I think the main difference is that there is a chain of people who profit from selling to their 'downlines', not when a product is sold to an actual customer.

The analogy to apple is poor. Apple sell a product that the majority of people like and they are actively trying to sell directly to the customer. They use networks as it is their only option in many markets and once a phone is sold to the network it is then sold to the customer, there isn't a series of transactions with each level profiting of the previous level.

>I think the main difference is that there is a chain of people who profit from selling to their 'downlines'

How is it different from 3rd party Apple resellers?

>Apple sell a product that the majority of people like

As does Herbalife.

>they are actively trying to sell directly to the customer

Herbalife lets distributors handle sales, not very different from Apple's resellers.

>They use networks as it is their only option in many markets and once a phone is sold to the network it is then sold to the customer, there isn't a series of transactions with each level profiting of the previous level.

Apple -> Authorised Resellers -> Stores. While this is not Apple's only channel (because they have their own stores plus online shop), it is one of them... and there is multiple transactions with each level profiting.

It is different because there is only one level of re sellers, these re sellers are not the only path to market for the product, and that path to market when sold through a re seller is pretty clear, ie you know Apple make the phone, you know Apple have sold it to the carrier and the carrier is now selling it to you. There are literally multiple layers but the layers are clear and none shady (with the reseller layer adding value in the form of a network connection).

Herbalife's model would be Herbalife -> tier 1 -> tier 2 -> ..... -> tier n-1 -> t n, with no real clarity on how many tiers there are.

If Herbalife's product is as good as they claim why not sell it direct to customers either online or in supermarkets? They sell through 'distrubutors' because it allows them to make a profit without having to actually sell their product to a customer, because if they were reliant on direct customer based sales no one would buy there garbage product, and they wouldn't make a profit.

The litmus test for me for a system like this is if it seems like the best way to actually make money from something is not to actually sell the product to consumers but to recruit people into your downlines then its probably some kind of pyramid scheme. I can't see a single product or market where the best product would be the most profitable when sold through a MLM network.

>If Herbalife's product is as good as they claim why not sell it direct to customers either online or in supermarkets?

For the same reason Apple made iPhone exclusive to a carrier when it launched for the first time... and for the same reason many phone companies still do it with their phones.

Apple and these phones companies do it because they make anti-competitive deals... which have seem some backlash. However, Herbalife doesn't have that because they provide additional value. Products like fitness supplements are only good if you use it in an intended way, which is what a lot of these health clubs try to do. You can buy any other food supplement, but you will not get the results. People choose Herbalife because it just works.

Apple had to make the iPhone exclusive to the launch network in the US as part of their negotiations to not have any carrier branding and for Apple to retain full control of the software. Nothing to do with downlines or shifting inventory.

Apple would clearly rather you bought the phone directly from them, their entire philosophy is based on continuous integration, from controlling the sale of their devices through to producing their own hardware and software, they are probably the least MLM like consumer electronics company going.

Do you distribute Herbalife products or do you just use them? I'm genuinely interested as no one I know who's tried them thinks they are superior product, and anyone I know who's got into anything remotely MLMy has lost money and regretted it.

I don't buy Herbalife products for the same reason I don't buy most Apple products. They are overpriced for what they are and I am capable enough to make whatever cheaper alternative "just work" for me without additional help from Herbalife and Apple. But I do understand the value they provide for many people willing to pay for it and willing to buy everything tech related and everything supplement related respectively from them.

The Apple retail price, the one paid by the ultimate, sales-tax-paying consumer, is unaffected by these levels in their channels. This model cannot tolerate more than two or three levels. There is no version of the Apple sales channel where more levels means more profits. With some MLMs it appears that the more levels the better, at least in theory.

Next to the other guys argument why apple is a poor argument. As much as I dislike Apple they are actually in the middle price range of laptop's with that kind of specs and quality.

Same for the phones. Apple ain't expensive if you assume it is a quality product.

>Same for the phones. Apple ain't expensive if you assume it is a quality product.

Same with Herbalife.