Three signs that Forever Living UK is failing

Business

Are the boom days of network marketing at an end? We examine three signs that UK MLM Forever Living is in decline.

For a few years now, many MLMs seem to have been struggling. Some have been forced to change their business model, and others have gone out of business. Find out why, despite the efforts of their new Director of Sales, Forever Living UK appears to be on a downward spiral.

1) Their top managers are struggling financially

We’ve covered this extensively in articles like this one, but it’s obvious to us that the glory days for Forever Living’s top managers are long gone. 

In the short boom years of 2014-2016, some managers in Forever Living were able to earn large bonus Chairman’s Bonus cheques at their annual Global Rally. They used these cheques as ‘evidence’ of the opportunity Forever Living offered, and bought or rented large houses and cars, and other trappings of wealth. 

Many managers appeared to take this money from their businesses using a Director’s Loan. On the plus side, a Director’s Loan gives you immediate access to money without paying tax on it. But on the down side, this money needs to be repaid within nine months of the end of your Corporation Tax accounting period. If it is not repaid, you must pay Corporation Tax at 33.75% of the outstanding amount, or 32.5% if the loan was made before 6 April 2022.

The trouble with taking the money from their business this way is that, thanks to the subsequent decline in the size of their bonus cheques, many Forever Living managers don’t appear to have had the money to repay their loans. 

As a result, we’ve seen some of their homes put on the market, and luxury cars replaced by more modest vehicles. Some have even filed for bankruptcy or been forced into liquidation as they were unable to repay their debts. Others have abandoned Forever Living completely and either quietly returned to paid employment, moved to another MLM or tried to start their own business.

Case study: The Forever Living ‘millionaire’ who owed over £100,000

In 2021, the limited company of one top UK Forever Living manager, whose videos are still on Forever Living’s YouTube channel today, was dissolved by liquidators. 

The liquidators’ final statement shows her Director’s Loan account overdrawn by £53,047. In total, she owed £115,586 to HMRC and £2,939 to trade and expense creditors. Embarrassingly for her, the liquidators decided that she didn’t have enough money or assets for them to pursue the debt, so it was written off.

Three years after liquidators were appointed to attempt to recover some of her business debts, Forever Living was still promoting this woman as a speaker on their “Excellence” Roadshow:

Screenshot

Today, incredibly, she has repositioned herself as a high performance coach, business consultant, strategist and speaker. Here’s how she now describes her time in Forever Living:

“Within just 18 months, my business had become one of the fastest growing in the UK, it developed into an international organisation with a sales turnover in excess of £4m per annum. I enjoyed travelling to many countries and became a speaker at business events hosted in various European countries, across the Middle East and in the USA.”

This hardly reflects the reality – she was unable to pay her business debts and was forced to put her business into liquidation. To us she is representative of the ‘success’ of the Forever Living Managers who joined at the right time and seemingly lived beyond their means in order to recruit victims… only to struggle with their financial responsibilities once the good times ended.

2) Their turnover is at its lowest in over 20 years

When you look at Forever Living’s UK accounts, it’s easy to see why their managers are struggling financially – the boom years appear to be a distant memory. Here’s the change in their sales year-on-year since 2013:

  • 2013: Sales rose by 27%
  • 2014: Sales rose by 70%
  • 2015: Sales rose by 81%
  • 2016: Sales decreased by 25%
  • 2017: Sales decreased by 47%
  • 2018: Sales decreased by 24%
  • 2019: Sales decreased by 24%
  • 2020: Sales rose by 11%
  • 2021: Sales decreased by 11%
  • 2022: Sales decreased by 19%
  • 2023: Sales decreased by 12%

Aside from a brief and small increase in lockdown, as you can see the company’s sales have been steadily plummeting since their high in 2015. And their turnover follows a similar pattern, with their 2023 turnover the lowest in over 20 years:

  • 2003: £21,590,848
  • 2004: £24,057,473
  • 2005: £22,075,927
  • 2006: £21,413,028
  • 2007: £22,082,569
  • 2008: £22,682,489
  • 2009: £23,412,358
  • 2010: £24,157,199
  • 2011: £23,878,750
  • 2012 £27,167,812
  • 2013: £34,726,349
  • 2014: £58,993,590
  • 2015: £106,489,238
  • 2016 £80,066,133
  • 2017: £42,553,600
  • 2018: £32,193,744
  • 2019: £24,510,601
  • 2020: £27,466,360
  • 2021: £24,139,971
  • 2022: £19,643,954
  • 2023: £17,260,086

Here’s what this change looks like:

Despite Forever Living’s attempts to explain the current state of their business as due to “continuing challenges post the pandemic period”, it looks very much like a terminal decline to us.

There’s no conceivable way we can see Forever Living UK return to the brief glory years of 2014-2016; especially as they are not the only MLM struggling now. Indeed, it seems like the entire MLM industry may have peaked.

3) They’ve lowered their promotion requirements for Supervisor

If there was one single sign that Forever Living UK are struggling to recruit and sell, for us it’s the temporary change in requirements to become a Supervisor.

Traditionally, you have needed to sell or buy 25CC over two months to reach the level of Supervisor:

In the UK, you earn one CC, or case credit, for every £170 of products you buy wholesale, or £244 retail:

This means you usually need to either buy £4,250 or sell £6,100 worth of products over the space of two months to achieve the rank of Supervisor.

However, from 1 August 2024 to 31 January 2025, Forever Living are changing the requirement to just 10CCs in a single month:

This has been spun by Forever Living managers as an exciting ‘enhancement’:

But if enough people are already qualifying as supervisors, why make this change? Given the year-on-year drop in sales and turnover, to us this looks like a desperate attempt to recruit more people to the business, and encourage them to sell – and buy themselves.

To us, it’s certainly not the actions of a company that is confident in the success of its business plan. Rather it’s yet another indication that the outdated network marketing model no longer works, and a sign that the glory years for Forever Living UK are well in the past.

Read more about Forever Living

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