Last Updated on February 27, 2022 by Matt Zavadil
So, is Young Living a pyramid scheme?
Founded in 1993, Young Living is a network marketing company and one of the largest essential oil companies in the world.
But with this success comes accusations of being a pyramid scheme.
In this article, I’ll take a look at Young Living and a recent lawsuit brought forth and then tossed out of the courts.
I’ll also discuss the pros and cons of being in a network marketing company, why most fail at this type of business (all businesses, really), and how you can win as a Young Living distributor.
What is Young Living?
Young Living is a multi-level marketing (MLM) company that sells essential oils and other wellness products.
MLM: Young Living’s Business Model
Let’s explore the network marketing business model because that’s at the heart of the lawsuit recently filed against Young Living.
Network marketing, or direct sales, is a business model in which you sell products and earn commissions on your personal sales volume as well as the sales of people you recruit to join your downline.
The more people you recruit, the more people there are selling products, and the more money you can make.
It’s a numbers game.
Is Network Marketing a Flawed System?
The issue with network marketing is that very few people earn a large income.
Why is that?
Is it because the entire thing is a scam and a pyramid?
I argue against that.
Because most average people fail to build ANY type of business.
MLM is just fine as a business system.
It’s the people who try to make it work that most often fail to do what’s necessary to realize a profit.
It’s Not Young Living’s (or MLM’s) Fault
I know because I worked as a coach for several years with a company coaching course creators, coaches, SaaS founders, local small businesses, eCommerce companies, and MLM reps on how to put their online marketing in place.
The big failure rate doesn’t sit with network marketing only.
Most people fail in business for the following reasons:
- Lack of proper character traits
- Lack of sales and marketing skills
- Lack of time management skills
- Lack of “get after it” mentality
- Refusal to get better at the above skills
The big one?
Absolute refusal to take 100% responsibility for their success or failure.
If they succeed: “Look what I did!”
If they fail: “It’s not my fault!”
The U.S. Bureau of Labor Statistics Agrees with Me
Using statistics from the United States Bureau of Labor Statistics, we can see that only 30% of all businesses started will remain in business 10 years later. 50% are gone five years after they begin. 20% of all small businesses are out of business within one year.
The Small Business Administration reports on this as well.
MLM isn’t a pyramid scheme.
Young Living isn’t an unlawful pyramid scheme.
The “scheme” is that most people suck when building companies.
I know, I know, we live in a society now where we’re not supposed to hurt anyone’s feelings.
You know what though?
I absolutely sucked big time the first time I went into business as a young man.
I wish someone would have confronted me back then and said, “Matt, you suck at this. But, here’s how you can get better.”
That’s the key.
We all pretty much suck at network marketing when we start.
How is it reasonable for the average person, who was groomed for 22 years through kindergarten, junior high, high school, and college, to be a nice little employee…
…to join Young Living and suddenly turn into “Entrepreneur of the Year?”
Pretty unreasonable, huh?
Now that I’ve established some ground rules for our mindset around this Young Living pyramid scheme stuff, let’s look at language from the recent Young Living lawsuit.
Young Living Class Action Lawsuit
Two women (one from TX and one from CA) came forth to a federal court to say Young Living is misleading. Let’s break down a few of these specific claims.
“Aggressively” Encouraged to Recruit
They say the company encouraged them to recruit.
Yes, of course, it’s called “multi-level marketing”.
In every MLM I’ve joined in my past, I’ve hit recruiting hard baby.
Who wants to be a real estate or insurance agent doing all the calling, driving, and selling…
…when you can open a brokerage, put butts in seats, and override all the sales from those agents you provide the privilege of having a place to run their business from?
Well, in network marketing, you can recruit your army of distributors to override.
Nothing illegal going on.
The lawsuit language seems to insinuate that Young Living paid people to recruit people.
You can only override the commissions from the product sales of your downline members.
These women in the Young Living lawsuit made it sound like, “The only way to make money is by building a downline and collecting commissions off other people.”
This reflects such an absolute lack of understanding about what’s going on that it makes me cringe.
They go on to say that essential oils aren’t the true method for how distributors earn money, but only act as a way to confuse distributors and customers.
The only way money moves through Young Living or any other direct selling organization is when product sales occur.
Young Living doesn’t pay anyone to get someone to “sign up”.
All legal and above board.
“I Didn’t Make a Profit”
One woman claimed she spent more than $4500 on Young Living products and only earned back less than $400.
Is that my fault?
Young Living’s fault?
Or her fault?
I lost money in network marketing before I knew where my skills were deficient.
I built international downlines earning 5-figures monthly after improving my sales and marketing skills.
One principle every successful business owner on planet Earth understands is this:
If your business spends more than the revenue generated…
…fix it fast!
Is it easy to sell essential oils?
Is it easy to sell anything?
That doesn’t mean it’s Young Living’s fault this person decided to keep spending all that money without figuring out why she wasn’t successful in finding daily qualified sales leads and converting them into sales.
You’re not called an independent contractor in Young Living for nothing.
You’re not an employee.
This ain’t a job.
You don’t get paid to punch a clock and “try”.
You get paid for results.
Most People Lose Money In MLM
Another big “point” made in the lawsuit is that most people fail to earn much profit at all in Young Living.
I handled that above.
Most people in ALL businesses fail to earn a profit…
…and 99.999% of the time it’s because that owner doesn’t know the first thing about building a successful business.
Psychology of Multilevel Marketing
Then, we get the cultish-like “feeling” when discussing network marketing companies such as Young Living.
I can understand this, to some extent.
Although I’ve always enjoyed the MLM model from the perspective of selling products and building a team to override commissions of team sales…
…I’ve never enjoyed the “rah-rah” nature of network marketing meetings.
I’m 100% an introvert.
I don’t like all that stuff.
I just put my head down and work my ass off.
So, if you don’t like the “rah-rah” stuff…
…ignore it like I always do and simply outwork all those extroverts who love to hop around, talk big, and then never get seen where it counts…
…on the company leaderboard.
But, a cult?
C’mon, man LOL
It’s All Mental
Do you see where all this talk of pyramid schemes, unfairness, illegalities, etc, comes from a poor mentality on the part of the people bringing the lawsuits?
Instead of taking responsibility as a business owner, they’re placing blame “out there”.
As human beings, we must learn to take 100% responsibility for our successes and our failures.
Sure, outside factors play a part.
But, at the end of the day, winners figure out how to overcome that stuff.
You either find a way and enjoy a cool life.
Or, you play the victim, lose, and never enjoy the thrilling feelings of seeing residual income flowing into your bank account.
So be it…
But, never blame anyone else for it.
Do Essential Oils “Work”?
By the way, you can probably tell by now that I’m a little “old school” LOL
I see people talking about Gary Young or Mary Young, whether Young Living can make such claims about using alternative medicine to help people and their ailments, or whether essential oil ingredients can do “whatever”.
You do realize that people were “practicing medicine” for centuries before some people convinced most of the population that only drugs helped things.
I believe there’s a place for medications, but there’s also a place for working to prevent ailments from occurring in the first place.
And, I know that when I smell lavender, for example, I feel calmer.
I don’t need someone else to “prove” that.
It’s a fact because I experience it.
Know what I’m sayin’?
How To Make Money Selling Young Living Essential Oils
You’re still with me.
Let’s talk about making money with Young Living and get you selling those essential oils.
Steps to Becoming One of the Successful Young Living Members
If your goal is to be one of Young Living’s members consistently hitting the leaderboards, then you must do the following.
- Identify if you’re truly committed to this
- Identify which skills you’re deficient in
- Start improving those skills
Identify if You’re Truly Committed to This
How long are you willing to work hard until you’re an expert at selling Young Living essential oils?
If you just thought of a specific timeframe, then you’re in big trouble.
The answer should be: As long as it takes.
You see, most people fail because they give up too soon.
It’s hard work to be a top seller in any company.
And, it requires hustle, dedication, and an unquenchable desire to succeed.
If you don’t have those things…
…I suggest you find something else to do.
Identify Which Skills You’re Deficient In
The skills you need to be successful in Young Living are:
- Leadership skills
- Time management skills
- Problem-solving skills
- Prospecting for leads
- Converting leads into sales
- Closing the sale
- Building a downline or customer base
Leadership skills: It’s impossible to build a network marketing business without leadership skills. You must be able to motivate and inspire people to take action.
Time management skills: This is critical because you only have a certain number of hours in the day to sell products, find new customers, and build your business.
Problem-solving skills: In any business, problems are going to arise. You need to be able to solve them quickly and effectively.
Discipline: This is key because you’ll need to stick to a daily routine if you want to be successful in selling essential oils.
Prospecting for leads: To sell products, you must first find people who are interested in buying them.
Converting leads into sales: Once you’ve found potential customers, you need to be able to convince them to make a purchase.
Closing the sale: This is the final step in the sales process. You must be able to close the deal and get the customer to hand over their money.
Building a downline or customer base: A big part of being successful in Young Living is building a downline or customer base. This can be done by recruiting new members, selling products to existing customers, and word-of-mouth marketing.
Start Improving Those Skills
Once you’ve identified the skills you’re deficient in, it’s time to start improving them.
One of the best ways to improve leadership, time management, or discipline skills is to find books, courses, or seminars that will teach you how to get better.
If you find that you need online marketing training to begin getting daily qualified leads or to learn how to close sales, then you need to seek out people who specialize in teaching things like:
- How to start a blog
- Social media marketing, such as MLM Facebook posts
- Content marketing
- How to get daily MLM leads
- MLM scripts to use in Young Living
- Sales conversion
FAQs About Young Living Pyramid Scheme
I hope all of the above has been helpful to you. You might have additional questions, however.
What makes Young Living a pyramid scheme?
Nothing. Pyramid schemes are illegal because they focus on recruiting new active members instead of selling products. This is not the case here. The company isn’t an illegal pyramid scheme. It’s a legal multilevel marketing company. MLM is legal when the focus is on selling products to bring in revenue.
What is wrong with Young Living?
Again, there is nothing wrong with it. It is a legal and ethical company that provides high-quality essential oils and products to over 6 million active members. Some people might not be successful in selling essential oils because they don’t have the skills or they give up too soon.
Are Young Living products really safe?
Go to Young Living’s website and research it. If still not convinced, research reputable sources that will show you how the ingredients work, etc.
What is happening with Young Living?
The company is helping people use essential oils. What’s also happening is that people who want to start their own business can do so. They have the opportunity to be their own boss, earn money based on products sold, and bring in new recruits. What’s happening after that is the recruiter can earn override sales made by downline members. It’s the same opportunity for financial success provided by the incentive structure of all MLM businesses.
Is Young Living a legitimate company?
Yes, it’s a legal organization. It doesn’t matter if Gary Young is on his third wife or whatever 🙂 The company allows its distributors to make money selling essential oils or by recruiting new members.
Is Young Living a Pyramid Scheme: Final Thoughts
If you’re a distributor for Young Living, it’s all good.
You’re selling a legitimate product.
Avoid making outrageous alternative medicine claims. Build your business on honesty, ethics, and the basic facts about why people use essential oils.
Learn how to market if you’re deficient in these skills right now.
Figure out how to make enough income for your family through product sales, recruiting a team of independent distributors, and don’t worry one ounce about claims of your company being an illegal pyramid scheme.
Is Young Living a pyramid scheme?