MLM companies have started to promote themselves as an alternative to college.  This has come about because of the recent troubles for college students with debt and unemployment.

It is time to put these two side by side and see which one offers real opportunity.

Failure Rate

MLM: 90+% fail in the first 1-2 years.

College: 50% of students that enroll in college get a Bachelor’s degree.

Time

MLM: Now.

College: 4.5 years on average to receive a Bachelor’s degree.

Annual Income

MLM: 90+% make under $5100 per year.

$2,424 per year IBO Average Income Amway.

College: The average starting salary for college students is $45,000 for 2013.

Employment Rate

MLM: It does not offer a job and there is no guarantee of income.

College: The unemployment rate for graduates is 8.5%.  The unemployment rate for high school graduates in the same age bracket is 21%.

Cost

MLM: It is estimated that 99% of MLM members are losing money.  Starting costs range from $1000 on up.

College: It costs $13,600 per year at public institutions, $36,300 per year at private not-for-profit institutions, and $23,500 per year at private for-profit institutions. Average student debt is $13,600 at a public college and $19,700 at a private college for Bachelor’s degree graduates.

Decision

MLM: It is worthless for 99% of people that participate in it.

College: Those with a bachelor’s degrees, no matter the field, earn vastly more ($2.27 million in lifetime than counterparts with a high school diploma ($1.30 million lifetime).  It is worth almost a million dollars on average for you to get a bachelor’s degree.

What is a product-based pyramid scheme?

Sources And Additional Facts

As of last March (2011), 30.4 percent of people over age 25 in the United States held at least a bachelor’s degree, and 10.9 percent held a graduate degree, up from 26.2 percent and 8.7 percent 10 years earlier.

http://www.nytimes.com/2012/02/24/education/census-finds-bachelors-degrees-at-record-level.html

Half of students who enroll end up with a bachelor’s degree.

http://www.nytimes.com/2009/09/09/business/economy/09leonhardt.html

Industry-wide company statistics show that 90% of distributors drop out of each company within a 1-2 year period.

… according to filings with the Securities and Exchange Commission. Industry wide, multilevel marketing companies typically replace almost all of their sales representatives every year.

http://www.nytimes.com/2006/11/13/business/13short.html?_r=0

In the 2004 10-K, Herbalife disclosed: “For the latest twelve month re-qualification period ending January 2005, approximately 60 percent of our supervisors did not re-qualify and more than 90% of our distributors that are not supervisors turned over.”

Average Time to completion for a Bachelor’s degree 4.5 years.

http://www.completionarch.org/arch/indicator/4TC-28-TTD-US

There is a clear correlation between a person’s educational attainment and his or her earning power.

Young adults ages 25–34 with a bachelor’s degree earned 50 percent more than those with a high school diploma or its equivalent in 2010.

http://nces.ed.gov/fastfacts/display.asp?id=77

The average starting salary for 2013 grads earning bachelor’s degrees has risen to $45,000, up 5.3% from the average starting salary for the class of 2012.

http://www.forbes.com/sites/susanadams/2013/04/15/college-degrees-with-the-highest-starting-salaries-3/

$2,424 per year IBO Average Income – Source Amway Business Reference Guidehttp://www.amway.com/en/ResourceCenterDocuments/Visitor/ops-amw-gde-v-en–BusinessReferenceGuide.pdf

2011 Average Yearly Income For Licensed Primerica Representatives: $5,544
Source: Primerica Important Disclosures From Their Website.
http://www.primerica.com/public/primerica_disclosures.html

99% of people make under $4900 per year with the Empower Network
91% of people lose money by making under $100 per year with the Empower Network
http://www.empowernetwork.com/income.php?id=sonnyharrison1&all=1

92% Make $5,708 or less with Vemma
https://ethanvanderbuilt.com/vemma-income-disclosure/

99% lose money in MLM

http://mlm-thetruth.com/research/mlm-statistics/shocking-stats/

http://www.mlm-thetruth.com/research/multi-level-marketing-unmasked/

For the 2010–11 academic year, annual current dollar prices for undergraduate tuition, room, and board were estimated to be $13,600 at public institutions, $36,300 at private not-for-profit institutions, and $23,500 at private for-profit institutions.

http://nces.ed.gov/fastfacts/display.asp?id=76

Average Debt Levels of Public Sector Bachelor’s Degree Recipients over Time 13,600 2011

http://trends.collegeboard.org/student-aid/figures-tables/average-debt-levels-public-sector-bachelors-degree-recipients-over-time

Average Debt Levels of Private Nonprofit Sector Bachelor’s Degree Recipients over Time 19,700 2011

http://trends.collegeboard.org/student-aid/figures-tables/average-debt-levels-private-nonprofit-sector-bachelors-degree-recipients-over-time

For a product-centered MLM, where the product is the focus for compensation and bonuses, expenses will include the cost of a starter kit, marketing expenses, party-hosting expenses, Internet, phone, office supplies, travel expenses…etc. For a properly launched campaign, this could run anywhere from $1,000 per year on up. The chances of being able to start a successful MLM business with little or no upfront income is slim to none.

http://homebusiness.about.com/od/homebusinessprofiles/a/The-Likelihood-Of-Mlm-Success.htm

Education still makes one more likely to land an available job, as evidenced by the far lower jobless rate of young college graduates — 8.5 percent, on average, in the past year — compared with 21 percent for young high school graduates.

http://www.nytimes.com/2012/06/05/opinion/the-class-of-2012.html

Those with bachelor’s degrees, no matter the field, earn vastly more ($2.27 million in lifetime earnings) than counterparts with some college ($1.55 million lifetime) or a high school diploma ($1.30 million lifetime), indicating that no matter the level of attainment or the field of study, simply earning a four-year degree is often integral to financial success later in life.

http://www.usnews.com/education/best-colleges/articles/2011/08/05/how-higher-education-affects-lifetime-salary

Over 90 percent of households with over a $1 million of net worth or 95% of those with over $5 million of net worth have a college degree.

http://millionairecorner.com/Content_Free/How-to-Become-a-Millionaire—Factor-No-1.aspx