Ac·cru·al (ə-kro͞o′əl) n. 1. The act or process of accumulating; an increase. 2. Something that accumulates or increases. accrual (əˈkruːəl) n 1. the act. MyICLUB.com Commonsense Guide to a Starting Successful Investment Club (NEW!) Want to learn how to start and run an investment club? In this comprehensive new ebook. Become financially independent through property investment under the guidance and direction of Jacques Fouché and his team. The IGrow Property Investors' Club guides. The violence prevention program founded at the Omega Boys Club, a nationally recognized youth development and violence prevention organization. Lyoness Review: Cashback and investment returns? Over the past year or so I’ve had a few requests from readers to review the Lyoness MLM business opportunity. The first time this happened I added Lyoness to my review list and when the time came went over their site to start my research. A few hours and a massive headache later, I closed my browser window and gave up. I concluded that Lyoness had put so little thought and effort into the coherency of explaining their business, that it simply wasn’t worth my time to try to understand the business model. Taking recent strides to beef up their US presence however, Lyoness has finally realised that their business presentations and information desperately needed a massive overhaul. Armed with some decent and clear information on the company and the business model, I’m now able to present a complete review of the Lyoness US business opportunity. Foreword: Please note that for the purposes of this Lyoness review I’m solely analysing the US division of the company. As far as the international Lyoness opportunity goes it’s still painfully impossible to understand and not worth wasting my time trying to dissect it. The Company. Lyoness is headed up by CEO Hubert Freidl (photo right), who founded and launched the company back in 2. I’ve seen Freidl referred to as a mathematician but I’m not exactly sure what he was doing prior to 2. MLM. There doesn’t appear to be too much information out there. The Lyoness Product Line. Lyoness itself doesn’t have any products that members can sell. Rather, the company’s members market membership to the company to new members. Once a member of Lyoness, members are issued a “cashback card” which can then grants the user a cashback on specific purchases from partnered retailers (loyalty partners). The Lyoness Compensation Plan. Whereas the Lyoness international compensation plan is confusing and presented poorly, Lyoness in the US have stripped out some of the more confusing aspects of the plan and streamlined it down. Retail Cashback. Not really a commission but still effectively money in a Lyoness member’s pocket, the Lyoness cashback is effective on all purchases (online and offline) and giftcard purchases from selected retail partners. The cashback amount varies between 1 and 2% and is paid out weekly (minimum cashout balance is $1. Additionally, a 0. Accounting Units. Accounting Units are where the Lyoness compensation plan starts to get a little complicated. Starting with you, every member you recruit is placed below you and forms your downline, along with any members your recruited members recruit and so on and so forth. For the purposes of accounting units, Lyoness use a binary compensation plan system. Starting off with the initial two member positions under you, each of these sides is a seperate team. For each $7. 5 earnt in commissions generated, paid out in cashback bonuses (both direct cashback and referral cashbacks) or $7. For each accounting unit you generate, when 3. When four of your personally recruited downline members have each generated at least one accounting unit, you can also claim a loyalty cash bonus which further increases the accounting bonus commission payout by $1. The $6. 75 must be spent with a Lyoness retail partner, whereas the $1. In addition to the $7. Lyoness also offer four other tiers that function in the same manner as the $7. AC I accounting unit commissions: AC II – $2. AC III – $6. 00 (2. AC IV – $1. 80. 0 (2. AC V – $6. 00. 0 (2. Membership Ranks. Within the Lyoness compensation plan there are a total of 8 levels of membership. At each level members are awarded a bonus as well as an increase on the amount they earn per accounting unit they receive a bonus on. Members gain membership ranks based on the number of accounting units they have converted into cash returns. Joining Lyoness. Membership to Lyoness is free. There are no fees whatsoever to become a member of the company. Conclusion. On the surface, Lyoness looks like a regular enough cashback member rewards scheme and that part of the business I have absolutely no problem with. You sign up for free, you shop and you earn a 1- 2% cashback and a 0. If this was the extent of the Lyoness compensation plan then, apart from it not really being MLM my conclusion would stop short here. The inclusion of “accounting units” however throws the entire Lyoness business model into question and raises some serious questions. From a rewards viewpoint, the idea that members can earn an additional commissions as members in their downlines accumulate accounting units is solid. What Lyoness then do however is allow their members to purchase these accounting units themselves. Jump start your Lyoness benefits with “Down Payments” against a specific gift card order for future purchases. The down payment is converted into units, which are placed in your Lyoness accounting program. Being a “down payment”, as I understand it the money stays with Lyoness itself as nothing has been purchased from any retailer. At a later stage you could cash out a gift card but there doesn’t appear to be any onus or requirement to do so (you can’t redeem the money as cash so it makes sense to request a gift card). Effectively you pay your $7. Lyoness and they give you an accounting unit. Then after between 2. With how much you are paid and the amount of people needed to create accounting units above and below you directly tied into the value of your own accounting unit, it’s very hard not to see this as a return on the money paid to Lyoness for an accounting unit. Lyoness themselves even encourage this: Become a Business Member. The fastest way to become a Business member is by making a down payment of $3. Down payment: $ 3,0. Loyalty Credit: $ 1. Loyalty Commission: $ 9,1. Total Benefits: $ 2. In the above example, ignoring the loyalty credit, the investing member has generated an effective 3. This return is generated and paid out solely on the condition of getting other members to invest in their downline. Now as far as I can tell, the only difference between a business member and anyone else in Lyoness is the $3. Given that you can entirely bypass the purchasing of products from retailers and cashback side of Lyoness and just focus on purchasing accounting units with your own money and encouraging others to do the same, it’s hard to not look at it as an investment scheme. Effectively, the Lyoness compensation plan can be broken down into five investment plans: AC I – invest $7. Lyoness and once 7. Lyoness will pay out $8. ROI + 9. 00% credit ROI = 1. ROI)AC II – invest $2. Lyoness and once 6. Lyoness will pay out $1. ROI + 5. 66% credit ROI = 8. ROI)AC III – invest $6. Lyoness and once 5. Lyoness will pay out $4. ROI + 4. 00% credit ROI = 7. ROI)AC IV – invest $1. Lyoness and once 5. Lyoness will pay out $1. ROI + 4. 00% credit ROI = 7. ROI)AC V – invest $6. Lyoness and once 5. Lyoness will pay out $4. ROI + 4. 00% credit ROI = 7. ROI)Note that if downline members make multiple investments individually, less people overall are required to invest to reach the targets of 7. Also if the initial investor does not meet the cash return requirements (loyalty commissions), these ROIs are still paid out but go to the first available qualifying upline member. Obviously not all of these counted units are going to be straight cash injections into the company and no doubt a lot of legit cashback accounting units are created, but the fact remains that the above scenarios are readily occurable. Moreso when you consider that each member is relying on money being pumped into Lyoness by their downline (people they’ve recruited and people their recruits have recruited). Lyoness do state thatdown payments are neither investments nor loyalty credits, they are down payments on a specific gift card order for future purchases. But given that there’s no requirement to put the money towards an actual purchase pending a ROI payout, I don’t see how members injecting money into Lyoness for a guaranteed return upon certain conditions (people above and below you creating accounting units) isn’t just a straight out investment with a paid return. Finally there’s the question of revenue. Lyoness charge no membership fees and as far as retailers go, they are charged a once off registration fee of between $3. USD and then just $2. USD a month thereafter. Even with thousands of stores participating, when you consider how many members Lyoness claim to have (in the millions)… it’s clear that at $2.
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. Archives
October 2017
Categories |