Is Nu Skin a Pyramid Scheme MLM? The Truth Revealed!
Is Nu Skin a pyramid scheme, or a legit MLM company? These days network marketing is all the rage, but what are the products at Nu Skin really like and, if you want to make money as a distributor, can you do it with the Nu Skin business opportunity?
Just before we launch fully into this review, I just want to say congrats on being here on my site and reading this. Many people simply join schemes without doing any research on them. You’re one of the smart ones that does their homework before getting involved, and that’s a good thing.
The chances of you ever falling for a scam or wasting your valuable time on something are very slim.
Now read on to discover the truth about the Nu Skin MLM platform…
Company Name: Nu Skin
Founder: Blake M. Roney
Price To Join: $25
My Rating: 5/10
~ Nu Skin Reviews ~
Intro…
I still can’t believe just how many businesses and companies are going the multi level marketing route these days. It seems to be more popular than ever before.
I’ve actually written quite a few reviews of network marketing opportunities on my site here, so when the Nu Skin platform came to my attention very recently, it sounded like a good one to dig into and write a review on.
I believe reviews are one of the best ways to discover worthwhile opportunities, and also one of the best tools to be informed of obvious make money scams. The whole reason for my website is to help others find some good options for part-time or fulltime money. That’s why there are so many reviews of training schemes and make money products on here.
I’ve always wanted to be able to make a fulltime income from home, and these days that’s exactly what I do. And it’s all thanks to the internet. I don’t even work fulltime to make that income either.
It seems just about everybody is looking online for options today, and the scammers of the world are aware of this. They make up awesome sounding schemes that deliver nothing of value and are just designed to get money off people. We must always be diligent.
Anyway, let’s now see if the Nu Skin MLM scheme offers any real value.
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What Is Nu Skin About?
With its headquarters in Utah in the United States, Nu Skin was founded way back in 1984 by Blake M. Roney. These days the products and business opportunity are available all around the globe.
The company distributes a range of skincare and anti-aging products and uses the multi level marketing method to do so.
Over the years the company has encountered some controversy, being accused many times of being an illegal pyramid scheme. They’ve also been in trouble for misrepresenting the income distributors can earn, having been caught lying about it on their income statements.
Some dubious and misleading marketing approaches has been another common complaint and cause for concern for the company.
But all the legal issues and controversy aside, the company is still going strong to this day and doesn’t look like disappearing anytime soon.
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The Nu Skin Products
My reviews of MLM opportunities are always more focused on the business side of things and whether decent money can be made. I always briefly mention the product line, but don’t dig deep into it.
If you want complete details on the Nu Skin products, click here to visit their website.
There are actually quite a few products in the Nu Skin range, so there is some diversity to try for yourself or sell to others. I won’t list them all here, but I will make a quick list of the main categories for easy reference:
-
Essential Oils
- Cosmetics
- Peels & Masks
- Skincare
- Health & Wellness
- Weight Management
- Oral Care
- Body Care
- Hair Care
- Vitamins & Minerals
- And others…
The products do seem to be well received on the whole. Of course, anyone promoting Nu Skin will say the products are the best, but Nu Skin products are actually available on Amazon, and the reviews for them there seem mostly positive.
They are quite expensive though, as is almost always the case with MLM. I explain why in the next section.
As an example, a bottle of 180 Vitality Dietary Supplement Pills costs $73, so not cheap.
Why Are MLM Products So Expensive?
Network marketing products are not more expensive because they’re so much better than everything else out there on the market. And it’s not because they contain ingredients that nothing else has.
The reason they are more expensive is because of the MLM compensation plan and massive overheads.
Multi level marketing is all about building sales teams and downlines. Someone down below sells something and a whole line of people above them all earn a commission. And then the company also has to make a profit.
This all adds up to astronomical prices just to cover expenses.
That’s just how MLM works.
Now of course no distributor of the company itself is going to admit this, because it just sounds like you’re getting ripped off, but that’s the real reason why the prices are always so much higher than competing products on the market.
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The Nu Skin Compensation Plan
Let’s now get right into the business side of things and see what the Nu Skin compensation plan has to offer.
Generally there are two primary ways that distributors earn money with any MLM opportunity, and those two ways are:
- Direct sales of the company’s products
- Building downlines and earning commissions and bonuses
For selling products directly to customers, you’ll make yourself a 25% mark up, which is pretty good. Likewise, when you buy any for yourself, naturally you get a 25% discount.
For sales through your downline, you’ll earn 5% residual commissions.
Selling the products is okay, but it’s not the right plan to really make a success of a MLM venture. The way to get ahead can only happen with mass recruiting and building your sales teams.
This gives you group sales volume, which then helps you reach bonuses, as well as climb the company ranks. It’s the climbing the rank ladder that’ll put you in a position to make decent money.
You just can’t really do that by simply selling the products alone.
You can check out the official Nu Skin compensation plan PDF here.
To help explain things further, I’ve embedded the Nu Skin comp plan video below.
Is There An Income Disclosure Statement?
Yes, there actually is, and I like to include a few details from these so you know the kind of money people are actually making when you join.
The most recent income disclosure for Nu Skin that I could find is for 2016.
So here’s the deal. The average annual earnings for a base level distributor in 2016 was just $384, and that’s before taking into account any business expenses.
In fact, to reach a level where the average yearly income is what I consider to be liveable, you need to rank as high as Emerald Executive, which is only 2 ranks away from the very top and hard to reach.
You can view the 2016 Nu Skin income disclosure here.
The Reasons Why I’m Not a Fan of MLM
I now want to break down the reasons why I’m really not a fan of the MLM way of doing business. All the benefits go to the company, while the story for the distributors is very different.
People are often attracted to MLM because of the hype. They know how to sell the deal to people and many are easily hooked. The hype often hides the reality of how the system works.
There is a very good reason why network marketing is so popular with businesses in the modern world. Because there are just so many advantages for companies to move their products with this format.
While Nu Skin will have employees on the payroll, the majority of people who work for network marketing companies don’t get paid anything. And that’s the army of distributors. None of these people get paid wages or even a retainer.
Everything is done on the promise of commissions and bonuses, and generally the distributors actually have to pay the company for the right to work for them for free.
I mean, what kind of deal is that, where you pay the company so you can work for them?
All you really are as a distributor is a rep of the company, except you pay for all your own working expenses and don’t get compensated for anything. Distributors are the ones running around selling the products, promoting the company, all for free and all at their own cost.
The only thing you earn, somewhere down the track, is a commission or bonus.
Essentially you don’t get paid anything, do most of the work, cover all your own costs, and then have to pay the company for the right to do all of this.
WTF??
When you start pulling it all apart, these schemes are a rotten deal for the lowly distributors.
Let’s continue, because there’s more.
I mentioned earlier that the real way to get anywhere is to recruit people. So because of this, distributors are also the ones growing the company and expanding its reach with new members. This is also done for free and at your own expense.
The company grows bigger, more distributors are buying and selling products, promoting the company and also paying membership fees.
This has to be the deal of the century for companies when they adopt the network marketing business method.
So why is MLM so popular then?
Hype is the reason.
I said earlier these companies really know how to sell the dream. This includes things like having money, trips to exotic locations, big houses and fast cars.
Of course, there’s nothing wrong with going after these things, but less than half of one percent of people involved in any MLM deal ever achieve this kind of life through MLM.
Despite this miserable statistic, MLM is almost always sold like a get rich quick scheme.
These companies also draw people in with the promise of owning your own business. This isn’t true either. You never own a business. The company owns everything. The company controls everything. The only thing you’ll own is the products you buy.
At the end of it you have no business asset, you haven’t built your own brand. If you leave, you simply wander off empty handed. You can’t sell your MLM distributorship. Doesn’t happen.
Like I said, distributors are just sales reps who work for commissions and bonuses, pay their own expenses and never actually own their own business.
MLM companies also turn their distributors into their main customers by making them buy a certain amount of products every month to remain eligible to earn.
Nu Skin adopt this tactic that I really despise. To remain an active distributor, not only do you pay a joining fee, but you have to buy around $100 worth of Nu Skin products every month or you’ll forfeit your earnings.
See how these schemes make their workers also their main customers?
It totally sucks!
These are the reasons why I never recommend MLM as a good way to make money.
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Is Nu Skin A Pyramid Scheme?
MLM companies are always being accused of being illegal pyramid schemes because of their pyramid style of compensating members.
This is almost never really the case though.
An illegal pyramid operation is one that has no products to buy and sell and relies totally on recruitment. New money coming in through new recruits pays the profits of existing members and the company itself.
These are known as “naked” pyramid operations.
Nu Skin has loads of products and is not a naked pyramid scheme, so it can’t be classified as an illegal scheme in that way, despite heavy recruitment.
Target Market
Probably one of the biggest drawcards with any MLM deal is the ruse they sell by telling people they’ll have their own business.
Many people want to get involved in something they feel is their own gig, but they don’t want to have to do all the set up.
MLM is the answer because everything is all there and ready to go. All you have to do is buy in and get going.
The dream of owning your own business lures people in, even though it’s not even true. It all sounds simple and it’s also sold to you like you’ll be making decent cash in quick time.
Yeah right.
Some people do well with MLM, but the percentage is tiny compared to the masses who fail to even turn a profit.
What I Do Like
- Nu Skin has been going strong since 1984
- They have quite a decent range of products to sell
- People seem to quite like the products
- The opportunity and products are global
What I Don’t Like and Red Flags
- MLM is one of the hardest ways in the world to make a decent, consistent income
- Less than half a percent of people make a decent living in Nu Skin
- The average yearly earnings for a distributor at Nu Skin in 2016 was less than $400
- You never own your own business, despite what they try to tell you
- All the advantages go to the company while the MLM deal totally screws the distributors
- All of the products are typically expensive
- You have to purchase a minimum amount of product every month to remain an active distributor
- You have to pay the company for the right to work for them for free
- Nu Skin has been involved in a number of legal battles and controversies over the years
How Much Does It Cost To Join Nu Skin?
There is a $25 joining fee to become a distributor for Nu Skin. After that, you must agree to purchase a minimum of $100 worth of Nu Skin products every month or you can’t earn bonuses and commissions.
Is Nu Skin a Scam or Legit?
Nu Skin is not a scam, despite having its fair share of controversy and legal troubles throughout its history.
It’s just your classic MLM scheme with products selling at expensive price points and a compensation plan that fully favours the company and not its mass army of workers.
There’s nothing wrong with it as such, but if you were to join, all your efforts need to be focused on recruiting rather than selling, as that’s truly the only way to advance into the higher money brackets.
There is no other way.
For most people, joining this will just end up costing money and sucking up loads of your time for little to no reward.
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