Is Arbonne a Pyramid Scheme? What You Should Know
If you are looking into becoming an Arbonne independent consultant but worried that it might be a scam then this review is for you. There is a lot of controversy surrounding this company and many are even asking is Arbonne a pyramid scheme?
I have reviewed the business opportunity here and there are definitely a few important things that you should know… things that people in the business aren’t going to tell you. But I will.
Disclosure: I am not in any way affiliated with Arbonne. This is a 3rd party review and is intended to be as unbiased as possible.
Arbonne Independent Consultant Review
- Company: Arbonne
- Website: arbonne.com
- Recommended?: Not really, more on this
Just to make it clear here. I am reviewing the business opportunity that Arbonne offers, not their products.
Arbonne is a company in the health industry. They sell skin & hair, makeup, and nutritional products, all of which consist of botanically based ingredients.
They operate under a direct sales business model. This is what you are interested in because anyone can join in as an independent consultant and start their own home-based business.
This business also has a mlm structured compensation plan and this is why many are questioning whether or not this whole thing is a pyramid scheme or not, which I will get into.
How Arbonne Could Be a Pyramid Scheme
Arbonne does have products. And honestly from what I hear and what I have read their products are pretty good.
The products they sell, like in most mlm businesses, are largely based on hype. They are very overpriced and are all about the botanically based ingredients. Going green and using plant-based products instead of harsh chemicals is the way to go for sure, but I just can’t really agree with the prices.
But anyway.. this company does have and does sell legitimate products.
For them to be a pyramid scheme they would have to be what you call a product-based pyramid scheme. Basically what this means is that, although they do sell products, the revenue would have to be overly dependent on recruitment rather than on product sales to the general public.
And to answer the question of whether or not this business is overly dependent on recruitment of new members you have to look into their compensation plan…
The Comp Plan
The first way that you can earn as an independent consultant is by retail sales. You will earn 35% commissions on sales that you make directly to customers. And if you get Preferred Clients, which are clients that become members (not consultants) and place monthly orders, you will get 15% of commissions from their orders.
Retail sales are great when you are just starting out, but what is really going to make you money is recruiting other people. Everyone that makes good money here knows that recruitment is the key. You need to recruit, recruit, recruit and build up your downline so that you can make money from their efforts.
I know this chart may seem confusing above, but I’ll try to simplify it for you and tell you what you need to know.
When you first start out as a consultant you will only have access to Central Group overrides of 6%. This means that you can earn 6% commissions off of what the consultants below you sell.
And as you recruit more people in and build a team, you can get promoted to management levels and earn higher override percentages as listed…
- District: 8% override commissions
- Area: +6%
- Regional: +3%
- National: +1%
Another very important part of this mlm structure are the generation overrides that you can make.
You see, when a consultant in your downline moves up the ranks to that of District Manager or above, they break off of your “team” and form their own “team”. This may seem like a downer but you can then make generation commissions off of their entire team, which is means more money.
You can receive these generation overrides up to 6 generations deep. If a consultant breaks off of your team and forms their own team that is your 1st generation. Now if someone breaks off of their team and forms another team that is your 2nd generation, and so on.
You will have to move up to the national director level to be able to earn on all 6 generations.
Does Arbonne Cross The Line?
In my opinion, although Arbonne’s comp plan is obviously focused on recruitment, this company doesn’t cross the line.
The reason I say this is because to move up the ranks and really make money you can’t just recruit people. You have to recruit people and get them to make retail sales. You will have to get a certain Qualifying Volume (QV) to move up the ranks and you won’t get any from new recruits purchasing starter packs.
This is one of the ways that Arbonne forces consultants to actually make retail sales.
So although they definitely do focus on recruitment, they also put a good deal of focus on retail sales which makes them legit in my opinion. And I guess the FTC agrees because they haven’t shut them down yet.
Sound Good? You Might Want To Reconsider
The problem with mlm’s like this is that they are very difficult to make good money with. The way that they are set up you can only realistically make good money if you build a big downline and move up the ranks. So what this means is that you are going to need to recruit a lot.
What this also means is that only the top few % actually make good money while newcomers slave away for very little pay.
Arbonne’s official 2015 income disclosure proves exactly this. I know its a bit old but its the most recent official disclosure I could find and it proves the reality of this business.
As you can see 97% of all consultants earn much less than what is considered “livable”. In order to make good money you have to make it to the top.
Final Thoughts & What I Recommend
Arbonne is a legit opportunity. They are not a pyramid scheme although they do obviously place a lot of emphasis on recruitment. Unfortunately this often leads to consultants recruiting by somewhat misleading and deceptive means.
There is no doubt that you can make good money with Arbonne but don’t underestimate how hard this is. The large majority of people fail to make good money. You need to be a recruitment machine in order to really make it.
Personally, I don’t have anything even close to a salesperson type personality and there is no way I would make it in this mlm business. I just wouldn’t be any good at recruiting. If you are like me then I would recommend you take a peek at how I make money online.
I make a living working for myself online, which I think is a pretty awesome job. You can learn more about it by clicking the link below that will take you to a post I wrote.
In the post I wrote I explain what it is that I do, how it all works, and how others can do the same.
I would only really recommend Arbonne to people who have that salesperson type of personality and of course actually like the products that they sell.
Comments, questions, concerns??? Leave them below in the comment section and I’ll get back to you soon 🙂