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Herbalife Ltd. Message Board

  • singhlion2001 singhlion2001 Apr 4, 2013 8:15 PM Flag

    The big questions? Will Herbalife actually cut off these wholesale customers from the income opportunity (making them true customers) and will said wholesale customers stick around after being cutoff from earning anything?

    Herbalife to track wholesale customers in April
    As good an admission as any that there are some serious problems with Herbalife’s current compensation plan and business model, the company announced today that it ‘will more clearly identify the wholesale customers among its 3.2 million distributors from April’
    The big questions?
    Will Herbalife actually cut off these wholesale customers from the income opportunity (making them true customers) and will said wholesale customers stick around after being cutoff from earning anything?

    Herbalife disclosed that the decision to create a wholesale customer class in April came about after it held ‘short discussions with Carl Icahn‘.
    Icahn is an investor in the company who currently holds a ‘13 percent stake in the company‘. Why an MLM company is only now taking action and direction (from a stock investor no less) I have no idea.
    On an investor call, CEO Michael Johnson stated that ‘beyond that (discussions with Icahn), there’s nothing concrete to report‘. Whether or not a regulator has stuck their finger into the Herbalife pie and prompted their decision remains to be seen.

    Sentiment: Strong Sell

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    • irs should take a look at this. why would "wholesale customers" who are faking HLF distributor label to get 25% discount (retail users lying to get wholesale price for self consumption)... but writing off home office expenses of being an HLF distributor... whoa! IF HLF reclassifies this - then clawback of HLF distributor-now-really-"wholesale customer" deductions taken from IRS by 1000s of former HLF "distributors" could technically be argued to be fraud. HLF retail users using newly issued HLF wholesale label to score a 25% discount on product ---self consumed? tacky tacky tacky. sticky wicket w/ IRS...

      like me buying Clorox bleach or Coca cola...and writing off a couple rooms in my house as Clorox and Coke distributor home offices ...taking a fat deduct from IRS... but using the junk myself. What's the difference? (as we see the IRS scowl...)

      where do these top brass dudes think this shiz up? amazing... do they consider the tax ramifications to their 1000s of "distributors" at all? If HLF has "suddenly" realized their distributor model is not true -- can IRS hit distributors back ???years for HLF newly edicted but now fradulent changes? wow... if IRS hits all these distributors for expenses at this level -- can they as a class sue HLF for all these charges...since HLF thought up the scam - now IRS is hitting them for the scam -- thus they were hoodwinked as a class so have some cause to push all these falsely claimed deductions, penalties, interest - as a class - back to HLF to pay?

      fun times ahead.

    • Distributors cannot be preferred (wholesale) customers, the two classes are at odds with eachother definition wise.
      Anything short of creating a wholesale customer class cut off from the compensation plan will prove today’s announcement to be nothing short of marketing spin.
      Now that they’ve made the announcement (who didn’t see it coming?), Herbalife have to follow through. Otherwise they are pretty much confirming that without constant recruitment of new distributors their business won’t survive, making it a pyramid scheme.
      You can’t claim that most of your distributors are wholesale customers not interested in making money and then refuse to create a true wholesale customer class because it will kill your business.

      Sentiment: Strong Sell

    • there’s no way herbalife will make a preferred customer class cut off from the income opportunity . they might as well sign their own death warrant.
      they will insist that 25 % discount is available only to distributors and allowing direct retail from the company at this discount will kill the market for their true distributors. so if anyone wants to enjoy the 25 % discount they have to make the sacrifice of joining as distributors, and can be given another fancy neo name.
      in short they will classify their distributors in different categories but NO preferred customers.
      if i had money like ackman does, i would have bet on this .

      Sentiment: Strong Sell

 
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