Everything You Need To Know About The Younique Pyramid Scheme Scam

322 Views Updated: 18 Nov 2018
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Everything You Need To Know About The Younique Pyramid Scheme Scam

There’s a lot of multi-level marketing companies out there that offer the opportunity for “women to empower other women” through selling beauty products and being their own boss. There’s Avon, MaryKay, SeneGence - to name a few - and one that’s recently making a name for itself: Younique.  

The company was started by brother and sister Derek Maxfield and Melanie Huscroft in September of 2012. What separates Younique from other MLM’s that sell beauty and skin care products is their Younique Virtual Party System™ which allows their presenters - which is what they call their sales representatives - to sell their items through online parties. Unlike the traditional Tupperware parties your grandmas and moms are used to, a presenter can invite her friends or potential customers to a Facebook group where they can talk about the products and sell them at the same time. This strategy is one of the great draws that lure women - especially stay-at-home moms and those that are looking to supplement the income they’re getting from their 9 to 5 jobs. The idea of being able to sell your product in your own time without having to go out of the house or spend money hosting a real party in your own home is very appealing to most women and especially stay-at-home moms.

The big question is, is Younique a legitimate business or just another pyramid scheme?

By definition, a pyramid scheme is a business model that:

● Promises members commission just by recruiting others

● Does not offer any service or products to which members can sell

● Uses the membership fees from each recruit to fund membership payouts


Technically, Younique isn’t a pyramid scheme because there’s an actual product that presenters can sell to make a profit. Younique presenters are actually required to make $125 in personal retail sales (PRS) in a 3-month rolling period to remain an active member, or else their accounts will be deactivated, and they’ll need to buy themselves in again. References like networkmarketingnow.com essential tools that can help with research.

The Products They Sell

Younique sells a variety of eye, face, and lip products at around $20 to $65. Aside from cosmetics, they also have skin care products, makeup tools, and fragrances. However, they’re most famous for their Moodstruck 3D Fiber Lashes+™ mascara that promises “500% increase in average volume” of your lashes at $29 a piece.

One of the most common complaints with MLM companies is that they sell products of inferior quality at exorbitant prices. The mascara, as well as their other products, have received tons of mixed reviews all over social media. With that said, you’ll need to do proper research to judge their items for yourself.

Their Compensation Plan

Aside from pushing their presenters to sell their products, Younique also compensates them for bringing in recruits. You’ll first need to pay $99 for their starter kit which includes cosmetics and other items that sum up to $300 in retail value. They also categorize members by status:

White status - where you need to have a Lifetime PRS of $125 and you get 20% commission on all sales.

Yellow status - you need to have sold $1000 worth of items to get a 25% commission on all sales.

Pink status - this status is where you’ll be required to recruit at least one presenter in White status, have a monthly PRS of $250, and a total of $2000. You get 24% commision and 3% from your downlines.

From then on, there are different sales requirements and number of recruits that a presenter needs to meet before earning their commissions until they reach the Black status which is the topmost tier level.

So Is It Worth Starting Your Own Younique Business?

Well, that’s entirely up to you. Before making any decisions though, here are some important considerations to ponder on:

● Even with a rewarding compensation scheme, only a tiny percentage of Younique presenters make it to Black status. This is no different from any other MLMs where most participants drop out just after buying it, and only those at the very top are the only ones really earning.

● To be able to meet the sales requirement and get your commission, you need to sell, and you need to keep doing it every month. This means setting up online parties, following up on previous customers, and continuously expanding your social circles to generate new customers.

● You really have to work hard on recruiting presenters and helping your downline to recruit their own. Note that as you multiply, recruiting becomes virtually impossible because the market eventually becomes saturated.


Conclusion

The bottom line is there’s no business, whether MLM or not, that offers guarantees. The best you can do is to educate yourself to be able to make an informed decision to commit to any kind of venture.

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Posted by: Fakhruddin Posts: (90) Opinions: (2) Points: 3,027 Rank: 38
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