The current economic climate has left many looking for home-based employment that will help them make ends meet. Unfortunately, numerous companies have positioned themselves to profit off these desperate individuals by luring them into multilevel marketing schemes. One nutritional supplement company has earned a bad reputation; before you invest in this business opportunity, learn more about what many are calling the Usana scam.
Who are they?
A publicly-traded company, USANA Health Sciences, Inc. (NYSE: USNA) is a multilevel marketing business that make several different skin-care and nutritional products, most of which are made at its Utah facility. The company sells its products in over a dozen international markets using independent distributors, much like CutCo and Mary Kay, Inc.
The good and bad
From 2004 to 2006, the company appeared on Forbes list of the 200 Best Small Companies; however, in 2007, the San Diego Reader published an article noting that SEC and FBI were investigating the business as a potential illegal pyramid scheme. That said, reportedly, the investigations turned up no wrong-doing, and the company enjoys an A+ rated from the Better Business Bureau.
Why are people upset?
Although the company appears to be on the up-and-up, there are numerous online reviews complaining about a Usana scam. This is somewhat typical of any multilevel marketing business, in which distributor profits rarely match up with expectations. The Salt Lake City Tribune published an article reporting the average earnings of the company's associates at $617 to start, with top-level distributors earning $857,865 annually; however, according to Dr. Murray H. Smith, a statistician for the New Zealand government's Commerce Commission, very few of the company's distributors are likely to earn great wealth, and he claims "you can make a very strong argument that this could be a pyramid scheme."
Does Usana scam its distributors?
Many multilevel marketing operations are accused of scamming their distributors, because most require that their associates purchase their products before they can sell them. In the end, although it's earned a bad reputation, this particular business doesn't seem particularly unscrupulous. If you're a good salesman; you may be able to make it work. If not, you'll probably be better off looking for a business opportunity on a site like SnagaJab or Monster.com.