Top 5 MLM Companies Review – A Quick Comparison of the Industry Leaders
In this article we take a quick look at the network marketing industry heavyweight contenders. We review the features, advantages and disadvantages of the top 5 MLM companies based on their popularity. The measure used to determine the most popular is simply Internet search traffic volume. Although these may not necessarily be the best reason for any person to join, we thought it would be useful to know a little about these companies that are attracting most attention in the online world.
The basis of our analysis is Mark D Worthan’s Best-MLM-Opportunities.com which uses Google search statistics. His analysis is based on Google Trends, which is a service from Google Labs that allows you to compare the number of searches for various keywords across time. The service can be used to determine the relative number of searches for various MLM companies. Here are the results from current data, along with a short overview of each company:
- Amway– Amway was founded in 1959 when its founders signed up to become distributors of Nutrilite vitamins, and is famous for “legitimizing” the network marketing industry in 1979 when the FTC found that Amway does not qualify as a pyramid scheme. The FTC ruling was due to the fact that its compensation system is based on retail sales vs. payments for recruiting.
Amway reported sales of $8.4 billion in 2009. Amway North America was closed in the early 2000’s and most North American distributors joined sister company Quixtar, but still continue to order Amway products. At that time, the average monthly earnings for “active” Independent Business Owners was reported to be $115. Advantages of Amway/Quixtar are its widespread name recognition. The main disadvantage reported by many is its older style compensation plan which makes achievement of full-time income problematic.
- Herbalife – Herbalife was founded in 1980 and reported net sales if $2.3 billion in 2009. Over the years Herbalife has faced occasional legal challenges over the safety of its products, none of which has yet been upheld, although the company settled with the California Attorney General in 1985 for $850 million over making inflated product claims. The company’s product formulations were changed to eliminate Ma Huang in 2002 when several US states banned the use of ephedrine alkaloids. In 2007 a scientific study at the University Hospital of Bern Switzerland and Israeli hospitals found an association between consumption of Herbalife products and hepatitis. These items and other media and legal settlements seem to be the company’s main disadvantages.
- Mary Kay – Mary Kay was founded in 1963 as a skin care and cosmetics products company, based initially on a recipe from a tanner. Worldwide sales were $2.5 billion in 2009. Brand recognition is the main advantage of this company, which obviously appeals more to women than men. A high per annum turnover figure has been calculated for both US (68.6%) and Canadian (85%) consultants. Earnings figures reported for Canada were that of 29,675 consultants, only 1878 earned more than $100. 276 of the 553 Sales Directors earned more than $17,471 and 15 of the 23 National Directors earned more than $100K, indicating a steep climb to significant earnings potential.
- Pampered Chef – Pampered Chef was founded in 1980, based on using the party plan to market cookwares through in-home demonstrations. The company was acquired in 2002 by Berkshire Hathaway Corporation. Earnings figures are unavailable.
- Monavie – Monavie is a beverage company distributing products made from blended fruit juice including freeze-dried acai powder and puree. The company was founded in 2005 and was recently ranked eighteenth on Inc. magazine’s 500/5000 ranking of the fastest growing private companies in the US. Company claims of effectiveness of its key polyphenol antioxidants have been blunted by the FDA, Linus Pauling Institute, and European Food Safety Authority which state that such compounds have little or no value following digestion. A Newsweek article reported only 10% of distributors made more than $100 per week and the 2008 dropout rate was around 70%. Despite these and clinical reports of adverse effects, the company remains highly popular within the network marketing community, due to its more up-to-date and potentially lucrative compensation plan, although a 2010 mlmwatchdog.com editorial reports a recent decline in popularity due to recent compensation plan changes.
We don’t necessarily recommend or advise against joining any of these top 5 companies, but merely wanted to look at a few facts about them. We find that few people take the time to look at what companies are available in the home based business realm. If evaluating home business opportunities, it is advisable to get familiar with the industry, establish some selection criteria and make an informed, unemotional choice. One thing to note is that strong emotions often come into play in the “buying” process of selecting a home business opportunity and after the fact justification of decisions made emotionally is very common.