Melaleuca was founded in the mid-1980s. Its main products fall under the wellness category. You have a choice from hundreds of items. Is Melaleuca wellness company a scam? Let’s answer the following questions to figure out the answer.
- Do their products offer benefits over and above what are available in stores?
- Are they of exceptional value?
- Can you make decent money with their MLM business opportunity?
Yes, Melaleuca sells its products through multilevel marketing (MLM). Let’s dive in.
The four main categories of products are:
- Home cleaning and laundry
- Supplements and foods
- Personal care and beauty
- Pure essential oils
Do The Products Offer Benefits Over Store Bought Equivalents?
Melaleuca claims that they spend millions of dollars in research each year to find safe, natural extracts, essential oils, minerals, enzymes, and other natural compounds that are used to manufacture their products. They are all eco-friendly and biodegradable.
Of note, they do not use chemicals like chlorine, ammonia, abrasives. phosphates, parabens, and other harmful ingredients in their products. The Australian tea tree oil figures prominently in many of their products.
Overall, you have a choice from hundreds of items. Single items range in price from a few dollars to about fifty dollars. Many are grouped in packs designed for specific uses, These packs can cost well over a hundred dollars.
I would class Melaleuca’s offerings as premium quality not too different from other MLM home and personal care companies that have similar products. The unique ingredient is the Australian tea tree oil, called melaleuca. You can learn more about this natural compound via this Medical News link: Tea Tree Oil.
Do their products offer benefits over and above what is offered in stores? I’d say yes. May years ago I used to be a distributor for a similar kind of company called USANA Health Sciences. Hence this conclusion is based on prior experience with a premium health and wellness company.
My conclusion is the Melaleuca products do indeed offer benefits over and above what you get in the typical retail store.
Are The Products Of Exceptional Value?
Although the Melaleuca products cost more than similar types of products in most stores, it is difficult to do a direct comparison. When you compare the cost with products made by other companies that are unique and environmentally friendly, the cost is on par.
Are they of exceptional value? Melaleuca states that 82% of their products are sold to customers who are not involved in their MLM business. This is a good sign because this status demonstrates customers are loyal and feel that they are getting exceptional value.
People who are not involved in the business have personally informed me that they really love the products. With the information I have reviewed I am willing to conclude that the Melaleuca products are of exceptional value.
Can You Make Decent Money With The MLM Business Opportunity?
Only a small percentage of its distributors make any decent money. This is typical of all MLM companies. Why is this so? There are many factors. I have concluded that the biggest challenge is related to the MLM business model. Selling the products is not enough to generate a decent income.
A significant percentage of one’s income is generated through the people you recruit into your team, also called your downline. The products they purchase as well as the products that are sold through them factor towards your commission. Every company has its own formula used to compensate its distributors, and Melaleuca is no different.
The problem new distributors face is to recruit others into their team. Then train them to generate sales. Followed by training them to recruit others. It doesn’t end there. You also have to train them to duplicate this process. Meaning they have to recruit and train others too. This takes more effort than new recruits realize.
All MLM companies spend a large part of their budget in holding meetings and conventions where they have the opportunity to train and motivate their members. Even so, the strain of building a business in this way is too great for most recruits. The direct result is rampant attrition. Those who want to maintain their income have no option but to work hard on recruiting and training new members.
The promise that if you just duplicate the system and never give up, you will get rich ends up being a pipe dream for most. I shall provide details on what distributors of various seniorities get paid in the following section.
How You Get Paid
Melaleuca has two documents that help to explain how you get paid. The first is the pricelist. The second is the compensation plan. Your income is dependent on the sales you make as well as the sales made by your downline.
Melaleuca Pricelist from Jan-Mar 2019
The following price list is used for illustration purposes only. For the latest pricelist, please visit the Melaleuca website. Click the graphic below to access the price list in PDF form.
Notice that each product line item has three columns. The regular price. The preferred price. And the points associated with that item. They all factor into how much money you can earn. These details are provided in the compensation plan shown in the next section.
From my experience, the retail prices are on the high side. The price for preferred customers (those who have automatic monthly purchases) is on par with other MLM companies selling similar products.
Melaleuca Compensation Plan
The first method to earn money is to purchase the product at the preferred price (wholesale) and sell it at the regular price (retail) and keep the difference. As a distributor, you can personally purchase products at the preferred price. Click the graphic below to access the Melaleuca Compensation Plan.
What Do Melaleuca Distributors Typically Earn?
On average, not much. Here is where Melaleuca gets disingenuous. In any MLM company, most distributors earn very little. Melaleuca addresses this low performance by defining a specific group of members as Product Advocates. They class this group as being primarily customers who just happen to recommend the products to family and friends. When they make a purchase, the Product Advocate earns a commission. The following screenshot shows what their earning levels are:
There are three levels of Product Advocates based on the number of customers they have referred to Melaleuca. Note what the average annual income is. As well as the range of time it takes to earn in income. Only 9% of all customers earn a part-time income in this way.
What about the rest? Melaleuca states that those who are serious about building their business rise to the level of Initial Leadership Status. Meaning, the Director level. The following diagram shows the typical earning results of the various director levels.
Director levels can earn commissions dictated by the Advanced Leadership Status. Details are provided in the following diagram.
Look at the last two columns on the right. See that the time span to reach these levels of income varies by a large margin. When you see progress made in such a short time like one month, the chances are these distributors already had a downline in another program and were successful in bringing them along. The longer time span is usually achieved by working hard over many years. 267 months or 22.5 years to be exact! How long do you think it will take you?
Melaleuca will not make most of its distributors wealthy. In fact, the odds of you making any decent money is very low. Is that what you really want to do?
There is a better way to build an MLM business that I will share later. It doesn’t involve attending meetings, recruiting your family and friends, and buying a ton of products to sell retail. Stay tuned till the end.
Melaleuca Pros & Cons
- High quality products that have developed a loyal customer base
- You have a wide range of products to choose from in four distinct categories detailed above
- They have been in business for over 35 years that engenders long term product availability
- Very hard to make money consistently if at all
- You can purchase Melaleuca products on Amazon for less – this weakens the distributiors ability to find customers
- When preferred customers try to cancel their subscriotion, it is very hard and frustrating to accomplish
I am certain there are other pros and cons you can find. The above list is what I deem the most compelling.
The time has arrived to answer the following question:
Is Melaleuca Wellness Company A Scam?
Based on what I have revealed to you what is your conclusion? I base my opinion on the fact that Melaleuca sells genuine products that do fulfill a mission to help its customers maintain good health through products created from the melaleuca tea tree oil. From that perspective, I don’t feel the company is a scam.
However, for me, the jury is out regarding the business side. Most MLM companies, Melaleuca included, clearly state that their income projections are not guaranteed. Those who achieve significant annual income, say in the high five figures and above, have worked very hard to achieve what they earn. And that those who do not, have not worked as hard or smart.
This means that about 95% of its distributors must be lacking in the skills to succeed. The company takes no responsibility for people who make little or no money working the business. It is stressed that the income earned by distributors is directly related to how hard they are willing to work their business.
I believe that the compensation plan is set up to generate a high volume of sales for the company, even though this will involve a high distributor attrition rate. All that matters is that its members purchase the product. Even if they do not sell to others, or recruit new distributors. To me. that is a scam. A legal one perhaps. But still a scam.
Can You Succeed In MLM Differently?
The evolution of technology today enables entrepreneurs to reach thousands of customers through Internet Marketing. There is a business model called Affiliate Marketing. Simply stated, most companies enlist the efforts of individuals called “affiliates” who they authorize to direct customers to their online stores using affiliate links. The most common methods are to share product reviews and comparisons with those searching for information with the intention of buying.
Affiliate marketers learn skills to use the Internet to find these customers and channel them to the companies they are affiliates of. When a sale is made, the company will pay the affiliate a commission. This is usually a percentage of the product price.
I wrote an article explaining in detail how this works that you can access via this link:
In this article, I share with you my recommendation to create an online business where you will not have to bug your family and friends to generate an income, 24/7.
To learn more about how to use the Internet to build your Melaleuca business click this link: MLM Online
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If you are a Melaleuca Distributor, I would love for you to write comments below on your experience with the company. Are there any areas do you feel I was spot on? Or unfair? Regardless, I honestly believe that you can learn to build your Melaleuca business online more effectively using the training, mentoring, and tools available on the Wealthy Affiliate Platform.
If you are considering joining Melaleuca as a distributor, why not get a head start on learning the skills to use Internet Marketing to get a head start over others? The techniques used are based on affiliate marketing.
No matter what you do, I wish you much success in learning to improve your life and that of your family through entrepreneurship.
Looking forward to hearing from you.