Is Rodan + Fields a Pyramid Scheme? What You Should Know
If you are looking to become a Rodan + Fields Consultant there are a few things that you should know about this business before you get into it (or not). Much of what you have been told is likely to be a lie due to how this business and other consultants operate.
Also there is a big grey cloud hanging over Rodan + Fields with the stinging question is Rodan + Fields a Pyramid Scheme or not? This is good question to ask because their business model does resemble one in many ways, and of course you don’t want to get into a pyramid scheme because you are likely to lose out rather than gain from it.
In this short review I’ll be going over what you need to know about his business and hope to help you make a more informed and better decision on whether or not you want to join.
Rodan + Fields Consultant Review
- Name: Rodan+ Fields
- Website: rodanandfields.com
- Cost to Join: $45 minimum
- Recommended?: For some, more on this later
Just to make it clear, I am reviewing the business opportunity that Rodan+ Fields provides, not the products.
Rodan+ Fields changed up their business model in 2009 when they took their products out of stores and decided to try out direct selling.
With their direct selling business model anyone can join in and start selling Rodan+ Fields products as a consultant, working from home and making money. These are skin care products that range from lotions to sunscreens to supplements.
They have what you call a mlm compensation structure. What this means is that you can recruit other consultants into the business beneath you and make money from their efforts. This mlm structure is why there are so many people questioning the legitimacy of this business and whether or not it is a pyramid scheme, which I will be addressing.
The Startup Cost
In order to work with Rodan+ Fields as a consultant, you must first purchase what they call a Business Portfolio which will cost you $45 at the minimum. But they will push you to purchase the more expensive kits. There are 4 kits that you can choose from, the most expensive being $995.
The Business Portfolio for $45 will give you an understanding of the company, what they stand for, and will outline what your first steps should be to get your home based consultant business up and running.
The more expensive kits will also have this Business Portfolio but they will also have products such as eye cloths, body moisturizers, sunscreens, supplements, and other Rodan + Field products.
Once you have one of these starter kits you are ready to make money.
How You Make Money
There are 5 ways that you can earn money as a consultant. These include…
1) Retail Profit
This is the profit you make when selling directly to customers. You will make the difference between the wholesale cost and the retail cost.
The percentage of profit you will make on a sale varies a lot but you can generally expect 15 – 30% profit.
2) Consultant Commissions
In order to receive this you will need to maintain a sales volume (SV) of at least 100 per month. If you have that then you can get commissions of 10% from the people on your level 1, which are the people you directly recruit into the business beneath you.
3) Personal Team Commissions
To earn these team commissions you first have to move up a rank to the position of Executive Consultant. You can do this by getting a Personal Sponsored Qualifying Volume (PSQV) of 600. This 600 PSQV comes from people that you either enrolled in the PC Perks Program or recruited as a consultant.
You can earn 5% off of all commission-able volume on your team.
4) Generation Commissions
You have to move up a rank again for these commissions to that of Level 1 Executive Consultant. To do this you have to first promote one of your team members to the rank of Executive Consultant.
Once you do that the person you promoted will break off of your team and form their own team. This team will be what you call your Generation 1. And you will get 5% commissions on their commissionable volume.
You can follow this same process again and create a 2nd generation up through the 6th generation, earning commissions from each level.
5) Performance Bonuses
These are just bonuses that are given to consultants that show good performance. They are given out once certain ranks are achieved. One notable bonus that is talked about a lot is a new car.
Total Comp Plan
I’m not going to go over this entire compensation plan because some of it I already mentioned above and it would take forever.
But pretty much all you need to know is that you start out as a Consultant where you will earn ONLY on retail profit. In order to move up the ranks and take advantage of the mlm structure here you will need to recruit more people into this business beneath you and you will have to make more retail sales.
Isn’t This a Pyramid Scheme?
The recruitment style nature of this mlm business definitely make it seem like it may be a pyramid scheme but I would not say that it is.
In order for it to be a pyramid scheme it would have to rely too heavily on recruitment of new consultants for its revenue rather than relying heavily on retail sales to the general public.
It is true that this business model really pushes recruitment. And its also true that in order to move up the ranks you could almost entirely rely on recruitment rather than retail sales to the general public. So there is definitely a shady side to it all.
But I just don’t think there is enough to prove it to be a pyramid scheme. They do focus on products and retail sales so I would say it is legitimate. And I guess the FTC agrees with me because they haven’t shut this place down.
But just because its legit doesn’t mean you should run along and sign up.
Related Reading: Difference Between MLM’s and Pyramid Schemes
This Is NOT Easy
The fact of the matter is that MLM’s are generally very hard to be successful in, and this is no different. Just look at the official 2015 income disclosure statement released by them in 2015 (I know its older but it proves my point).
If you do some math here you will find that 98% of consultants were ranked Level 3 EC or lower and this means they earned much less than $14,673 for the entire year on average. This means that 98% of them couldn’t even come close to making a living off of this.
Final Thoughts & What I Recommend
The fact of the matter is that with a mlm like this you are going to have to recruit like a madman to be successful. Many people that you do recruit are going to quit so you are going to have to be constantly recruiting.
Most people end up failing miserably because this is a darn hard thing to do. You have to have that salesperson type of personality to really be good at this and most people that start out soon find out that they don’t have this and they quite.
If you are like me and are just not the salesperson type and don’t think a recruitment style business like this is right for you.. and you want another option for making money with your own business, you should take a peek at how I make a living working online (link below). I work for myself online and its a pretty awesome career. In the post I wrote I explain what it is that I do, how it all works, and how others can do the same.
How to Find a Rodan and Fields Consultant
If you are all gung ho on becoming a consultant even though I don’t really recommend it too much, you are probably going to want to speak with another consultant personally that can help you get going. You don’t actually need to do this but it definitely will help if you are unfamiliar with these types of businesses.
To find a consultant in your area you can go to Direct Sale Said and search for one near you.
Comments, questions, concerns??? Leave them below in the comment section and I’ll get back to you soon 🙂