Herbalife is a popular weight loss healthy shake. They have items such as protein shakes, meal drinks, and pre workout powders. This successful business also has their company name over the largest MLS soccer team jersey the LA Galaxy. However, this promising company is now under investigation for how they sell and market their product. They are saying it is basically a pyramid scheme. They defend themselves claiming it is no different then any other companies using a multi level marketing style. The day the accusation came out Herbalife stock dropped by 30 percent and most likely will continue to fall. This article caught my eye because I had a few friends that sold Herbalife. It didn't seem as if they were getting ripped off by selling their product. On the other hand this investigation seemed to be very similar to a company known as Verve. I also had friends sell this and they did get ripped off. Verve is an absolute pyramid scheme and I bet if they ever get as big as Herbalife they would get probed as well.
http://money.cnn.com/2014/04/11/investing/herbalife-shares/
I have heard of other products like this, friends of mine have also tried selling me things like this and they seem pretty easy to identify as a scheme.
ReplyDeleteIt's a shame to see businesses using scheme like this to make a profit. It lowers consumer confidence and hurts their trust. It just makes you question new products that go out on the market.
ReplyDeleteI agree. Schemes like this are not only unethical but can be dangerous to other businesses.
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