One Giant Direct Sales Red Flag

There’s something that many people don’t pay attention to, and they truly should: MLM Income Disclosure Statements or what some call “earning statements.” These very simple, one-pagers disclose low, average, and high earnings based on each direct sales company’s representative rank categories. For example, you can find the difference in average earnings among entry level representatives and those in a higher “level.”

My question is this: Why aren’t all DS companies putting this information on their company websites? A few have them; a few do not. This is important information for prospective reps to read, and if the company isn’t willingly disclosing it, it’s a pretty large red flag.

What it comes down to is this: The numbers don’t usually look that great at first glance. It nearly always looks like over 50% of reps made 0-200ish dollars in a year. This is a bit skewed because there are companies that are very “discount-centric” and many people may sign up with the intention of the discount rather than working the business, so upon further analysis, the numbers may not be as startling as they seem.

But still. Companies shouldn’t leave this important document off of their website, and more importantly, it should be easy to find. You shouldn’t have to hound the site index looking for it or get instructions from your upline/sponsor on where to find it. It should be readily available.

Potential representatives must understand what an IDS is and how to read one. In my 10 years in and out of direct sales, no one has ever showed me an IDS. I found it myself by accident once, and I was angry that no one told me about it.

Here are links to income disclosure statements among popular, larger DS companies. There’s also a list of sites that do not appear to disclose one.

Other popular companies who are not disclosing OR have made finding the information hard to discover: Younique, Limelight By Alcone, Traveling Vineyards, Direct Cellars, Paparazzi Accessories, AMC.

If the company you’re signing with isn’t handing you an income disclosure or earnings statement, that’s a cause for concern. I don’t want to discourage you; I want to make sure you know what you’re getting into before you are sitting over 500 dollars worth of inventory wondering how to get ride of it. Know the facts. Know the numbers.

If you have IDS for the companies who I stated have not disclosed, please end them to me.

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