The Company and Products

This company began as Melaleuca Oil, selling one wellness product made from the oil of the melaleuca tree, commonly known as tea tree oil.  After running into trouble with exaggerated claims of effectiveness, the business was taken over in 1985 by Frank L. Vandersloot – and everything changed.  Under his leadership the company experienced major growth, a re-focused marketing plan, and created quality products that have the respect of the industry.  Melaleuca Inc., as it is now known, develops, manufactures, and sells over 350 health and wellness products that claim to be more effective, safer, and greener than similar products available in stores.  Company sales reached $859 million in 2007.

The Program and Compensation

Melaleuca is set up as a traditional multi-level marketing program where members are paid commissions on the products they sell and commissions on products sold by their down-line.  For less than $100 you can become not just a customer but a partner (or Marketing Executive as Vandersloot calls them) in the business and begin earning 7% commissions on all of the Melaleuca products you sell.  Distributors also earn 7% on the sales of their down-line – or other distributors that they have recruited – down to seven levels.

Analysis

The answer to who is selling Melaleuca would be stay-at-home moms, people wanting a supplemental income, and customers that want to pass along a product to others that they are passionate about.  There is no doubt that the Melaleuca line is made up of high quality products, and loyal customers rave about the effectiveness of these products as well.  But as a business opportunity the case for Melaleuca is weaker.  One reason for this is the standard MLM practice of requiring the distributors to purchase a monthly amount of product to remain active in the business.  To earn the necessary 35 points, you need to purchase around $80 worth of products each and every month.  This does allow you to receive the 30-40% discount on those products, but the line is generally more costly than similar products you would buy in stores.  Another reason to doubt the program is that the marketing methods are very traditional with a focus on selling to and recruiting family and friends, handing out samples and brochures, and posting flyers to attract customers.  There are approximately 150,000 active Melaleuca distributors – with the vast majority making less than $200 per month.  In order to make any significant income you will need to have hundreds and hundreds of distributors in your down-line who remain active month after month.  So if you love the products and want to make a little extra money each month, and do not mind talking to friends and family about your business opportunity, then Melaleuca might be a good choice.  If you are more interested in making significant income, want to avoid selling to family and friends, and want to find a business that utilizes the global reach of the Internet, I recommend that you look elsewhere.

**Keith Hartung strives to be a servant of God, a committed husband, and a loving dad.  He is also an internet marketer and home business coach, working with people around the world to create financial success in their lives by leveraging the power of the Internet. To see how Keith is making money online enter your information in the form on the right.