, is a common theme for MLM’s and something they’re criticised for.Ī business will start to be in danger of looking like a Pyramid scheme, when the main emphasis goes towards selling the business model and not the products. One successful representative claimed: “I always lead with the business, not with the products.”ĩ5% of her income comes directly from recruiting others into the business, not from the sales of products – (source) What Is Rodan And Fields: A Pyramid Scheme Scam?ĭr Rodan and Dr Field started their skincare brand in 2002 and to begin with, they sold their products directly in stores.īut in 2009 they decided to withdraw their products from stores and decided to create a multi-level-marketing opportunity – whereby, consultants could sell their products independently and recruit others to do the same.