Thinking of joining an MLM like It Works? Read this cautionary tale first

Business

Thinking of joining and MLM like It Works? Or is a friend considering it? Make sure you read this cautionary tale first.

During the current Coronavirus epidemic, MLMs are on a heavy sales and recruitment drive. For them, people losing their jobs and closing their businesses simply means more victims to prey on.

And, despite evidence showing that on average 99.6% of people who join an MLM will lose money after business expenses, they’re still peddling their ‘business opportunity’.

This month the Federal Trade Commission (FTC) has had to send warning letters to 10 MLMs about income and health claims related to Covid-19. And one of these companies was It Works.

In the FTC letter to It Works, they warn the company about posts made on their corporate Facebook page.

They also share misleading examples from It Works reps:

The FTC warn It Works that they must immediately cease from making claims, like these, that are unsupported by evidence, and ensure their reps do the same. They give It Works 48 hours to detail the specific actions they are taking.

Why these claims are so misleading

There’s a good reason why MLMs like It Works should not be making claims like these. And that is because, as we’ve already mentioned, they’re not realistically achievable for more than 99% of people who join.

As one mother we interviewed discovered when she joined It Works. Despite building a team of 26 people underneath her, the most she ever earned was £140 a month – and even then made a loss that month.

And this was while working until 2am, putting her children in nursery to work, and running four Facebook pages and five Instagram accounts. Sadly her experience is far from unique (as this ex-It works rep also learned).

And it’s not just It Works. We’ve spoken to people from several different MLMs, including Arbonne, Forever Living, doTERRA, Amway, Nu Skin, Younique, Usborne Books and Herbalife, and all have the same story – being expected to work hard, but still not making money (and then being told it’s their fault).

So if you’re thinking of joining an MLM like It Works, we recommend reading this woman’s personal experience, as she told it to us, before making a decision.

Why did you join It Works?

When I joined my children were toddlers and I was looking for a way to make money. I did look for work, but worked out that after paying for nursery for two children I’d lose money every month. So selling It Works wraps seemed like a no brainer for me.

What did you get when you joined?

It cost me £99 to join, which bought you a box with four wraps and some marketing materials (mostly just postcards). There was no decent marketing or business advice. Instead you were told what you needed to do.

This amounted to wearing a postcard-sized lanyard and going round your local hairdressers, beauty salons and shops and harassing people until they agree to join. (Most of the time they wisely didn’t…)

It was embarrassing. One of my friends laughed so hard when I told her about the lanyard that she had to pull her car over. 

You were told to speak to anyone within three feet of you, and to being EVERY conversation round to the products and the opportunity. It consumed your entire life. 

Were you asked to do things you weren’t comfortable with?

I didn’t do the whole fake it til you make it thing, and I was honest with the people under me and told them I was struggling. But my upline were constantly messaging me, telling me to make my team work harder. 

One of the women under me worked nights at A&E, and she was already spending much of her day pushing. How could I bully her into working MORE?

I was told to emotionally manipulate people who joined after me (and were therefore in my ‘team’) to do things that were ridiculous on top of their full time jobs. I refused to do that. 

I was encouraged only to spend time with It Works people and ‘cash cows’. If anyone in your normal life told you something like that you’d run away! 

I was also told to film a video of me crying, saying why It Works was so important to me, about what it meant for my children or how it was going to get me out of debt – and share it on Facebook. I was told that if my ‘why’ didn’t make me cry, it wasn’t big enough.

I never did this – it would have been far too embarrassing. As a result, I was told I didn’t want it enough; that my why wasn’t big enough and other emotional manipulation.

There was so much brainwashing happening too. You’re never allowed to raise an issue or be negative in any way. If you do ask a question about a problem you have it gets shut down in minutes. And you’ll get an angry private message telling you never to do that again. 

Did people ever buy their ranks or bonuses?

From what I could tell, everyone is buying their ranks – even the people at the top. And it’s extremely difficult to maintain your rank. It was common for people to drop three or four ranks in a month. 

It was common to move people around in your teams in order to qualify for the ranks and bonuses. Promotions are partly based on how many people you have in teams under you, and you can move distributors under someone else 24-48 hours after they join. 

It was also normal to buy the volume you need for a promotion and move it under someone else. But while you can buy bonuses like the diamond bonus, there’s zero chance of you maintaining that over two years. 

One couple in America wanted to go for Black Diamond. To achieve this your team has to earn $100k in commission a month for six months in a row. If you miss just one month you need to start again. 

The third time they tried to go for it, we got messages from our UK upline that we needed to make extra sales that month to help them. So many people in the UK spent extra money on orders they didn’t need to help someone they’d never met earn more money.

I didn’t fall for it though – why should I spend money to help someone I didn’t know become a millionaire? It was ridiculous. 

How much business advice or tax advice were you given?

I think they prey on people who have no previous experience of running a business – especially new mums and people in debt who need the money. People who have no idea about income, expenditure, profit and loss. It makes it easier for people to lose money without realising. 

There’s no business or tax advice either. When I asked about registering with HMRC I was told: “You don’t need to worry about that really.” But I know this is not correct. 

People also sign up family members on order to get or maintain their ranks. To do this they need to give IT Works their National Insurance numbers. They then buy through these accounts. If HMRC every investigate It Works there could be lots of people who get into trouble. 

How much did you make with It Works?

The most commission I ever earned was £140 in one month. This was with a team of 26 people. Usually though I earned between £20 and £60 a month in commission. 

But my outgoings were much higher. As well as paying £800 for nursery, I paid around £100 a month for my It Works autoship to remain commission qualified. So, without taking into account my nursery costs, I made between £80 to £40 LOSS every month with It Works. 

And the one month that I earned £140 commission I still made a loss because I had to help buy a promotion for someone in my upline. 

Why did you help to buy someone’s promotion?!

I got a call at 2am at the end of the month asking me to put through an extra order for £150 as one of my uplines needed it to make her bonus. She said I’d benefit because it would bump up my commission too. But in reality I just spent £150 to help her buy her bonus. 

I heard later that she did that to quite a few people. 

And why were you up working at 2am?

Oh it was normal to be working at 2am! At month end you’d get emails demanding to know why you weren’t online working at 8am. And at midnight when Australia was awake. 

You were expected to be hustling after people got paid on the first of every month, and towards the end of the month. You were also expected to be up at 2, 3 and 4am whenever the American cut off would be to get last minute sales. These rarely happened so you just ended up exhausted for no reason. 

You were expected to be working ALL the time, I was told to message people while waiting for the kettle to boil and even when on the toilet. You couldn’t even have a wee in peace!

Did you ever tell anyone you weren’t making money?

When I told my upline that I was losing money, I was told that I wasn’t working hard enough, and that had to spend money to make money; to invest in my business.

I was asked how I expected to sell without stock and stuff to demo. I was always encouraged to keep buying. 

By the time I left they were running so many buy one get one free offers that I found it hard to get people to commit to being loyal customers on autoship. Instead they’d buy once to get an offer, but never again. 

Why did offers make it harder for you? 

If I sold a box of wraps I’d get 60 points. But if they bought a special offer I’d only get 20 points, so I needed three times as many customers to make the same in sales. 

People would say that we were getting extra volume but actually it just made it harder.

How much did you need to sell to earn commission?

To be ‘commission qualified’ you need to sell 400BV every month. But you can make yourself eligible by signing up to an autoship of 80BV (around £100). So that’s what pretty much everyone does. 

You can’t risk not doing this if you’re working the business; if you don’t get enough loyal customers each month (which is tough to do) then you won’t earn commission. 

As a result, I estimate that 90% of sales volume comes from autoships. These are purchases that distributors make themselves, in the hope they’ll sell later. But many don’t. So, in effect they’re personal purchases, not retail sales. 

There’s also huge pressure from uplines to keep your autoships up. If you have a team of 20 under you, you need all 20 to run autopships to bump your volume up. There’s just so much pressure to keep buying. 

I ran autopships for a year, then turned off for the second year. I was falling out of love with the business, but was convinced to carry on. 

It even cost you money to get paid. When I worked for It Works we were paid on commission cards that you had to send off for. The card cost £5, and you had to pay $2 every time you withdrew your commission from it. Plus they took a $2 charge to give to their charity. You could also only withdraw money if you had over £25 on it. 

We told the cards were good sales tools, and to flash them in petrol stations and shops to get people to ask you questions about it. But they never did!

Did you go to any It Works events?

I didn’t go to any big events as they were too expensive, but I did go to some training events in London. We were taught how to manipulate conversations back to what we wanted, and how to manipulate people into saying yes (including friends and family).

I got sucked in and it sounded good at the time, but looking back I wouldn’t want to be friends with people who did that to me. 

At one training event, one of the top people in the UK bragged that one month she and her husband had contacted over 1,200 people. And they were still short of sales. 

Another boasted that she earned £7,000 a month. But one month I owed her £150 (for booking a stand at a fair that I made a loss at) and she contacted me to ask for the money as she said she couldn’t afford to buy any food shopping that month. There are just so many lies told. 

Did you ever go on an It Works cruise?

A few people I know qualified for the cruise. I didn’t and couldn’t have gone anyway as I didn’t have childcare. But despite what it was promoted as, it wasn’t a free holiday. Firstly you need to get enough points to qualify (35,000), and many people personally bought to get to that amount.

Then you needed to pay an online fee of $400 to book your spot, plus pay your flights to Miami and hotel there before the cruise. You could only take your husband or partner if they were on your team (it was common to sign up family members in order to qualify for bonuses and promotions). And if you wanted to upgrade to a double cabin you needed to pay an extra $200. 

Then you had to cover your drinks on the cruise (only food was included) and any spending money. One girl I know paid over £1,000 to go on the ‘free’ cruise.

It wasn’t what I’d call a holiday either – you were expected to attend company events and schmooze with the top people. It was all so fake and just designed to suck people in deeper. 

And of course, you still need to keep working your business while you’re on the cruise, as you have monthly quotas to maintain. If one person leaves, that part of your team falls apart and you have to start again. It’s exhausting. You can never afford to take a break. 

Unsurprisingly, the second time they ran the cruise they didn’t have enough people to take it up, so they sold spaces on it. 

Why did you decide to leave?

I decided to leave when they bought out the keto coffee; I didn’t want to sell coffee on Facebook. I was also starting to ruin my friendships, and stopped posting on Facebook as a result. 

My husband was also annoyed with me and I wasn’t spending any time with my children. I lost two years of my life to It Works. 

I remember playing with my girls one day and thinking ‘I haven’t done this in so long’. I joined It Works so I could spend more time with my children when they were little, but I was encouraged to put them in nursery so I could go out and hustle. 

I was told, “How can you expect to be successful if you don’t put in the time?” So I put them in nursery three mornings a week, at a cost of £800. This was much, much more than I made with It Works. 

What happened when you left? 

The minute you stop making people money they don’t want to know. I emailed my upline and was told I hadn’t tried hard enough and to think of my children – did I care about them? 

I was running four Facebook pages and five Instagram accounts, but I was still told I hadn’t worked hard enough. You just can’t win, it seems.

Read more about MLMs

Worried about a friend or relative getting sucked into an MLM like It Works, or considering it yourself? You can learn more about the industry in these articles:

Photo by Christina