Stay Informed & Take Action
Herbalife is a pyramid scheme that harms millions of people around the world.
But it’s important to remember that the small changes that Herbalife has made don’t change the fundamental aspects of the business that make Herbalife a pyramid scheme.
Herbalife has caused distributors to lose billions of dollars.
1) Herbalife banned lead generation systems. For over a decade, new recruits were encouraged to purchase expensive leads and other ancillary items and services for their business. You can watch some distributors talk about their experiences with these systems, here: https://youtu.be/Hx3zdjgOuCc. Herbalife banned those systems in late 2013, after benefitting from their existence for years, and while this is certainly a positive step, it is irrelevant to whether or not the company is a pyramid scheme.
2) Since 2012, the Herbalife return policy has undergone a few changes, but it remains a convoluted, daunting process that few distributors use. HLF announced it would do away with the 10% restocking fee and would no longer deduct duplicative logistics fees and packaging-and-handling fees from the reimbursement. Almost a year later, it started to cover the cost of return shipping.
Still, in order to return product, a distributor must persevere through a lengthy process:
Importantly, these changes have nothing to do with whether Herbalife is a pyramid scheme, and have barely made the return policy itself less onerous.
3) The company expanded the qualification methods to move up or maintain status in the marketing plan. The idea was to make obtaining supervisor status more achievable for lower income individuals and “level the playing field.” In actuality, this change keeps people on the hook longer, increasing the chance of making them “accidental” supervisors. More people reaching supervisor is a statistic Herbalife can use to lend credibility to its business model. Unfortunately, this change is also irrelevant, as many distributors are still encouraged to make bulk purchases, and nothing about the payouts at the top of the plan changes at all.
Herbalife doesn’t disclose the average costs associated with starting an Herbalife business. For Nutrition Club owners in particular, this can mean thousands of dollars of unforeseen costs.
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