An Overview of Direct Sellers’ Compensations
Is it possible to make a six-figure income through network marketing? Do all participants earn substantial amounts? Are high-earners so few? How are companies’ commission payouts distributed?
Let’s find out the answers in 10 direct sales companies’ own reports. These 10 companies covered in this review are of varying sizes in sales volumes. Unless otherwise stated, sales and field force figures are from DSN Global 100 List. Direct seller income figures here do not include retail profits.
2016 Sales Volume: $328 million
Sales Force: 362,000
In 2016, those who received commissions constituted approximately 20% of 4Life’s worldwide field force and roughly 80% did not earn any such income.
Out of this 20%, less than 1% (i.e. < 0.2% of all) earned an average of $2 million/year. 5.4% of those who earned commission income made an average of $7,400 on an annual basis. 4Life paid to 89% of this group an average of $700/year.
Click here for 4Life Research’s 2016 compensation report.
2016 Sales Volume: $586 million
Sales Force. 549,357
0.06% of all AdvoCare distributors’ average yearly income was more than $100,000. 0.4% earned between $10,000-100,000 in 2016, 24% earned less than $1,000, and 72% did not receive any payments from AdvoCare.
Click here for AdvoCare’s 2016 compensation report.
2016 Sales Volume: $4.5 billion
Sales Force: 4 million
In 2016, 14% of Herbalife distributors received earnings from Herbalife in the U.S., and 86% did not receive anything from Herbalife.
50% of the 14% of those who were paid (or 7% of all U.S. distributors) made less than $370. 10% earned more than $7,000. And 1% (about 649 distributors) made more than $100,000.
Click here for Herbalife’s 2016 U.S. compensation report.
LifeVantage’s figures cover July 1, 2016 and June 30, 2017. Within this period, LifeVantage made commission payments to 48,500 distributors in the U.S. out of 63,000 (77%).
Less than 1% of the 48,500 U.S. distributors earned $1.3 million per year on the average. 18% made about $1,000, and 40% made $290.
Click here for LifeVantage’s 2016-2017 U.S. compensation report.
2016 Sales Volume: n.a.
Melaleuca’s September 2016-August 2017 report states that 79% of those who buy Melaleuca products each month in North America were strictly customers who were not interested in the business.
“Product Advocates” who have at least one customer made up another 10%, and “Business Builders” constituted the remaining 11%. “Corporate Directors’”, the highest title-holders’ average annual income was $1.2 million. The report does not reveal information as to how many distributors were at these income levels.
Click here for Melaleuca’s 2016-2017 North America compensation report.
2016 Sales Volume: $2.2 billion
Sales Force: 998,000
The average commission that Nu Skin paid to its U.S. active distributors was $2,200 on an annual basis in 2016. On a monthly basis, an average of 20% of U.S. active distributors earned a commission from Nu Skin.
Nu Skin’s highest rank, “Blue Diamond Directors” were about 0.3% of the actives and earned $460,000/year on the average. Approximately 10% received $380.
Click here for Nu Skin’s 2016 U.S. compensation report.
In 2016, 56% of Rodan + Fields consultants in the U.S. received a payment from the company whereas 44% did not earn any compensation. The average yearly commission income for the top 0.04% was $1.2 million. More than 30% received $2,300 on a yearly basis and the average yearly income for 60% of Rodan+Fields consultants was $334.
Click here for Rodan + Fields’ 2016 U.S. compensation report.
2016 Sales Volume: $456 million
Sales Force: 131,000
196 Scentsy consultants in the U.S. with the highest title of “SuperStar Director” made on the average $220,000 in 2015. Average yearly income for 5,710 “Star Consultants” was $5,000 and about 60,000 “Certified Consultants” earned $700.
Click here for Scentsy’s 2015 U.S. compensation report.
Stella & Dot
2016 Sales Volume: n.a.
Sales Force: n.a.
0.2% of Stella & Dot’s active stylists in the U.S. having the titles “Executive Director and above” earned $270,000 on the average in 2016. 1.8% made $25,000, 10% made $4,100 and the average income for the lowest group that made up 73% was $1,700.
Click here for Stella & Dot’s 2016 U.S. compensation report.
2016 Sales Volume: $1 billion
Sales Force: 471,000
In the U.S. in 2016, there were a total of 42,549 active USANA Associates. 0.08% of them earned between $200,000-1,000,000. 0.3% made $50,000-200,000. The average income for 26% of USANA Associates was less than $500 per year and 58% did not get any compensation.
Click here for USANA’s 2016 U.S. compensation report.
Among several others, these statistics once again show three important things to all:
1) It is possible to achieve really high incomes through direct selling.
2) Not everybody reaches those high levels.
3) In fact, “1” and “2” above are public information that everyone has access to.
Hakki Ozmorali is the Principal of WDS Consultancy, a consulting firm in Canada specialized in providing services to direct selling firms. He is also the publisher of The World of Direct Selling, global industry’s leading weekly online publication. He is an experienced professional with a strong background in direct sales. Hakki was the first corporate professional in the Turkish network marketing industry. His work experiences in direct selling include Country and Regional Manager roles at various multinationals in Turkey and in Canada. You can contact Hakki here.