Thursday, March 5, 2015

A puzzle for the next ten days...

I am just about to get on a plane to China and Hong Kong - so I will be away for a little while.

However I have a puzzle for all you Herbalife junkies out there... and it might require you do some research.

Imagine you were the very first Herbalife distributor and you recruited three people and they - eventually and through their downline - recruited the millions of people who now consume and/or distribute Herbalife.

And also presume you did nothing else for the rest of your career. You just sat there and collected the "recruitment rewards" or the "royalty checks".

Roughly how big would your income be now? And from how many levels would you be collecting your income?

Answers either by replies to this post or by email.



Anonymous said...

"Up to three subordinate levels can contribute to this amount" on the royalties.

unlimited income potential on any direct retail product sales distributor makes adds additional to royalties.

Anonymous said...

Zero $, your 3 downline members, assuming they are active, will "block" you and you won't earn any bonus.

Anonymous said...

Who cares?

Anonymous said...

presume you did nothing else


Unknown said...

Nothing, Zip, Nada, Zero, $0.0.

Congratulations, Mr. Hempton, you sure got all us anti-Herbalife/MLMers, hunh!

But wait! I bet you know there's more to the story, as do I.

I guess your hypothetical top distributor would have to continue generating downline purchases in order to make money. Let's see. How would a rational distributor driven by Herbalife's/MLM's pay plan at any level do that?

Oh yeah. They'd help their downline distributors who had to generate qualifying volume purchases (that's purchases, not sales) in order to recruit downline distributors who would also have to generate qualifying volume purchases in order to recruit . . . and on and on and on.

Wouldn't this means that the residual income/retirement security pitched to distributor prospects with Herbalife's complicity is male-bovine excrement?

Plus, being at the top she/he could make a ton o' dough by SELLING their recruiting systems (excluding lead generation system, which the company expressly forbids in its nominally-enforced rules) to credulous downline recruits. Of course Herbalife would never support those system sales by urging low-level recruits to duplicate their uplines' "proven" systems, would it?

Gee, Mr. Hempton. It sure looks to me like Herbalife is a product-masked pyramid recruiting scheme. Is that illegal? Of course Herbalife would never consider thinking about the possibility of maybe actually doing this stuff, would it? Aren't those shenanigans all the doing of rogue INDEPENDENT distributors? Doesn't the company escape even vicarious liability for it? Should be smooth sailing for Herbalife through the ongoing government investigations, right?

If I'm right, do I get a prize? If so, please, please, please, make it an F1 shake. I can't seem to get my hands on one without disclosing private information to a distributor I've never met, or buying illegitimately-sold product on Amazon or eBay.

Oh, BTW. What was the point of this puzzle?

CrocodileChuck said...

"The greatest shortcoming of man is failure to understand the exponential function"

Thomas Sewell said...

You wouldn't be making any income. If you don't buy or sell any product, you don't collect any income from downline sales.

Anonymous said...

John - you might get a better response if you first tell us why we should care. Not being sarcastic or critical, just don't think you'll get more than shoulder shrugs on this.

Tom Salvatore said...

Your income would be exactly what Herbalife income is .... because Herbalife is Distributor #1 (it was owned by Mark Hughes). I'm not sure if he recruited three, or more than three in the initial downline. No one is debating, it is highly profitable to be Distributor #1 in a big Pyramid Scheme. Mark Hughes knew that. So did Golden Gate & JH Whitney, but they bought with bank money and tiny sliver of OPM equity, then quickly took out a dividend equal to almost their entire equity, and in less than 2 years flipped the hot potato to the public. Jorge Vergara (a very early Herbalife distributor, founder of infamous Omnitrition, now renamed OmniLife) also knew it was better to be Distributor #1 than #5-10 so he quit Herbalife and set up the pyramid scheme Omnitrition as a copy of Herbalife pay plan. Vergara is a multi billionaire now.

Anonymous said...

Weight Watchers hitting new lows...stock is at $9 down from 30 a few months ago...the problem? The "meetings" where people get support are becoming obsolete. Fitness trackers and online services do it better for less. And we are to believe that people pay 100-200% the cost of alternative products to be "coached" by an unqualified HLF distributor? C'mon Mr. can do better than that.

Mongol said...

Pretty much just the Mark Hughes bonus. The Mark Hughes bonus for US would be $15MM last year and the "Mark Hughes" of China would have got around $7.5MM. But what's your angle?

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