Monavie is Embarrassed by Their Income Disclosure Statement? (Part 2) |
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[The following is a guest post from Anonymous Aussie, a frequent commenter on this website. I think it was intended to be a regular comment to the original article, but I think the mathematics that she points out is something that should be highlighted and are grounds for further discussion.]
MonaVie Distributor Tom states “Show me any company in the world (with revenue about $1 billion a year) that has that many distributors making more than $160K a year. If you use company’s materials stick to what they say.”
Monavie states they are making $1 billion in revenue though they do not release financial information to support such claims and therefore, this statement remains unproven. See MonaVie – Is MonaVie the Fastest Company to $1 Billion Dollars in … for more information on that.
Secondly, what percentage of any revenue earned was from bona fide sales to persons not associated with the scheme and what percentage is from the investments and purchases from it’s own sales force?! Monavie do not disclose this information either however, judging by Tom’s description that he is consuming everything that he buys, as does his downline (and as does his upline whom he is duplicating), I’d say not much and it serves Monavie well to withhold such a vital piece of information from the public.
Monavie hopes the average distributor is unable to perform basic arithmetic (and this is an accurate assumption in Tom’s circumstances), however we’re able to elicit from the information provided in the 2009 Global IDS the real opportunity that Monavie represents to the average distributor/consumer (again, the distributors are the consumers).
If ALL the distributors were included in the Income disclosure statement (that is, the 87% who did not qualify for commissions – 620,431), the figures would confirm the following facts:
Total distributors = 713,139
Royal Black Diamond and above through to Bronze Executives (2570) = 0.36% of the total sales force.
The above 0.36% of distributors were paid 53% of the total commissions and averaged $1516.70 per week.
Star 1000 through to Distributor level (90,138) = 12.64% of the total sales force and averaged $37.33 per week
$37.33 per week clearly represents a LOSS when all costs are factored into (autoship, training tools, phone calls, travel, attending seminars, etc).
The remaining 620,431 distributors (87%) earned ZERO.
Clearly it’s accurate to say that 99.64% of the ENTIRE sales force LOST money.
The top weighted compensation plan is further confirmed when you consider that those ranked Royal Black Diamond and above through to Ruby Executives (377) who equate to 0.053% of the total sales force received 37.53% of the total commissions paid.
The above group of 0.053% averaged $7227.87 per week.
Even with the Gold, Silver and Bronze Executive earnings included with the remaining distributors (through to distributor level), this group of 92,331 (12.94% of the total sales force) still only averaged $49.13 per week.
Lets not forget again that 620,431 of the sales force earned absolutely ZERO.
Monavie have misrepresented the facts surrounding this farcical opportunity and fraudulently promoted a scheme whereby they elude to inform people as at the time they sign up that greater than 99% of the entire sales force are losing money.
Tom, the hypocrisy lies with a company who has policies and procedures in place which are necessary to ensure the legality of the scheme but which they do no enforce in any way at all, thus leaving the business in the incapable hands of uninformed, gullible and money driven distributors such as yourself.
The above article is intended to be accurate at the time of its original posting. MonaVie may change its pricing, product, or other policies at any time without notice.This post involves:
Income Disclosure Statement
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January 3rd, 2011 at 11:57 am
I dont get it?!? Why would a company be embarrassed about the income disclosure statement if this is true: http://www.acaiberry.com/blog/2010/12/monavie-helps-create-100-millionaires/
How can a company make 100 millionaires and have issue with an income disclosure statement? As usual it seems as if 2+2=5 with this company. If this is not true how can they get away with saying things like this?
January 3rd, 2011 at 3:10 pm
The only thing to do is warn all those below these so called black diamonds with the truth. And the truth in 99.64% of all distributars on the bottom of these legs are not making any money.If you have people below you that are not on autoship…. which is not uncommon to have only 4-5 people out of 20 on autoship.
How do these people continue to make money inspite of such low autoship? They do it by having there downline purchase 12 cases and hoping someone buys this junk.
January 3rd, 2011 at 3:33 pm
I think we’ve all been astounded by the manipulations used to fudge the stats in terms of rank and bonus buying – but the numbers do speak for themselves.
It’s no wonder there’s been no income disclosure since 2009 taking into consideration what the figures prove!
January 4th, 2011 at 8:33 am
Oh, but hey….all these millionaires rising and living the “high life” from the juice….
I wonder what the hold up is on the IDS??? Hmmmm…
January 4th, 2011 at 6:24 pm
Kelly Bangert’s description of losses amongst both himself and his highest ranked certainly makes you question as to the precise reasons an IDS hasn’t been released – clearly if there were significant revenue, they’d be reporting on it.
I found an interesting discussion a while back where discrepancies were noted between the IDS and individual earnings claims on the Home Business Leader Board (pfft…though this is NOT what anyone should consider a reliable source of information in itself considering they’re just more unverified claims) – some interesting math is brought up.
http://www.amwaytalk.com/viewtopic.php?f=47&t=1349
The success of Monavie is reliant on the misinformation regarding every aspect of the business – the products and the opportunity. It’s been proven that every piece of information provided by this abysmal company is distorted and manipulated in one way or another and deserves the utmost scrutiny.
January 7th, 2011 at 11:30 am
That is pretty bleak about the income, now not counting the tool and seminar profit R3G and TEAM earn for just 2 guys and after the expenses of extra products, sales tools, seminars and travel how many are REALLY making a profit?
January 9th, 2011 at 3:11 pm
The IDS is from “July 4, 2008 to June
26, 2009″, it is going on 2 years now… where’s the new IDS? Why aren’t the conspiracy theorists shucking miracle juice crying foul?
January 9th, 2011 at 3:16 pm
Want to see something sick?
http://www.facebook.com/group.php?gid=32143750319
Yeah… I threw up a little too.
February 6th, 2011 at 2:07 pm
It’s now February 2011 — still no MonaVie IDS since June 2009.
March 3rd, 2011 at 8:48 am
It’s now March 2011 — still no MonaVie IDS since June 2009.
March 3rd, 2011 at 8:25 pm
I’ve stopped holding my breath on that one. Bit of a shame really, we would’ve loved to have taken a very close look at the next income disclosure released.
March 3rd, 2011 at 9:30 pm
I think that is what they are afraid of Aussie..
March 4th, 2011 at 8:19 am
I agree. They stopped updating not long after we did the first detailed analysis of the IDS here and on Lazyman’s site. The IDS was ugly then; I’m sure it would be much uglier now.
March 5th, 2011 at 2:09 pm
I bet that even less than 14% are even making any money whatsoever now.
I just went over the IDS again and noticed how they put a column called “hours worked” in there. I guess that is why they use the “you didn’t work hard enough line”, although I know that distributors work many hours and are still at the bottom levels… so they are obviously fudging the numbers on that data columnn. Of course, they put a little disclaimer in there absolving themselves off all responsibility if one works 40+ hours and makes next to nothing.
Note this line on the IDS:
“A copy of the IDS must be presented to a prospective
distributor (someone who is not a party to a current
MonaVie Distributor Agreement) anytime the Compensation
Plan is presented or discussed, or any type of
income claim or earnings representation is made.”
So what if I ask “Why is this a 2 year old document? Where’s the current one? Would I buy stock on 2 year old data figures?”
How about this gem:
“MonaVie’s corporate ethics compel us to do not
merely what is legally required, but rather, to conduct
the absolute best business practices. To this end, we
have developed the Income Disclosure Statement
(“IDSâ€).”
So are they themselves saying they are shady, since now new IDS has been created? What happened to the Christ-like ethics claim this company engages in?
March 5th, 2011 at 6:25 pm
Great job mackwiz. Question. What are the laws for companies to display this info?
March 5th, 2011 at 6:47 pm
Unfortunately, the law doesn’t state they need to provide an income disclosure. Unless they’re making income claims of course.
The DSA fought and won to keep MLM companies exempt from the FTC business opporunity rule in 2006 which would have required them by law to provide detailed financial informaton to prospects.
Great points, Mackwiz!
Another thing that I found particularly interesting also was the fact that despite promising time/financial freedom, the IDS shows those at Royal Black Diamond and above worked on average 40> hours per week. Bit of a contradition, yeah?
On the other hand though, anyone who’s seen a person starting out in the business knows they spend every waking moment and opportunity in pursuit of same – to say that those in the lower ranks put in very few hours is complete BS.
March 5th, 2011 at 6:48 pm
Sorry, I meant >40 hours per week.
March 6th, 2011 at 8:23 am
You also have to realize the actual time put in for tastings, even if you did them every night, are likely only going to run about 2 hour. YOu have to them in the evenings because all of your potential victims have real jobs that they work during the day. Most of them don’t want to stick around late because they work the next day. You might be able to have one or two on the weekends, if you have rounded up enough victims. It is a bit misleading to say that you only worked 15 hours and you have achieved Ruby. What I think people neglect to mention is that in order to get enough victims to attend a tasting every night is almost impossible, you have to be out hustling 24/7. You eat, breathe and sleep it, every single person you meet is a potential customer who you need to get to one of the tastings. It is all consuming. If you do take the time out to attend one of your kids’s sports activities, the parents there are considered potential distributors so you are “working” them while you are there.
My guess is these Royal Black Diamonds (most of whom were just brought in from other MLMs so didn’t even earn their way to Diamond) are including the travel time to go to the various meetings/conventions, nationally & internationally to “motivate” (aka brainwash) . This would eat up most of the “40 hours a week”. They are not out hustling business, they are letting their downlines do the grunt work but act like they are out there in the trenches with them.
Also, none of these people make this money on a consistent basis so I think the IDs is a waste of time. That said, it would be interesting if Dateline or someone did an undercover investigation to see if they are producing the IDS at the “tastings”.
March 7th, 2011 at 8:19 am
From what I’ve witnessed, the IDS takes a back seat to the pictures of yachts and jets in the Monavie sales pitch. When they do show the IDS, they focus attention only on the top ranks (“see, look how much money YOU can make!!!â€).
When forced to address the dismal statistics for distributors at the base of the pyramid, the execs muddy the waters by saying that most of the distributors at the bottom levels are retail customers who signed up only to get a discount. It’s totally untrue of course; the IDS clearly specifies that retail customers are excluded from the statistics. This also raises the obvious question as to why the company would require someone to sign a distributor agreement if they are only interested in getting a product discount and have no intention of selling. Why would they not just offer a separate preferred customer agreement that does not require a commitment to become a distributor (or divulging ones SSN)? The answer is that their intention is to hide the true (alarmingly high) failure rate.
So the prospector’s next move is to try to convince people that most of the bottom level distributors in the IDS, even if they were in fact initially intending to work the business angle, made no real effort to build the business and simply quit (shifting the blame for failure on the distributor rather than the flawed system itself). Of course, it can’t be proven from looking at the IDS whether a distributor failed to earn money because of lack of effort. This creates a convenient out for the distributor showing the IDS to a prospect because it allows them to claim that effort is always richly rewarded and that failure only occurs as a result of lack of effort (clearly untrue in both cases).
In regard to those distributors who do quit, it would be a logical conclusion that they did so because the system did not work and they were unable to make enough to offset the high cost of the juice and tools. Why would someone quit a business that offers success? They almost certainly wouldn’t. They quit because they realize that the “system†simply doesn’t work. So quitting the business is not a sign of individual failure; it is a reaffirmation that the system is designed so that the vast majority will fail in order that a few people at the top can prosper at their expense.
The stats in Monavie’s IDS are massaged in many other misleading ways as well. For instance, they exaggerate the success rates by listing a distributor at a particular rank even if that distributor was unable to maintain that rank consistently over a year. The stats are also based on phone surveys to determine the number of hours worked per week. This recall-based method is a highly flawed method for capturing such data, as distributors at all ranks would tend to underestimate the number of hours worked per week (the bottom ranks would do so out of embarrassment and the top ranks would do so because they are all blatant con artists).
March 8th, 2011 at 5:15 am
Vogel said “When forced to address the dismal statistics for distributors at the base of the pyramid, the execs muddy the waters by saying that most of the distributors at the bottom levels are retail customers who signed up only to get a discount. It’s totally untrue of course; the IDS clearly specifies that retail customers are excluded from the statistics. This also raises the obvious question as to why the company would require someone to sign a distributor agreement if they are only interested in getting a product discount and have no intention of selling. Why would they not just offer a separate preferred customer agreement that does not require a commitment to become a distributor (or divulging ones SSN)? The answer is that their intention is to hide the true (alarmingly high) failure rate.”
Isn’t it ironic that the high failure rate that is predetermined by the mathematics of the scheme is what gives it legal legitimacy? If we go by the spirit of the Amway rule that 70% must be retail customers, it is only by having an extremely high failure rate, and then classifying them as wholesale customers that validates the scheme in the eyes of the law. They never have to worry about the 70% rule because there is no way to ever come close to having 30% profitable. Dalin Larson is Dr. Evil.
March 8th, 2011 at 9:02 am
Monavie does have a seperate way for customers to get their products, it’s called the Preferred Customer Program. Customers can sign up and receive all of their products at wholesale price. You can read about it here http://monaviemediacenter.com/news/preferred-customer-program.
Scott Gleason
Independent Distributor
ID: 2358622
March 8th, 2011 at 12:33 pm
Thanks Scott, we are well aware of the Preferred Customer program. Unfortunately, the program didn’t exist when the last IDS was released (mid year 2009). Please pass on a more recent one. Also please give us the numbers of people in the Preferred Customer program so we can know just how many people are interested in the juice vs. the business.
March 8th, 2011 at 6:02 pm
Jim states “If we go by the spirit of the Amway rule that 70% must be retail customers, it is only by having an extremely high failure rate, and then classifying them as wholesale customers that validates the scheme in the eyes of the law.”
IF distributors were selling 70% of there goods purchases to bona-fide customers outside the scheme, IF the company monitored the compliance regarding paying bonuses and commissions based on such sales and IF someone was auditing the company itself to ensure that they were monitoring their sales force and complying with the law themselves, then theoretically the 70% rule could work.
The only thing is that we’re well aware that these aren’t bona-fide retail customers – the reality is that they’re distributors who failed in their ability to qualify for commissions.
As we know, Monavie intentionally blur the distinction between the customer and distributor in the first instance by offering customers the opportunity to sign up as a distributor to receive wholesale prices (thus killing a distributor’s retail market in any event). They further blur the line by referring to distributors who didn’t qualify for commissions as their wholesale customers.
There’s no reason to blur the line between a customer and distributor or any need to make a customer agree to the same terms and conditions as a distributor to receive discounts – except in MLM scams such as Monavie where the legality of the scheme may well hang in the balance of this very point alone.
Monavie (and other MLM/pryamid scams just like them) do everything to conceal the extent of revenue from their own sales force as opposed to bona-fide customers because they are their biggest if not only source. There’s no doubt in my mind that this is known from the absolute onset considering the policies are put in place in the first instance – they’re in the business of pyramiding after all and distributorships is what they sell.
Every form of manipulation is done to also conceal the true losses when putting together the IDS – which are obviously going to be far greater than depicted in same.
April 2nd, 2011 at 9:02 am
It’s now April 2011 — still no MonaVie IDS since June 2009. I wonder if they’ll hold a party to celebrate its two year anniversary.
April 12th, 2011 at 7:54 am
I noticed it too, since the blogs have been un-slanting the IDS with facts not Monavie math. One other thing I noticed was when the IDS first came out the Bronze level and aboves were over 5% two years ago it dropped to about 1%, can’t help but wonder what the true numbers are now.
May 1st, 2011 at 7:09 am
It’s now May 2011 — still no MonaVie IDS since June 2009. Just one month away from grand 2-year anniversary.
Can you imagine someone asking you to invest in a company, then having them show you 2-year-old financial data?
May 1st, 2011 at 7:10 am
It’s now May 2011 — still no MonaVie IDS since June 2009. Just one month away from the grand 2-year anniversary.
Can you imagine someone asking you to invest in a company, then having them show you 2-year-old financial data?
January 18th, 2012 at 11:21 pm
I see a lot of anger in the comments. And I understand, but don’t quite agree with the premise in this article. You are basically saying that the money pretty much stays at the top and everyone at the bottom loses. That is prety much stating the obvious when you look at the disclosure. That being said, look at any multi-billion dollar company. How many of those companies’ employees are “millionaires”? I am willing to bet that chances are you are going to see similar results. Sure, the difference is that MonaVie has created a special name for the ranks, but why not look at the levels as they would pertain to a “normal” business. You have your basic employees, leads, supervisors, managers, directors, VP’s and Presidents/chairmen/CEO’s. All you succeeded in doing is prove that Monavie’s compensation distribution is like that of any other company.
The reality is that the people who bought into the business and did not succeed either did not absorb the information enough, did not set aside as much time as might have been needed to generate potential business, did not know enough people, decided not to do business at all and consume the product for their own personal benefit, or decided that this path was not the correct path for them at all. But to call this a scam? I think not.
You want to know what a real scam is? McDonalds, Burger King, Wendy’s, Coca Cola, Pepsi, and thousands of other multi-billion dollar organizations that take your money every day or every week selling you food and drinks that possess absolutely ZERO health value and are key contributors to the astronomical increase in obesity in this country. Yeah, but MonaVie is the bad apple because they are marketing a product that promotes a better and healthier lifestyle. Think about it: this company makes so much money without having to advertise all over the place. Do you know why? Because the people who REALLY try and SUCCEED in that business actually BELIEVE in the product they are advertising. They are not there purely for the financial gain. Going in just for the money will take just about anyone on a fast track to nowhere fast, which I can almost guarantee will be the reason why things went so sour for the 600,000+ people who never accumulated any return on investment.
Everything that is popular today started as an idea from an individual or small group. Eventually the idea grows and becomes popular, while still attracting a great deal of criticism because it is new. Over time, the business continues to grow, attracting more scrutiny because of its popularity. Now competing companies decide to file lawsuits because they feel like something is not right with the business because it is succeeding so rapidly. Why is it that success is so intimidating to others? Well, that is easy, it’s because they are not achieving the same degree of success and feel as though they are somehow more entitled to a piece of the pie.
I am not a member of MonaVie, but I plan on joining the ranks shortly, regardless of the end result. I will put in the work and hopefully reap the benefits in the future. If I do not, it will not be because of the way the company does business, but because of the reasons I mentioned previously.
January 19th, 2012 at 10:32 pm
Jorge,
I think you missed the point of the post. It’s not just that the majority of the money goes to the people at the top, it is that 99.64% of the organization works only to LOSE MONEY. I read today that Google employs about 30,000 people. To make the comparison this would be like only 108 of them getting a salary for all the work they do. And if you start to factor in the majority of people who just make a couple hundred dollars a month for all their work – near minimum wage – it would be like 29,999 getting a pretty bad deal.
I have succeeded in showing that MonaVie’s compensation distribution is NOT like that of any other company.
Don’t even go down the path of MonaVie Distributor: Your Job is a Pyramid Too!
And don’t bring the Coca Cola analogies either: MonaVie, Secret Formulas, and Coca-Cola
We are all for health around here. That’s one of the reasons we are against MonaVie: Men’s Journal Proves MonaVie Lacks Nutrition
You can’t compare McDonalds to MonaVie because one is a restaurant and the other is a juice, (although now it has weight-loss meals too.) People don’t go to McDonalds for health, they do it for convenience, speed of service, taste, and cost. MonaVie has none of these things going for it (one may argue taste, but McDonalds sells more burgers than MonaVie does bottles, so the people have spoken there).
MonaVie makes so much money because it brainwashes its distributors with cult tactics and gets them to pay thousands a year for juice and other products in hopes of being in a business that will some day get them rich. And yes “BELIEVE” in this case is brainwashed. It is well-documented from actual cult psychologists.
As for the 600,000 who never accumulated any return on their investment, the reason is clear and it beautifully stated here: It’s Not a Matter of Effort, it’s a Mathematical Certainty.. Another great article explaining why this happens is at: The MLM Gas Station and $8/Gallon Gas.
Don’t confuse MonaVie with being new or popular. It has been around for a long time and you can interview 10,000 people and 9999 will never had heard of MonaVie. Not only that, but MonaVie is sinking ship and has been for a few years. Sometimes companies get lawsuits filed against them because they actually break the law.
January 20th, 2012 at 7:02 am
Jorge, you see a lot of anger because we have a right to be angry. Let me ask you, if your family was conned into paying hundreds of dollars a month for something that is essentially vitamin fortified fruit punch, would you not be angry?
The argument has been something like this “most people don’t work the business, they just buy the juice for it’s nutritional content including high anti-oxidant levels”. So, my family didn’t want to “work the biz” but I convinced them that the juice was a miracle juice because I was being shovelled this crap by my up-line. I came to find out that the juice is, as Vogel so eloquently puts it “piss water”. I think about all of the things my family could have done with that money, trips with their children, beefing up their college funds, etc.
I still find Facebook sites in my area that say that Monavie contains 13 servings of fruits and vegetables a day. This is completely false. We were/are all being fed lies and half truths in order to peddle these products.
And, I saw people working their ASSES off and quitting their regular jobs to peddle this scam and they never got beyond Gold or Ruby. They were very good sales people and very convinced that this company and juice were amazing. One has lost her business and is on the verge of losing her home. Oh, but I guess you are different.
Monavie is literally tanking in the U.S. and Canada so they had to find victims overseas. Do your independant research.
I can tell by reading your post that someone has really worked you over and you are well on your way to the land of “bilk and scummy” but please reserve any further cookie cutter arguments until after you have read the articles that Juice scam has suggested you read.
There is also a recent article in the Salt Lake Tribune which captures the essence of this “company” you will be “joining”.
http://www.sltrib.com/sltrib/mobile/53061545-90/monavie-company-distributors-percent.html.csp
January 21st, 2012 at 4:10 pm
Hello Jorge, and welcome to the conversation.
You said “The reality is that the people who bought into the business and did not succeed either did not absorb the information enough, did not set aside as much time as might have been needed to generate potential business, did not know enough people, decided not to do business at all and consume the product for their own personal benefit, or decided that this path was not the correct path for them at all.”
This is a common belief among those involved in MLMs as it is preached by the leaders and in the motivatonal materials which distributors are encouraged to subscribe. But in fact, this is not the reason for the large percentage of distributors losing money. The fact is that the compensation plan guarantees that 97% of all distributors must lose. As MS referenced, please read http://www.juicescam.com/its-not-a-matter-of-effort-its-a-mathematical-certainty/. The article originally stated that 95% must lose but it was corrected in the comments.
I would encourage you to print this article and take this mathematical evaluation of the compensation plan to your upline for their comments. We have yet to have anyone from Mona vie find fault in the math, if it is incorrect, I for one welcome any corrections.
Once you understand that the compensation plan does in fact guarantee losses to 97%(this is in a perfect downline, the actual experienced losses are over 99%), you then need to understand that the Mona vie juice is not what is being sold. What is being sold is the “opportunity”. In fact, during the 2008 Believe convention in California Steve Merritt suggested to the crowd that during tastings to “not spend too much time on the juice… get to the opporunity”. Why? Because that’s what’s being sold and that’s what gets people excited and want to become a distributor.
Mona vie sells the dream of the opportunity, the dream to be rich, escape your job, and freedom to spend time doing what you love. But the opportunity is an illusion and it is never explained that 97% must lose no matter how hard they try, how much they believe in the product, or which system they are plugged into.
You also said “I will put in the work and hopefully reap the benefits in the future. If I do not, it will not be because of the way the company does business, but because of the reasons I mentioned previously.”
Please be aware that the only way you will be able to reap the benefits is via the losses of those who you will introduce into the scheme and those they introduce. In fact, the math shows that you will have to be responsible for 30 people losing into the scheme before you can even break even. But to be fair, everyone gets juice.
You also said “You want to know what a real scam is? McDonalds, Burger King, Wendy’s, Coca Cola, Pepsi, and thousands of other multi-billion dollar organizations “. The difference is that these organizations have employees and customers. In Mona vie the employee is the customer. All of the employees of the great companies you mentioned earn a profit to some degree. None of them make their employees pay to work for them. None of them require employees purchase a certain amount of their product in order to qualify for their weekly paycheck.
Jorge, I hope you will take my advice and take an objective look at the facts as they are presented. If you have any questions or if I can help clarify any of what I have stated, I will be glad to assist you. If I’m wrong, at least you did your due diligence. If I’m right you may still be able to change your mind before you harm those you care for.
January 22nd, 2012 at 10:15 am
Jorge,
There is quite a difference between someone working at McDonalds, Burger King or Wendy’s who are all earning at least minimum wage, and 99.99% of all distributors in Monavie who are paying out several hundred dollars a month just to be involved.
Better get your facts straight before you jump in with both feet or your screwed.