Monat is one of the fastest-growing organizations on a global scale dealing with direct sales.
The chances are that you have already heard of Monat MLM (Multi-Level Marketing) as you can see dozens of people flaunting their Monat membership on social media platforms while advertising beauty and hair products.
Given the fact that many people are joining as partner marketers, it almost feels like the rest of the world is missing out on something.
Is Monat MLM a pyramid scheme and how do market partners make profits?
What Is Monat MLM Scheme?
Monat or Monat Global Corp is a US-based privately-owned company with HQ in Doral, Florida.
Monat is a multi-level marketing (MLM) company that sells hair care products and has expanded to selling beauty products as well after their business model turned out to be a success.
Monat is operating based on the multi-level marketing business model, which means that the company relies on marketing partners who sell and advertise their products online and via social media.
Monat MLM scheme involves market partners as a centerpiece of the systematic plan to sell Monta haircare and beauty products.
Market partners get 30% commissions on every product they sell.
In case market partners sell to a VIP member, they get 15% commissions on their sales. VIP members get 15% discounts on their purchases, which is why commissions for these sales are lower.
To become a VIP member, you need to pay a registration fee of $19.99 and have two flex shipping orders along with an enrollment order.
Who Owns Monat?
Monat Global Corp is a subsidiary of Alcora Corp. and is owned by this company.
Alcora is said to be an established company that sells beauty products, hair care products, and specializes in premium beauty and wellness products.
The key people in the company are its co-founder and chairman, Luis Urdaneta, and co-founder and CEO, Rayner Urdaneta.
Moreover, the president of Monat Global Corp is Stuart A. MacMillan, a former CEO of TelexFree, a company that was accused of running a Ponzi scheme.
Alcora Corp. also sells animal care and skincare products, which are not sold by Monat market partners.
Monat Business Model
Monat’s business model is based on multilevel marketing or direct marketing, which means that Monat has market partners who sell and market their products (much like Legal Shield in the law industry).
To join Monat as a representative and start selling their products, marketers are advised to start with their close friends and family members, asking them to find at least five people who will subscribe to Monat beauty products and pay a monthly fee.
Market partners even have to pay a fee to get started and join the program. When you apply to become a Monat market partner, you need to:
- Purchase a starter kit that costs $99
- Pay a $49 signup fee
The starter kit you are buying for $99 contains brochures and testers and is most probably a handy way for Monat to make a profit from marketers.
The fees needed for market partners to get started and join the program is one of the reasons why Monat is considered a pyramid scheme.
Moreover, Monat market partners on average make less than $100 annually.
When partners and investors can’t make profits, it might be easy to suspect that Monat is a pyramid scheme.
What Are the Monat Products?
Monat is selling “revolutionary” natural-based hair care and beauty products that are said to be vegan-friendly and designed to address the effects that chemicals that are normally used in cosmetics have on the environment.
Monat market partners are selling skincare and haircare products, with an emphasis on the natural-based hair care product line.
Products are said to be animal-cruelty-free with a Leaping Bunny certification, as well as vegan and gluten-free.
Monat also sells beauty products for the body and face, as well as supplements.
The haircare line of Monat is the most extensive by far as users can find a great variety of “systems” for haircare:
- Hydration System
- Advanced Hydrating Haircare Solution
- Magnify System
- Super Nourish
- Junior Line
- Monat Studio One
- Volume System
- Classic Confidence System
- Effortless Style System
Is Monat a Pyramid Scheme?
Officially, Monat MLM is not a pyramid scheme, but you should know that the company might have found a way to circumvent the legal framework that might classify the business model of Monat as a pyramid scheme.
Monat is making profits on market partners who sell products instead of the company and in the name of Monat, while partners need to pay a fee and purchase a pricey starter kit to join.
Although Monat is a legitimate business, the company sells expensive hair and beauty products while paying only a small portion of profits to market partners who advertise and sell Monat products.
Should You Avoid All MLM And Pyramid Schemes?
You should avoid pyramid schemes, however, not all MLM business models are pyramid schemes although it may appear so in some cases.
MLM involves marketers and sellers who are not making a stable income or are paid a salary for their work and effort.
Instead, MLM marketers hope to make hundreds and thousands of dollars based on commissions on the products they sell.
Pyramid schemes are fraudulent systems in which the money is made from a great number of recruited “investors”.
These investors don’t know that they are being paid from the money invested by more investors and that the product or a business they are investing in is worth nothing or even doesn’t exist.
There is also a great number of reasons why MLM schemes should be avoided:
- Marketers don’t make enough money for the venture to be lucrative.
- Some people that get involved in MLM are often in debt or losing money instead of making a profit.
- You are working hard for a company that collects all the profits and you aren’t being paid a salary.
Despite the downfalls, some people do make money with MLM and are rather comfortable in the role of a marketer.
Can You Generate Income with Monat?
You can generate income with Monet by selling and marketing their products online and via social media.
To start making money with Monat, you need to pay a registration fee and purchase a starter kit.
You can either work on recruiting people to join Monat or sell their products to make a profit.
Making Money by Building a Team
You can make money with Monat by recruiting people, which is said to be a more profitable option in comparison to selling products as a market partner.
The equation for making money is simple as you will earn more with a greater number of people you recruit.
There are 11 ranks to go through as you are working, and each rank comes with a different set of bonuses.
There are six different types of bonus sets:
2. Group Volume
3. Rank Advancement
4. Rank Advancement Matching
5. Motor Club
Making Money from Sales
You can make 30% of commissions for every Monat product you sell, and 15% for products you sell to VIP members. When you sign with four VIPs for a month, you will get a $60 bonus. You need to make at least $200 in product sales to remain an active market partner. The more products you sell, the more you can earn on commission. Market partners can make a profit based solely on commissions.
How Much Do Monat Consultants Make?
According to Indeed.com, the salary satisfaction with Monat is 72%, while Indeed states that an average Monat consultant makes over $5,000 a month, which is above the national average by 23%.
This information is based on 68 data points that were directly collected from employees, users, and collected job advertisements on Indeed in the last three years.
However, different sources site that 98% of Monat commissioners make less than $40,000 annually and are below the national average.
Is Monat Legit Then?
There is no clear evidence that would deem Monat as a scam or a pyramid scheme, while Monat is a legit company with a legitimate business.
Monat is not the only legitimate company that uses MLM, while this business model is popular in the cosmetics and beauty industry.
Are There Existing Monat Lawsuits?
There are many complaints against Monat’s products, deeming the product line expensive and said to have caused itching, balding, and skin irritation.
In 2015, customers also filed complaints regarding misleading advertising with The Better Business Bureau and the US Food and Drug Administration.
By 2018, Monat had hundreds of complaints that addressed serious accusations involving:
- A pyramid scheme
- Defective products
- False advertising
- Lack of integrity
- Expensive products that are not natural-based
- Hair loss
There are at least 1,000 complaints against Monat dating from 2015 to 2021.
Monat Customer Reviews
There is a great number of complaints made with The Better Business Bureau, including negative reviews.
Some reviews involve complaints about being charged for a product that the reviewers never received and not getting a refund.
Other reviewers complain of how aggressive some market partners are, stating that they only wanted to purchase one product and were signed up for a monthly membership without their consent.
One of the reviewers even claim that their credit card information was used without their agreement after buying a single product from Monat market partners.
Bottom Line – Is Monat Worth Your Time?
Monat is a legit company with a legitimate business although its MLM model may resemble a pyramid scheme, it is not deemed as such.
However, you should think twice if you are considering buying any of the products or start working as a Monat market partner as there are many complaints regarding false advertising and defective products.