Avon MLM Review: Legit or Pyramid Scheme?

As someone who's been in both internet business and MLM, I have a unique view of Avon. I used to work with Avon's MLM, but now I run my own blog business. I know the ins and outs of selling beauty products directly and the challenges it brings.

In this review, I'll look at Avon's MLM model, products, pay plan, and how they do business overall. Drawing from my own experiences and what I've learned in the online world, I'll give a fair look at Avon's good points, bad points, and if it's a good fit for new entrepreneurs.

Let's dive into Avon's MLM setup and find out if it's the right choice for anyone looking to join this famous beauty brand's business.

What is Avon?

Avon is a company that sells beauty products directly to customers. It started way back in 1886 by a guy named David McConnell.

At first, McConnell was selling books door-to-door, but then he switched gears and started selling perfume when he realized women liked it more. Avon has grown a lot since then and now offers all sorts of beauty stuff like creams, mascaras, lipsticks, and more.

It's super old and is the second-biggest multi-level marketing (MLM) company worldwide, with over 6.5 million people selling its products. In 2005, Avon changed its setup to become an MLM company.

Avon MLM Products

Avon sells lots of stuff like makeup, skincare, and things for personal care. They make their products in more than 39 countries and are known for being cheaper than other companies that sell through MLM. People really like their lipsticks.

Avon is serious about making sure their stuff is safe. They have scientists in a research center in New York who check everything carefully. Their products go through lots of tests to make sure they're safe.

They make their stuff in different places like North America, Europe, and Asia to sell to different people.

Avon cares about making good quality stuff and also tries to be kind to the environment when picking where to make things.

What is MLM and is Avon an MLM?

MLM stands for multi-level marketing, a way of doing business where you make money by selling stuff and getting others to join in. Avon is an MLM company.

Here's how it works: Instead of getting a regular paycheck, you earn by selling products to people you know and by bringing more folks into the business. When you recruit someone who starts making sales, you get a cut of their earnings. This happens over multiple levels, kind of like a pyramid.

Think of it like this: You recruit 10 people, they each recruit 10 more, and so on. You earn a slice of what everyone in the "triangle" sells. Those below you are your "downline," and you're their "upline."

While you can make money by selling products, many folks like the idea of recruiting because it can lead to a steady income without doing much work. Avon sellers try to build big downlines to keep the cash flowing with little effort.

Diving into Avon’s intentions

Avon, famous for its well-liked items, might spark curiosity about how it operates. While it sells products, its emphasis on recruiting raises concerns about pyramid schemes. Avon doesn't share income details, making it tough to understand where money goes.

Despite lower earnings, Avon keeps recruiting aggressively, valuing the "opportunity" more than sales.

Considering that 99.6% lose money in MLMs, Avon's changes seem suspicious. The fees to join and purchase products weigh heavily on representatives, indicating they're more like customers than business owners.

Prioritizing recruitment over product sales makes one wonder about Avon's intentions.

MLMs versus Pyramid Schemes

MLMs (Multi-Level Marketing) and pyramid schemes often get mixed up, but they're different. Let's break it down.

MLMs: You can make money by selling products and recruiting others. Avon is an example. It's legal because selling stuff is a big part.

Pyramid Schemes: The focus is on recruiting. People invest money to join and earn by bringing in more members. Trouble is, when new recruits dry up, it collapses. That's illegal and many lose cash.

MLMs have products to sell, which keeps them on the legal side. But some pyramid schemes pretend to be legit MLMs by selling stuff. If most cash comes from recruiting, the FTC can step in.

To figure out if Avon is a pyramid scheme, we gotta look at how it does business.

Is Avon a Pyramid Scheme?

Avon changed its way of doing business about 15 years ago. Instead of just selling their stuff, now their representatives also try to get other people to join in. They call this a "multi-level marketing" or MLM model.

But just because they recruit others doesn't automatically mean they're a pyramid scheme.

Avon seems to be really pushing the recruitment side of things. They even ran big ads during events like the 2009 Super Bowl, focusing more on making money by recruiting than on the products themselves. It's worth noting that even when their sales were going down in 2009, they were still aggressively trying to get new reps. This makes some people worry about their priorities.

Avon's own executives have talked about how they rely a lot on recruiting to make up for fewer people buying their products. Plus, their 2009 report to the SEC (that's like a big financial report) shows this too.

So, while Avon might not be a pyramid scheme exactly, the way they do things raises some red flags. They seem to be really into recruiting, maybe even more than selling their products, which is a bit sketchy.

Top Ways To Make Money With Avon

Here are the top ways to make money with Avon: 

1. Sell Products: You can earn 20%-50% commission on what you sell. 

2. Recruit Others: When someone you recruit spends $150 in their first 2 months, you get a $20 bonus. 

3. Sponsor Bonus: Earn a 3% bonus on what your recruits sell. 

4. Promotion Bonuses: Get extra bonuses as you move up in rank. 

5. Mentor Bonuses: Earn bonuses as you become a better leader. 

6. Generation Bonus: Receive a 70% bonus on your team's sales. 

7. Leader Bonus: Earn bonuses based on the sales of leaders below you.

Avon MLM Compensation Plan

Avon offers a way to make money by selling their stuff. Their payment plan has 4 levels: Promoter, Ambassador, Leader, and Executive Leader. Each level has Platinum, Gold, Silver, and Bronze parts. The higher you go, the more you earn. You can get extra money from doing well and leading a team.

You earn money from selling products and your team's sales, not from recruiting others. To join, you pay $10 and get a starter kit that costs $25 to $75. You need to sell $50 to $200 worth of stuff each month to stay active.

Avon also helps with causes like breast cancer and domestic violence through the Avon Foundation for Women.

Pros and Cons of Joining Avon MLM 

Pros: 

1. Avon has been in business for over 130 years, showing they know how to stay successful. 

2. Low startup cost of just $25 for products to become a representative. 

3. You're a representative, not an employee, so you can set your own schedule. 

4. Avon offers a commission percentage of up to 50% based on sales volume. 

5. New representatives receive support from team leaders to help build their business. 

Cons: 

1. Running an Avon business requires a lot of work, time, and selling effort. 

2. There may be competition from other Avon representatives in your local area. 

3. Avon's branded websites for representatives are similar to millions of others. 

4. Traditional promotional methods like home parties and brochure distribution are emphasized. 

5. To earn big, you'll need to recruit a large team of motivated individuals.

Why Are MLMs Still So Popular?

MLMs are still popular because they seem like a cheap way to start a business and use a famous brand's name. Many people, especially women dealing with job loss from the pandemic and expensive childcare, like the idea of working from home on their own schedule.

But even though MLMs sound good, the truth is tough: almost everyone who joins doesn't make back the money they put in. That's because some MLMs are set up like pyramid schemes, where the people at the top make money, but most others lose out.

Who Are MLMs For?

MLMs are for people who want to make extra money, but they need to put in a lot of work. You have to sell a lot and recruit others to join under you. These are good for folks who like selling stuff and have time to spare. But, it's super important to think about ethics. Companies like Avon have done well by being honest and fair to their salespeople.

Final Thoughts

Avon isn't called a pyramid scheme by the FTC, so it's not fair to say it is.

However, there are similarities between Avon and pyramid schemes, even though it's not confirmed.

FAQs

1. Is Avon a scam? 

No, Avon isn't a scam. But it's similar to a pyramid scheme and isn't likely to help you become financially successful. 

2. Is Avon an MLM? 

Yes, Avon is a multi-level marketing (MLM) company, also called a network marketing company. 

3. Is selling Avon worth it? 

For most people, selling Avon doesn't make much money, and some even lose money. So, it's not a great business opportunity. 

4. Do you have to file taxes if you sell Avon? 

Yes, if you sell Avon, you're considered self-employed and need to file your own taxes.

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