When reading this I guess you have come across Nu Skin from a friend, or a friend’s friend that badly wants you to come and listen to the number one presentation that will “like they claim” change your life!
Read my Nu Skin review based on experience from being a Nu Skin distributor.
“Achieve financial freedom and live your dream life”. Yes, that is how it goes down when you are attending their hype motivational company presentation meetings.
They know exactly how to encourage people and get the hopes up.
Who would not want to become a successful business owner with a residential income, not having to lift a finger when reaching “Team Elite” level. Like you probably understand, Team Elite is the highest of levels when doing this business.
Well, let me tell you how it really is through my own personal experience trying to become an independent distributor with Nu Skin.
First, a Little about the Company Nu Skin and Their Business Model
I want to start by saying good that you are doing your research before taking a decision whether to join. Every business opportunity that needs your commitment in form of money and time, should be well researched before jumping in.
Nu Skin Enterprises was founded in 1984, by Blake Roney, Sandie Tillotson, and Steve Lund, in Provo, Utah. The company originated in the U.S. and began its first foreign operation in Canada in 1990.
The founders of Nu Skin decided to build a company that would combine innovative personal care products with ingredients that subscribed to the philosophy of “all of the good, none of the bad”.
You do not know how many times I have heard this sales pitch; “all of the good, none of the bad”. I even used it myself numerous times.
I am not trying to go against them and this statement because their skin care products are actually good. I used them for about a year myself and was happy with the results.
However, they are a bit pricey and I feel that as of today there are many products on the market that TOP the Nu Skin products for a MUCH LOWER cost.
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Let us Talk More About the Actual Nu Skin Business
Nu Skin has been around for quite some time now and the company is global with representatives on 53 markets world wide.
Nu Skin is Built on the Multi-Level Marketing (MLM) Business Model
Nu Skin is a direct sales Multi-Level Marketing (MLM) company that market and sell skin care products and nutritional supplements.
What Exactly is Multi-Level Marketing?
In multi-level or network marketing, individuals sell products to the public — often by word of mouth and direct sales.
Typically, distributors earn commissions, not only for their own sales, but also for sales made by the people they recruit (source: FTC – Federal Trade Commission).
The most recognized Nu Skin products are the ageLOC skin care line. This is an anti aging series with everything from skin creams and serums to home spa equipment.
They also offer Nu Skin 180 body care, hair products and cosmetics. I purchased a spa system for cellulite removal, but I never saw any results. Although, I did not have patience to use it every day for 20 minutes as you were supposed to.
More products are home spas for face rejuvenation, Pharmanex vitamins, nutrition supplements, and weight management products in form of shakes and tablets.
The ageLOC skin care series and the Pharmanex nutrition supplement brand are currently bought and marketed by 950,000 distributors. The ageLOC line was responsible for 43% of the total profit in 2012.
The representatives of the company do not like to call Nu Skin a multi-level marketing company, since they know it does not ring well in many people’s ears, so they use the little nicer phrasing of a network marketing company instead.
Many people associate the MLM business model with pyramid schemes.
This Takes Me to Next Question – Is Nu Skin a Pyramid Scheme?
With Nu Skin you earn an income from the sales you make yourself, as well as from the people you have recruited to become distributors – also known as your “down-line”.
The more people you can recruit to your organization below you – your down-line – the more money you will make.
Most Nu Skin’ers are hoping to recruit really good entrepreneurs under them that build big organizations that give the up-line residential income without hardly no efforts.
If you get a gang of these entrepreneurs, you can make money and more or less not lift a finger.
In other words, the money is not in selling actual products, but more in recruiting people to do the actual business and grow your organization.
“Not all multilevel marketing plans are legitimate. If the money you make is based on your sales to the public, it may be a legitimate multilevel marketing plan. If the money you make is based on the number of people you recruit and your sales to them, it’s not. It’s a pyramid scheme. Pyramid schemes are illegal, and the vast majority of participants lose money”.
Robert Fitzpatrick, who operates the website Pyramid Scheme Alert, insists that more than 99 percent lose their money, with the turnover rate at some companies exceeding 90 percent every year.
Robert is explaining it like this: “If you have to recruit—then the ones you recruit have to recruit,” Fitzpatrick said. “Now you’re in a chain letter. And on a chain letter, most people are going to lose. Most being 90 percent to 99 percent.”
It is hard to get any concrete evidence if Nu Skin, like many other Multi-level marketing companies, are based off a pyramid scheme because often they make their reports too complicated and just too long for investigators to go through it all.
I would say that they certainly are, since the up-line makes more when the down-line grow their organizations.
On the actual meetings Nu Skin representatives always protected themselves by saying that it could not be considered a pyramid scheme, since the down-line only goes 6 levels deep.
This is what Nu Skin tells their distributors:
“Illustrations that show a person’s down-line organization as a pyramid are prohibited. Nu Skin will not allow illustrations that show the structure of an organization without including customers in that structure. The illustration itself should not extend more than two levels deep”- Source: NuSkin.com.
Sounds like a cover-up to me! They are well aware of the fact that they are operating as a pyramid scheme when having to put down this disclosure.
Anyhow, no matter levels and pyramid schemes, the vast majority of distributors end up losing thousands of dollars joining Nu Skin, including me. To hear my story, continue reading.
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6 Things to Consider Before Joining a MLM Company
The Federal Trade Commission Recommends You to Ask These 6 Questions Before Joining
Any of the MLM’s:
1. Can you make a sustainable profit from just selling the product, without having to recruit a single person?
2. How many products are sold to pure retail customers? – Customers who are not also distributors in the network.
3. Does the company’s compensation plan recommend you to buy large amounts of products to qualify for a more senior position in the network and bonus checks?
4. How long does it take to start earning an income and how many distributors do you need to recruit to make money?
5. What is the failure rate and average compensation for both a part-time and full-time commitment?
6. Are the expenses of promoting and running the business higher than the average distributor compensation?
I can answer question number 3 right away with regards to Nu Skin. Yes, they do encourage you to invest in a large amount of products in order to be able to create your own organization.
To make any money whatsoever with Nu Skin you have to be part of their monthly automatic delivery reward program. You have to continuously order products for a certain cost each month.
To motivate this they say; “hey you have to buy skin care products from somewhere anyway right!”
True, but I may not choose a shower gel for $30 when I can buy it for $5 at Publix, or if I am lucky $1 at the Dollar store.
Although, when you are at one of their “hype” meetings and are eager to fulfill your dream of being a business owner and achieve financial freedom, you think that it all makes sense.
How My Own Nu Skin Experience Started
I met a friend from my home country, Sweden, that I used to work with at a local gym in Stockholm, Sweden. I actually met her here in Miami and she had moved here as well, so that was quite a shocker.
She introduced me to Nu Skin and took me to one of their “hype” motivation meetings. They make it sound so good and so easy to make a big income with MLM. Financial freedom is around the corner wihooo! At least so they say!
I left the meeting convinced that this would be my thing. I was also so happy to be able to work with my Swedish friend.
Of course, she recommended me to go in BIG if I was going to invest efforts into doing the business. She convinced me to start with buying the large inventory package, so I did.
I threw away $1500 for nothing!
Maybe not for “nothing”, since you get actual products for the money, but I did not need those products, so for me the money was wasted.
The thing is that you have to come up to 2500 points in order to qualify to start your own organization as an independent distributor. Every dollar is translated into points – so $1 is 1 point.
My friend told me that when buying this package, I would earn 1000 points, and that it would give me a head start collecting the points. She also said it would not take long to collect the other 1500 points.
Ooops, that turned out to be completely wrong.
I trusted her and went for it. I bought products for $1000, while sweating a bit. It is not every day you buy skin care products for $1000 all at once.
I did try hard reaching my 2500 points! We were running around to lots of businesses related to the skin care industry and tried to book meetings with the store managers to sell products, or to convince them to do the business.
It did not go well!
I Was so Frustrated to Have Invested More or Less Full-Time Efforts for 3 Months and Money,
and Only Got 1 Sale!!
Three months seems like a LONG time when you are trying to promote a business with the same sales pitches over and over, and not are getting through to anybody.
The constant answer when trying to recruit was: “Let me think about it”, or “No, I do not want to get involved in those pyramid schemes”….and so it continued.
After these months of regular hype meetings that took time away from spending time with loved ones (they were always at night when people had finished their regular work) I threw in the towel and gave up.
By the way, another way of fishing you in, is that they tell you to start small on the side of your regular work. This is exactly how they are cashing in money from the monthly subscriptions from people trying to do the business besides work.
They know that you do not stand a chance to build an organization on the side of a full-time job.
It takes a 100% commitment and a portion of good luck to succeed, so in this way they are just using people to buy their products.
Nu Skin also has this 3 feet rule that I never approved of. Namely, to always share the business with anyone who is standing within 3 feet from you at the mall, in the grocery store, at the gym etc.
No matter where you were you should apply this rule. I tried it a couple of times, but was never comfortable with it. I rather tried to book real meetings with spa salons, hair dressers, and nail salons to try and sell the products and possible also make them do the business.
Presenting Nu Skin’s Commission Plan
“To qualify for commissions and as an active distributor, you have to generate 100 PSV (personal sales volume) have to purchase or sell a minimum of $100 of its products every month to qualify for multilevel commissions. $2,000 in monthly sales must be made by their team, accounting for the majority of Nu Skin’s sales. Most of them will lose thousands of dollars in this scheme and have unsold products in their basements”.- Source: Fortune
The commission data below are taken from Nu Skin’s own report from 2013:
14.19% – An average of US active distributes who earned a commission check on a monthly basis. Observe that 85% of active distributors did not earn a daim.
5.38% – Earned a monthly average commission of $30.
$176 – Is the average commission paid to US Active Distributors each month. That is a yearly income of $2112, according to their numbers.
These are NOT the numbers they show you on the meetings! No, no…. at the meetings they make sure to bring lots of success stories to wow you. They bring people from high up the chain that make millions.
Yes, there are a FEW people making millions with Nu Skin, but like mentioned, to get there you need lots of luck, know how to recruit people, and also be a good liar.
I am saying a liar, since it is such a low chance to succeed, but Nu Skin claims it is so easy and that Nu Skin is the solution to financial freedom. Anyone can do the business just from being a user of their products. Well, I could not and I ended up spending a lot on their products!
The few people that do make a decent income are doing that from fooling their down-line into investing in more and more products. Not morally right to me. But hey.. you have probably heard of ’em people walking over corps to get what they want.
Let Me Break It Down Further – What Will it Cost to Join Nu Skin?
Product Package Costs
Like you read in the summary of my own experience with Nu Skin, you first have to purchase a product package. The product packages start from $475 up to $1519.
I did not purchase an actual prepared package. I choose the products I wanted to buy myself for $1000.
Automatic Delivery Rewards (ADR) Program
You will also have to sign up for a monthly automatic delivery rewards (ADR) program.
No packages are less that $100, so it will cost you at least $100 a month to do the business. Money that will add up pretty fast.
This is How it Says on the Website: You Have to Be Enrolled in the ADR Program to Qualify for LOI, Commission and Bonuses.
Then they make it even more difficult to get your commissions by saying:
“Commissions and sales bonuses are paid only to active Distributors. See Glossary for explanation of Active Requirements, including retail sales requirements. You must have sold or consumed 80% of your inventory before your next order” – Source: NuSkin.com.
This is very odd. Why do they care about this? As long as you continue your monthly orders it should be ok right?!
Ways to Make Money with Nu Skin
There are 6 different levels that you can earn with Nu Skin, but they come with lots of different rules and regulations. It is very difficult to understand the actual compensation plan.
If you want to take a look, you can find it here.
Only to Earn a Little Extra of $500 Each Month, You Have to Reach the Gold Executive Level, and Only 1.09% of All Nu Skin Distributors Reach This Level.
Also, from the commission plan only 1.59% actually makes more than $500/month.
If they would skip the success stories on the meetings and only focus on real numbers, you easily realize that NO ONE would invest time and efforts into this business.
They know this and are smart enough to invite the same two couples – an American couple and a Japanese couple – that have made incredible success with Nu Skin.
After trying to do the business myself, I really cannot understand how they did it, but I take my hat off for them and their success.
Nu Skin Has been in Legal Hot Waters More Than Once
Important to add is that Nu Skin has been in legal hot waters numerous times.
For example, in1997 – Nu Skin had to pay $1.5 million to resolve FTC charges over fat loss claims for supplements – Source: FTC.
Recently, in 2016, Nu Skin settled $47 Million for operating a pyramid scheme after being sued by China in a Utah federal court. Nu Skin was also forced to pay another $750,000 for bribing a top Chinese official with funds from Nu Skin’s charitable division after a US Securities and Exchange Commission probe – Source: Wikipedia.
Nu Skin Pros & Cons
- Nu Skin is a reputable company that has been around for quite a while, since it started back in 1984.
- They have a solid background and offer good quality products. Nu Skin’s products and the skin care niche is recession proof.
- No matter fluctuations in the economy, there are always going to be a high demand of products that keep you looking young and healthy.
Why don’t we start with this incident:
One of the co-founders of Nu Skin, Nedra Roney, was deleted from the website in an attempt to hide that she is a co-founder because she has been involved in several lawsuits. She also pleaded guilty to prescription-drug fraud in 1996 – Source: Fortune.
This is only one of several outrageous stories with Nu Skin founders involved.
- With this being said, 85% of distributors earn nothing with Nu Skin!
- You have to bother friends and family, or in fact everybody in your network and try to get them to join.
- You are becoming the black sheep that wants to fool people into a pyramid scheme.
- The money lays in recruiting people into the business, not in the actual products.
- You have to spend +$100/month and sell, or use 80% of your inventory, to be eligible to earn a commission.
- You have to earn 2500 points to be able to qualify as an independent distributor, which often forces you to purchase expensive starter packages.
- Pay attention to this con a bit extra!! The products are difficult to sell, since they are quite pricey. Yes, this was the problem many times when trying to sell. The products are ridiculously expensive, so it is almost impossible to sell them!
Who is Nu Skin For?
- Nu Skin is for the person that is comfortable with recruiting (mostly bothering) family and friends to get them to join, so you can grow your down-line and make an income.
- Nu Skin is for the person that has tremendous sales skills and can convince people to join a pyramid scheme.
- Nu Skin is for the person that not really care for selling products, but more want to focus on the “business opportunity”.
- Nu Skin is for the person who wants to keep paying the monthly ADR program to have a 14.9% chance to make a full-time residential income.
Well, how does this sound? Not too good to right!?
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Final Summary of My Nu Skin Experience
I realize that when stepping into this I was blindfolded because I believed in my friend and her success story.
She claimed to have made such a good residential income, from doing the Nu Skin business back in Sweden, that she could buy her own spa and live off the money.
When I asked her why she stopped (she had taken a break from Nu Skin when we met), she just said she got tired of it and wanted to do something else.
Why getting tired of a residential income? You never get tired of money in this consumer society.
Something was fishy with that story.
Since she recruited me, she automatically became my coach (up-line). When experiencing the tough reality of constantly getting turned down, and only 1 sale, I was temped to ask her for income proof from when she did so well.
She never showed me anything proving she made money from Nu Skin and I did not want to disrespect her, and our short friendship. I did not want to come off like I did not believe what she was telling me and offend her.
I am saying short friendship because this situation strained our relationship. I could not help feeling a bit fooled by her, investing in all those products and efforts for nothing.
Remember, that she also made a commission from my $1000 investment in products and also from being in the ADR program for three months, since I was in her down-line.
That is how the business model works.
Furthermore, I always had the feeling that she was competing with me. If you guys recognize the feeling when a person act nice to you, but you feel it is not sincere and with a hidden agenda.
She knew that I am an entrepreneur and was probably hoping for me to grow a good organization to get her finances going, but at the same time did not want me to do better than her.
We were both career driven, strong minded scorpio women, so maybe she felt a bit threatened by our similarities.
Later, it came to my attention that she had back-stabbed me pretty hard, but that is another story.
My Final Advice is – If Someone Approaches You and Tries to Recruit You to Nu Skin, or Any MLM Company, Run!
You will end up investing more money and time than you will earn. It is such a small percentage that makes a good profit from these business models.
I believe you have to have a huge network in form of business contacts, or a comprehensive email list to be able to succeed. You cannot just turn to family and friends, or people crossing your path in the street.
You also may have to pay for other marketing efforts, such as Google Adwords, Facebook ads etc to spread the word and get people to buy products from you.
You will not sell enough products to benefit without help expanding your network. Take my word on it.
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I gladly accept feedback and comments on this article, Nu Skin, or the Wealthy Affiliate program. You may have a totally different perspective and maybe also have another experience from being a Nu Skin distributor.
Stay out of trouble!
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