Is Yoli a pyramid scheme?
People working for them claim that the business opportunity is amazing because there is lots of profit potential as well as potential to help others live a healthy lifestyle… But what about all the recruitment that is going on?
The recruitment side to this business is what leads many to believe that it is nothing more than a pyramid scheme, and I’m going to discuss this in detail. The truth is there is a lot about this business model that does resemble a pyramid scheme, but the answer to whether or not it actually is one is more complicated.
In this review I’ll be going over how this business works, the compensation plan, whether or not it is a pyramid scheme of course, and a few things that people recruiting you and are not going to tell you… But I will.
Yoli is what you call a MLM, or multilevel marketing business, that operates in the health and wellness industry. They sell a variety of different products with focuses on things like…
- Balancing pH
- Supressing appetite
- Enhancing digestions with enzymes
- Supporting immune system with probiotics
- Protein for building lean muscle
- Joint health
These products are often sold in kits, such as the alkalinity kit which features a bunch of products for balancing pH, the energy kit which is all about boosting your energy, and so on.
One thing that is for sure about these products is that they are pretty expensive. Now whether they are worth the value or not is debatable, but there is no doubt there expensive… I don’t think anyone can argue with me on that. If you are someone looking for affordable options then this probably is not for you.
However, I am guessing that you are more interested in knowing about the business opportunity, which is where there is all that recruitment going on. To learn more about this I will go over the compensation plan and how members of Yoli are getting paid.
The Compensation Plan
In order to be able to earn money from the compensation plan, you have to be at least in active member. This means you have to generate at least 50 PV (personal volume) every four weeks. You can generate this by either personally buying products up to 50 PV or selling products to others. However, being an active member still won’t give you access to the full compensation plan. You are also going to want to be a “qualified” member and to achieve this you will need to recruit in at least two members.
Fast Start Bonus
The Fast Start Bonus is exactly what it sounds like… It is a bonus designed to give you fast commissions. This bonus is paid when you recruit in new members, which you will earn 20% commissions from their order.
Bonuses like this are typical with MLM businesses. It seems that everyone has their “fast start bonus”. Two other MLM’s that have this bonus which come to mind include Aegea and Visalus, which are both other health and wellness MLM businesses by the way.
You will also be able to earn retail commissions, which are commissions from products that you personally sell. You will be able to sell products directly to other people on hand, or you can send people to buy products through the Yoli website with your ID number and you will get credit for the sale.
The amount you will make will be the difference between the wholesale price in the retail price. Just to give you an example of what you are looking at here, the transformation kit wholesales for $285 and retails for $340. So if you were to sell this you would make a $55 profit
And of course they have a binary structure in place, in which you get paid based on sales generated from your team.
A binary structure is one that has two open positions below each person. So below you there are two people, below each of those two people there are two people, and so on. At each level it branches out by a multiple of two. You can refer to the diagram below to see what I’m talking about here.
Sales volume is calculated each week and you get paid commissions based on the sales from the lesser leg, meaning the side (right or left) that generated the least amount of sales volume. The reason for this is because it gives members incentive to build up the lesser legs and balance things out, which is done by everyone in the downline working together as a team.
In addition to the binary structure, there is also a uni-level structure in place, which you can also see in the diagram above. With the uni-level structure there are unlimited positions at each level that can be filled. The people that you directly recruit in make up your level 1, the people that they recruit in make up your level 2, the people that those level 2 members recruit in make up your level 3, and so on.
As you can see from the table below, it is possible to get paid down to 10 levels in depth, which is a heck of a lot.
Moving Up The Ranks Is Very Important
If you want to make good money then it is very important to move up the ranks. Moving up the ranks allows you to earn larger commissions and allows you to earn from many more people in the downline.
So how do you move up the ranks? What it mostly comes down to is recruitment. To move up the ranks you are going to want to recruit more people in generate higher group volumes.
This is pretty much the gist of the compensation plan. There are other parts to it, such as travel incentives and a luxury car program, which every MLM seems to have, but what I just went over covers most of it.
Pyramid Scheme or Not?
Okay, so here we have a compensation plan that is very focused on recruitment… Pretty much your typical MLM compensation plan. But is this a pyramid scheme?
The truth is that just because there is a lot of focus on recruitment does not make this a pyramid scheme. What I would need to look at to determine whether or not it is one would be the cash flow… Where all their revenue is coming from. Is it mostly coming from recruiting new members and? Or is it coming from sales to the general public?
The difference between pyramid schemes and legitimate MLM’s is that pyramid schemes focus too heavily on recruitment and that is where the large majority of their revenue comes from, whereas product sales to the general public are put on the back burner.
Unfortunately I was not able to find any information showing how many sales come from where, so I can only assume that this is a legitimate MLM.
What No One Tells You
Legitimate MLM or not, there is still a big downside to any MLM out there.
The problem is that a very small percentage of people involved in the source of businesses actually make good money. Some reports say that around 95% of people fail and this is a believable number.
The problem with MLM structured businesses is that they have a pyramid -like structure where money is sucked away from those at the bottom and funneled up to those at the top. This leads to a very uneven income distribution where the few members of the top are earning most of the money, while those at the bottom are struggling.
Conclusion – Good Opportunity or Not?
Whether or not this is a good opportunity really depends on you. The bottom line is that if you want to make good money in a typical MLM business like this, you are going to have to be darn good at recruiting in new members. Recruiting in new members is what you are rewarded from the most in the compensation plan so this is what you are going to want to be doing. And don’t think that you can just recruit some people in every now and then. MLM’s like this have very high turnover rates and because of this you will have to recruit people in continuously to really make it.
So it all comes down to how well you will be able to recruit… For the most part.
Personally, I stay away from MLM’s because of their difficulty in because that is when be good at recruiting anyone in, but the choice is yours.
Since you are looking to make money on your own time, with your own home-based business, I would suggest taking a look at how I make a living online if you think this MLM thing isn’t for you. I have been working online since 2015 and have been able to go full-time with it. You can learn more and learn how you could get started doing the same by clicking the button below:
Questions or comments? Please leave them down below and I’ll get back to you as soon as I can 🙂