Monday, July 24, 2017

Does Melaleuca’s success = distributor success?

Melaleuca is a health and wellness direct sales company founded in the rural state of Idaho.

They skyrocketed years ago, and managed to keep on trending all the way through the 2000s. Recently they’ve hit the coveted $1 billion mark in sales.

So have I been involved?

This video explains everything:

Make sense? Either way, here’s the full review on Melaleuca.


When Melaleuca got started some 30 years ago, they were just a humble little start-up company in a small town in Idaho.

Those days are long gone. They quickly became a multi-billion dollar company with operations in almost 20 countries worldwide. These guys bring in a million shoppers per month.

And in 2015, their annual sales broke the $1 billion mark. That’s HUGE. They did $1.75 billion in 2016, making them one of the top MLMs in the world.

Their tagline is “The Wellness Company”, and they want all of their endeavors to cover four areas of wellness – a more holistic approach, we’ll say. The four aspects are your physical health, your financial well-being, your overall quality of life, and the greater well-being of the environment.

Frank L. Vandersloot started Melaleuca way back in 1985. He’s been a successful salesman his whole life, but as he started to age, he decided that he wanted to start letting someone else do the grunt work for him. So he built up a team of part-time salespeople and started an MLM. Well played, Mr. Vandersloot, well played.

Frank Vandersloot injects Melaleuca with a refreshing dose of humility and frugality when MLM is known for arrogance, over-the-top events, and fancy car bonuses. He’s known for preaching to his employees the value of living within their means, not going into debt, and not buying cars and houses they can’t afford.

He even discourages his distributors from pushing new recruits into a mountain of debt by purchasing tons of inventory and training programs. I can get behind that.

How much does Melaleuca cost?
There’s a one-time membership fee of $29. You also have to buy about $80 in product each month to keep an active membership and qualify for commission.


Melaleuca health and home products have always been centered around offering environmentally friendly options to everyone. Of course, “environmentally friendly” usually comes with a higher price tag.

The list of Melaleuca products is longer than the line up outside of a Chick-Fil-A drive through at lunch time. Seriously, the amount of products they sell is ridiculous. Then again, they have been around for over 30 years.

Their catalog can be broken up into the following categories: Nutrition, Medicine Cabinet, Beauty, Household, Bath & Body, and Essential Oils. Your one stop shop for all the MLM favorites.

Some of their most popular products include Peak Performance Total Health, a nutritional supplement that supports your workouts and is actually clinically tested (congrats), their Renew intensive skin therapy lotion, and their eco-sense laundry products. The only way to see their prices is to log in to a member account.

They offer a membership money-back guarantee that allows you to terminate your membership up to three months after purchasing it and get your money back, and you don’t even have to give them a good reason. So signing up for their shopping membership is worth a try, even if you end up not really digging it.

Compensation Plan

The Melaleuca compensation plan, also known as their “Business Builders Plan”, isn’t half bad. However, it is way WAY more confusing than it needs to be. Smells like MLM.

Don’t worry, I’ll try to parse out the details and break it down easily for you.

The most important stream of income is the purchases your customers and recruits are making. You get a residual income on all of their purchases, so if they shop on the platform regularly, that can add up. You get 7% of their monthly spend.

If you are the Enroller, you can earn 20% on your new customers first 150 product points purchased, and if you’re that person’s Enroller and immediate Marketing Exec, you can earn 27%.

Your 7% in residual commission isn’t huge, but it stays flat straight through your downline. It doesn’t decrease, which is a pretty good deal. You get 7% off of your 1st generation, 2nd generation, 3rd generation, etc. This goes 7 generations deep.

You can also earn bonuses for enrolling Quality Customers. Quality customers are people who enroll, become Preferred Customers, and make the necessary minimum purchases within their first month.

Weekly Melaleuca bonuses are given out to anyone who has kept their Preferred Customers enrolled through the past 5 months. If you’ve managed to retain 75% or more of your Preferred Customers, you can qualify.

Finally, Melaleuca gives out some pretty good Leadership Development Bonuses for those who are building up a solid team of distributors who sell a lot and move up in rank. Each time one of the distributors in your downline gets a rank bonus or sales bonus, you get a bonus that’s equal to 50% of their bonus.

Like I said, the compensation plan is way too convoluted, lol. Usually, when MLMs do that, it makes me wonder what they’re hiding.

Looks like Melaleuca is hiding their income statistics. If you take a look at them, they aren’t exactly encouraging.

The average annual income of their Directors (and many new reps don’t even make it to Director level), is $2,047. These are distributors who have worked at building their business for quite some time and already have 8 customers or more. Many people won’t even make it that far.


Melaleuca has a pretty impressive backstory, especially if you remember back to the early 2000s when they really started to take off. But they haven’t slowed down – hitting $1 billion a couple years ago was their greatest milestone yet.

The company might be doing great, but most of their distributors are not. Sorry folks, but the numbers don’t lie.

Of course, if you’re into their products, it could be a fun gig to do on the side. Just don’t expect it to pay the bills.

If it’s financial freedom you seek and you like automated ways to build passive income, there are better ways.

(and you can trash those old MLM habits, too)


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