How much can you earn with MLM Tropic Skincare?
Thinking of becoming an Ambassador for MLM Tropic Skincare? Find out how their Success Plan works, and how much you can earn.
So how much money can you earn working as an Ambassador for Tropic Skincare? As you’ll discover, it’s not an easy question to answer.
But, before we look at the Tropic opportunity specifically, it’s worth asking a bigger question when evaluating the direct selling marketplace as a whole.
Is the MLM industry dying out?
And that question is: is it a good time to get in on any MLM right now, or should you steer clear?
Because, from what we can tell, the signs aren’t looking good for the MLM industry at the moment. In the US, the Federal Trade Commission (FTC) appear to have MLMs in their sight:
- In 2016 the (FTC) fined MLM Herbalife $200 million, saying that their compensation structure was unfair because it “rewards distributors for recruiting others to join and purchase products in order to advance in the marketing program, rather than in response to actual retail demand for the product”.
- Earlier this year they went one step further, fining another MLM, Advocare, $150 million (and fining two of their top reps) and banning the company from operating a network marketing business. They also labelled Advocare a “pyramid scheme” and a “scam”.
- The FTC have also just announced they’re suing MLM Nerium, alleging the company “operates as an illegal pyramid scheme and falsely promises recruits they will achieve financial independence if they join the scheme”.
And the signs are that they may not stop here. Employees from the FTC apparently contacted the producers of the podcast The Dream, to say they were listening to and enjoying the podcast which explores the history and workings of the direct selling industry, and are ‘ready to reassess the way they’ve been handling MLMs’.
And as William Keep, a marketing professor at the College of New Jersey told Forbes:
“The more the FTC successfully demonstrates the ability to prosecute a firm for a pyramid scheme in this industry, the higher the probability that the next firm could be prosecuted. Because they all fundamentally use the same model.”
‘The direct selling industry is in decline’
It’s not just the FTC putting MLMs under the microscope. Truth in Advertising (TINA) recently published an article claiming that the direct selling industry is in decline. They note that the number of companies leaving the Direct Selling Association (DSA) is outpacing the number joining it.
They also observe that cases against MLMs are beginning to stack up. Between 2008 and 2018, the FTC pursued four cases alleging MLMs were pyramid schemes (and as we’ve read above, they’ve since launched more). And between 2017 and 2018, 24 federal class actions were filed against MLMs alleging they were pyramid schemes (seven of these companies were DSA members.)
Over the past three years, a 15% decline in sales volumes averaged by MLM reps has been reported, too. And we’re seeing the fortunes of some long-standing MLMs take a dive. Forever Living UK’s accounts showed a 30% drop in new business in 2018, compared to 2017. And that’s on top of a drop of 64% in 2017 compared to 2016.
In August, Coty announced they were ending their relationship with MLM Younique after just two years, and planned to sell their stake back to the founders again.
There’s an increasing movement against – and awareness about – the MLM industry too. Documentaries like Betting on Zero, the BBC’s Secrets of the Multi-Level Millionaires, and the aforementioned The Dream Podcast have helped take the message mainstream.
And there are a growing number of popular Facebook groups, such as MLM Lies Exposed, dedicated to spreading the word, and offering support for MLM victims. The largest, Sounds Like MLM But Okay, has 142,000 members. The antiMLM Reddit, meanwhile, has over 500k recruits.
Some MLMs try to claim they’re different from the rest
So it’s perhaps not surprising that, in what is becoming an increasingly tainted industry, some companies are attempting to differentiate themselves from their competitors, claiming they’re ‘not like other MLM companies’.
Some companies position themselves as ‘social selling’ or ‘direct selling’ rather than ‘MLM’. But these are really just other terms for multi-level marketing (MLM), and when you look behind the scenes these companies are usually no different (and no better) than other MLMs.
One company who claims they “certainly don’t fit within the ‘MLM’ bracket” are Tropic Skincare. Founded by Susan Ma in 2004 (famously from the TV show The Apprentice), Tropic launched their direct selling platform in 2013.
When we first started writing about MLMs in 2016, Tropic contacted us and asked us to remove their name from our list, as they didn’t believe they fit the MLM label.
We replied asking them to clarify a few things in order for us to verify they weren’t a typical MLM and remove them from our list – most of which they were either unwilling or unable to do. So they stayed on it.
A few weeks ago, Tropic came back on our radar after someone got in touch to ask if they really were ‘different’ and ‘better’ than other MLMs, as their reps were claiming. So we decided to investigate and find out. This is what we learned.
There’s very little information publicly available about the Tropic opportunity
Our first realisation – and huge red flag to us – was just how little information you can find out about working as a Tropic Ambassador (their name for their reps).
Yes you can find their Ambassadors enthusiastically touting how amazing their company and opportunity is on online forums, but they don’t actually divulge any details. Instead they ask you to contact them (or they’ll send you a link to a product catalogue)… the classic MLM tactic.
Why do MLMs do this? It’s usually because they don’t want factual information that can be analysed, compared and challenged easily available. And they certainly don’t want to give you something you can take to family and friends and ask their advice before joining. (And risk being talked out of.)
Instead, they want to control the conversation – and information – and be able to engage in a 121 sales pitch in order to maximise their chances of signing you up.
But Tropic appears to go even further than many other MLMs in this regard. While we can often find a marketing/sales/compensation/success plan (the names MLMs give to the outline of how their business works) online for many MLMs, unusually we could find nothing for Tropic.
Not only do Tropic themselves not appear to publicly publish their Success Plan, but none of their Ambassadors divulge any details online either. (In contrast, Arbonne makes both their Compensation Plan and income disclosure statement publicly available on their website.)
We asked Tropic if they would share their Success Plan details with us – after all, if they were as different as they claimed, and if the opportunity would genuinely stand up to scrutiny, they’d be keen to share it.
But they refused. And when we were able to get hold of a copy – sent to us by one of their Ambassadors – we could see why they were so reluctant. Because rather than proving they were drastically different from other MLMs, it confirmed to us just how similar they were.
And not in a good way.
We examined the Tropic Skincare Success Plan
So what does the mysterious Tropic Skincare Success Plan look like? Here it is:
If you’re not used to examining MLM company plans, this may seem confusing. But we’ll go through what we can take away from this, and what it means for the people who join up as Ambassadors – and how much we calculate they can earn with Tropic.
There are a few things that stand out to us. Firstly, like Acti Labs, they use actual currency, rather than a points system (such as ‘PV’) so you can see exactly how much their Ambassadors need to sell (or buy) to remain active.
And that in itself is an interesting observation. Tropic make a big deal of having no sales targets. In a message to us, they categorically said: “We do not give our Ambassadors targets, and there’s no minimum sales to remain an Ambassador.”
And to an extent, that is true. Or at least, it is if you just want to purchase products yourself, or for friends and family.
But if you want to build a business with Tropic and grow a team, it appears from their Success Plan (and confirmed in an email from one of their Ambassadors) that you DO have sales targets.
You need to sell a minimum of £250 a month to remain an active Tropic Ambassador
In order to remain active at their bottom rank, which is Active Ambassador, it looks like you need to sell £250 a month. At every rank above that, you need to sell £500 a month.
When we questioned the likelihood of meeting such high targets, the Ambassador who sent us the Tropic Success Plan reassured us it was no problem. In her opinion, you can “easily” do £250 a month just from reorders. She also said that if you want to build a business with a team, you need to sell £500 per month, which is “about one or two events”.
However, we know from interviewing former reps from other MLM companies that reaching sales targets like these isn’t easy at all. Indeed, they told us that it is active minimum sales requirements such as these that have led them into debt.
They tell us that it’s just not possible to sell what are usually expensive products in the quantities needed every month to make the targets regularly. And that, to maintain their active status, they’ve purchased products themselves, believing they’ll be able to sell them later.
Even a Black Status Younique Presenter – their top rank – admitted that she personally purchased her own minimum sales requirement to stay active.
The problem is that this debt often accumulates. One month rolls into another, and by the time reps leave their MLM they often have boxes of unsold products in their spare rooms and garages.
This is why you’ll regularly find MLM products being sold cheaply on eBay. (And why it’s estimated that an average of 99.6% of participants lose money in MLMs when business expenses are taken into account.)
We found 697 Tropic products for sale on eBay
So could this be true of Tropic too? Could their Ambassadors be buying products to maintain their active status? If this were the case, we’d expect to see Tropic products on eBay, sold by former Ambassadors in an attempt to claw back some of their losses.
And surprise, surprise, at the time of writing, there appear to be 697 Tropic products listed on eBay. And a number of sellers we looked at were flogging multiple products:
Given the cost of Tropic products these are unlikely, in our opinion, to be end users – members of the public who had bought them at retail price for personal use. They also can’t be current Ambassadors using it as a sales outlet, as it’s apparently forbidden for Tropic Ambassadors to sell products on eBay and Amazon.
And, given that Ambassadors (according to Tropic) “are actively encouraged not to purchase products upfront… Instead, any sales they make are ordered and dispatched from our HQ”, it shouldn’t be unsold stock sold by ex-Ambassadors.
Instead the only possibility, based on the above, that makes sense to us is that these are products purchased by current or former Ambassadors in order to maintain their rank. And now they are attempting to recoup their losses by selling the products on eBay.
This Tropic Ambassador is trying to sell over £500 of stock
If Tropic Ambassadors don’t need to carry stock – and are ‘actively encouraged not to’ – then this Instagram post from an Ambassador confuses us:
As you can see, this Ambassador admits to having stock she’s trying to sell. In the full post she lists 31 products she has available, and next to two of them she notes “1 left”, which indicates she has duplicates of the others.
Even if she only had one of each, the retail cost of these products is an eye watering £587. And even bought at wholesale that’s a lot of expensive stock to hold for a business that claims this isn’t necessary.
Again, the only reason why we can see you’d need that much stock (including duplicates) were if you were personally purchasing to meet your active requirements.
Above is another Instagram post from the same Ambassador three months later. As you can see, she has a significant amount of products.
The post caption claims these are products ordered by customers, ready for delivery. But as we know MLM reps commonly lie in posts like these, and given this Ambassador’s earlier post trying to sell stock, we suspect these are personal purchases made to meet her active requirements.
Do Tropic Ambassadors get a ‘free’ car?
It also worries us to see a car plan on the Tropic Success Plan. We don’t have all the details on their specific car plan, but we do know how the ‘free car’ plan works in every other MLM we’ve investigated. And given how similar the rest of their Success Plan is to other MLMs, we’d hazard a guess that Tropic’s car plan probably works in a similar way.
Namely, this is that you need to maintain your rank (Executive Manager and above, according to Tropic’s Success Plan) to keep the benefit. And you’ll probably need to lease the car yourself, and simply receive a bonus payment from Tropic towards it every month you qualify at your rank.
Of course, this places a considerable amount of pressure on you to maintain your rank. Here’s what it looks like you need to achieve each month to qualify for the Tropic car plan. You need to:
- Meet your own active status sales requirement of £500 a month.
- Have a minimum of two managers under you.
- Have five personally sponsored Active Ambassadors
- Earn central team sales of £4,000 each month.
- Earn entitled generation sales of £25,000 every month.
These are a lot of balls you need to keep juggling in the air. And what happens if, one month, one of your two managers says she’s thinking of quitting? Or you or your team don’t quite make the required sales?
If you miss your target, we’d guess (based on how MLM car plans usually work) that you lose your car payment that month. But with the lease in your name, you still need to find the money to cover it.
In this circumstance, we’d imagine you may feel the pressure to push your team, and possibly even make purchases yourself to get you over the line. (As incredible as this sounds, we know from speaking to former reps from other companies that this happens in MLMs.)
Tropic’s Success Plan seems to reward recruitment over personal sales
While we don’t have all the small print of their business structure, Tropic’s Success Plan does enable us to make some estimations of what Ambassadors need to sell in order to remain active and make money.
And, as with other MLMs, it appears that the structure is stacked to reward recruitment, not personal retail sales to the general public – something that puts it at risk of being seen as a pyramid scheme.
As you can see from the Success Plan, the minimum sales requirement for the bottom Tropic rank (Active Ambassadors) is £250 a month. This rises to £500 for the next rank up (Senior Ambassadors), but doesn’t rise any higher.
So every rank above Senior Ambassador has the same personal sales requirement of £500 a month.
Surely if Tropic were rewarding you on personal retail sales to the public, they’d set higher sales targets for the more senior ranks? And reward and promote you for your personal sales?
But the only requirement that DOES rise with the ranks is the number of active Ambassadors you have personally sponsored, qualified frontline managers under you, and your team sales.
And these are ALL directly related to the people you have recruited under you (and the people they recruit). To us, this is a glaring red flag for MLMs, and places Tropic in the same ranks as the other ‘typical’ MLMs they’re so keen to differentiate themselves from.
How easy is it to earn money from personal sales alone in Tropic?
To highlight just how important personal retail sales are in MLMs, here’s what Andrew Smith, Director of the FTC’s Bureau of Consumer Protection says of the differentiation between MLMs and pyramid schemes:
“Participants in legitimate multi-level marketing companies earn money based on actual sales to real customers, rather than recruitment. But pyramid schemes depend on recruitment of new participants to pay out to existing participants, meaning that the vast majority of participants will ultimately lose money.”
It’s also worth noting, again, that the FTC recently fined former MLM Advocare for being “a pyramid scheme” and a “scam” because, among other reasons, it “rewarded distributors not for selling product but for recruiting other distributors to spend large sums of money pursuing the business opportunity.”
So how easy is it to earn money from retail sales alone in Tropic? Here are some examples of what you’ll earn from monthly sales.
Here’s what we calculate Active Ambassadors can earn a month from personal retail sales:
- If you sell the minimum (£250) you’ll make £62.50 a month.
- If you sell £1,000 of products you’ll make £280 a month.
- If you sell £2,000 of products you’ll make £630 a month.
- If you sell £4,000 of products you’ll make £1,000 a month.
- If you sell £8,000 of products you’ll make £2,800 a month.
And here’s what we calculate Senior Ambassadors and above can earn a month from personal retail sales:
- If you sell the minimum (£500) you’ll make £132.50 a month.
- If you sell £1,000 of products you’ll make £280 a month.
- If you sell £2,000 of products you’ll make £630 a month.
- If you sell £4,000 of products you’ll make £1,400 a month.
- If you sell £8,000 of products you’ll make £2,800 a month.
As you can see, as far as we can tell you’re not rewarded any more for personal sales as you progress up the ranks of Tropic – your opportunity to earn based on commission and bonuses remains the same at the very top rank as it does the lower ranks.
And actually, according to Tropic’s Success Plan, you can’t progress up the ranks without recruiting.
You can also see that, to earn a salary of £2,800 a month from retail sales only, whichever rank in Tropic you have achieved, you need to sell an eye-watering £96,000 of products a year.
Let’s say you worked full time to achieve this – a 40 hour week. And as MLM reps have no entitlement to the legal requirement of 5.6 weeks holiday a year, you worked 52 weeks of the year (we know that MLM reps often work through their holidays to maintain their sales).
If this is the case, we calculate you’d earn just £16.15 an hour for this achievement. Here’s how we calculated this:
- £2,800 a month is an annual salary of £33,600.
- 52 working weeks a year of 40 hours a week is 2,080 hours a year.
- This gives you an hourly rate of £16.15.
And remember, this is before business expenses and tax. And to earn this you need to sell at least £8,000 of products every month.
How much can you earn with Tropic Skincare from sales and recruitment?
So let’s get down to the big question: how much money can you earn with Tropic Skincare – from both personal retail sales and recruitment?
Let’s start with your own personal sales. If you’re an Active Ambassador, and you meet the minimum requirement of £250 a month in sales, you’ll make just £62.50 in commission, according to their Success Plan. And if you’re every rank above and make the minimum £500 in personal sales, you’ll earn £125 a month, plus £7.50 Personal Sales Bonus.
That’s hardly a living wage. And not much return for what we believe would be a considerable amount of work to make those sales each month. (This research discovered that MLM participants earned an average of 70 cents an hour – before business expenses were deducted.)
If you’re a Tropic Manager and above, you also earn commission on your central team. This is 4% on minimum sales of £4,000, which works out at £160 if you just scrape the minimum.
You also earn a Team Mentor Bonus of 3% commission on your personally sponsored Ambassador sales – and for Managers and above you need a minimum of five personally sponsored Ambassadors.
If these five just make their £250 monthly quota, you’ll earn a total of £37.50. And if they each need to make the £500 minimum, you’ll earn £75.
So what does this add up to? If you and all your team make just the minimum qualifying requirements, we calculate you’ll earn the following:
- Your personal sales commission = £125
- Your Central Team Bonus = £160
- Your Team Mentor Bonus = £37.50
- Your total monthly earnings from Tropic = £322.50
We estimate the top senior ranking Ambassadors earn £72 a day
And what if you didn’t just scrape your monthly requirements?
Let’s say you qualified for the largest Personal Sales Bonus (10%) because you personally sold £4,000 of products that month. And your personally sponsored Ambassadors were all Senior Ambassadors and above, with a £500 minimum sales requirement. What would your earnings from Tropic look like then?
Here’s what we estimate, based on their Success Plan:
- Your personal sales commission = £1,000
- Your Central Team Bonus = £160
- Your Team Mentor Bonus = £75
- Your Personal Sales Bonus = £400
- Your total monthly earnings from Tropic = £1,635
This equates to just £377 a week, or £75 a working day. If your working day was eight hours, that would give you an income (before expenses) of £9.43 an hour.
To compare again, the minimum wage in the UK is £8.21 an hour. And if you work for an employer you also get benefits like holiday, sick pay and legal employment rights – something that MLM recruits don’t enjoy.
And to earn this estimated £75 a day, you’d need to be one of the senior ranking Ambassadors earning their top sales bonus, having personally sold £4,000 of products in a single month.
(If we have made any mistakes in our calculations or translations of the Success Plan we welcome corrections from Tropic and will happily amend our figures.)
The top rank of Tropic needs to oversee the equivalent of £1.2 million of sales a year
If you are in the top three ranks of Tropic Skincare (Executive Manager, Platinum Executive Manager and Diamond Executive Manager) you also have a very hefty monthly Entitled Generation Sales quota.
If you’re an Executive Manager, it appears that your team needs to make £25,000 of sales a month. If you’re a Platinum Executive Manager it’s £50,000, and if you’re a Diamond Executive Manager it’s £100,000.
£100,000 of sales in a month equates to £1.2 million a year. That’s a significant responsibility to maintain. And how many people can possibly be running teams making that amount, given that Tropic’s entire net income in 2018 was just £22.5 million?
The answer is 18 people.
This just demonstrates how impossible it is for the vast majority of Ambassadors ever to come anywhere near that rank, in our opinion.
Seven ways Tropic’s Success Plan resembles MLM Nerium’s
Remember the mention of MLM Nerium at the start of this article? They’re currently being sued by the FTC for operating as an “illegal pyramid scheme”. Here’s part of their compensation plan:
And here are seven similarities we note between their compensation plan and Tropic’s Success Plan:
- Your personal retail sales requirements don’t gradually increase as you rise up the company ranks (in both companies they rise just once).
- However your team sales requirements (the sales of the people you recruit, and the people they recruit) DO increase.
- In fact, in both companies you can’t be promoted beyond the bottom active rank without recruiting at least one person.
- You need to have a set number of people (or ‘legs’) under you that you have personally sponsored.
- As you rise up the ranks, you also need to meet a minimum requirement of people of more senior ranks under you (in Tropic it’s Managers and in Nerium it’s Senior Brand Partners and Directors).
- Both companies offer bonuses on your team sales, depending on your rank (Tropic call this a Central Team Sales Bonus, and Nerium call it Coaching Commissions).
- Both companies also offer a car plan for senior reps who maintain their ranks.
For us it’s a big concern that Tropic’s Success Plan has so many similar features to the compensation plans of companies like Nerium, who are being investigated by the FTC.
And it certainly doesn’t back up Tropic’s statement that they “certainly don’t fit within the ‘MLM’ bracket”.
Would we recommend joining Tropic Skincare?
Tropic tout themselves as a ‘different’ MLM, but from what we can see from their Success Plan, the activities of their Ambassadors, and from our correspondence with the company themselves, they are, in our opinion, no different from the rest.
And that means that there is a risk that an average of 99.6% of participants will lose money once business expenses are deducted. (This figure is based on thorough research on the MLM industry published by the FTC.)
We’re also concerned about Tropic’s lack of willingness to answer quite basic questions from us (and remember, they approached us to initiate a correspondence), which included asking for information that other companies, like Arbonne, make publicly available.
Surely, if you genuinely had a business opportunity you were confident worked fairly and were proud of, you’d be happy to share it openly?
The only reason Tropic make it virtually impossible to see their Success Plan, as far as we can guess, is because they know it’s no better than any other MLM’s compensation plan.
Is that a company YOU’D want to trust? Let alone invest your money, time and hope in?
So no, based on all of this, we don’t recommend joining Tropic Skincare. We recommend saving your money and time and avoiding any MLM – including Tropic. And instead either working or starting your own business.
Photo by Sarah Comeau
As always, if we have made any mistakes in this article we welcome clarification from Tropic and will amend accordingly.