AdvoCare has been in confidential talks with the Federal Trade Commission about the AdvoCare business model and how AdvoCare compensates its Distributors. The planned change will impact Distributors who have participated in the multi-level aspect of the business. Those who currently sell only to customers will not be impacted and there will be no impact on Preferred Customers or retail customers’ ability to purchase products.”
What does that mean?
AdvoCare is a 28 years old company that has distributed their products by the MLM method, meaning that people could join and help build the network of independent distributors and sell the products. When you recruit other people into a MLM company it is hard work, and to train them and teach them how to become successful takes time, but the reward is that you will get percentages of all products that are traded in the team they have build.
Let me say, that I do not have any confidential information on this company or what has happend, but I can see the consequences of what is going on right now, and I think it has some value for all of us to learn from.
First of all, when a company in this way suddenly changes its contract with its representatives, it has consequences for families that are relying on the income from that company and people who has invested time in building their business are losing a lot.
I personally feel really sorry for these people, although it´s a risk everyone in MLM takes when signing up with a company. Can we really trust a company to take take of our business? Both yes and no, a lot of companies will proberbly not do what AdvoCare has done. It seems from the outside, like AdvoCare had warnings from the FTC before they threw in the towel. Why didn´t they try to make it right before it went so wrong? I cannot say since I do not know what has gone on behind closed doors. From what I can read other places it seems that the problem for AdvoCare was that the ratio with volume from reps was to high compared with the volume from customers. So if you are in a company where your main income is from the products that the distributors have to buy to stay active, you should feel insecure. Every network has to have a ration of more volume from customers that distributors or at least 50/50.
But I do know that everyone in MLM must realise that we do NOT have our own business, we have a business with the company we have signed up with and our faith is in the hands of that company unless we are wise in our choices. Does this mean that I do not recommend MLM. On the contrary. I love mlm, and will recommend it for a very long time, but people need to be wise with the money they earn from mlm, and they need to take that extra money they earn and pay out debt or invest it in something more stable. Some people say that they have found the company that they want to be with for the rest of their life, but we do know that stuff happens. So take precaution and be wise.
Also build your own brand, and build more that one income. Don´t build teams in dífferent MLM companies, but make sure that you are not exclusively relying on your MLM company.
This is not the first time something like this has happend and it will not be the last. Companies closes, goes bankrupt, end contracts with reps for whatever reason and if you have not put money a side or have another income you could be on the street with no income with very little notice.
If you are a AdvoCare rep, I send you my deepest condolences for your loss. I understand that it can be hard to realize what this change will do to your business and your life, and I hope that this will be a lesson somehow and that you will not give up on the whole industry. So many other good companies will be happy to have you and what you have learned in AdvoCare nobody can take from you.
To everyone who thinks that this is the perfect opportunity to go after AdvoCare distributors to try and sign them into their company, please don´t. To be in thsi situation and get al kinds of spammy messages is the worst. Leave them alone, and if you have build good solid relations and done a good job on building your personal branding, you might get someone to contact you.