Cili By Design Review | A Real Income Opportunity or a Scam?

In this Cili By Design review I will be looking at a relative newcomer in the rapidly growing CBD oil marketplace.

Please note that this review is about the Cili By Design business opportunity and not their products, although I do discuss the products briefly to the extent they impact the business side of things.

Likewise, I am not going to comment on Cili’s retail membership programs. These programs are intended for those who simply want to purchase Cili products for their own consumption, and at the best prices, and not for those who are looking to make an income from actually selling Cili products.

What is Cili by Design?

Cili By Design is a multi-level marketing company (also known as direct sales or network marketing) which sells hemp sourced CBD oil and several other CBD infused, health-related products.

The company was founded in 2019 by Brad and Marcia Hager.  Brad Hager has extensive experience in sales and marketing and Marcia Hager has spent practically her entire professional life in network marketing (MLM).

Cili By Design is actually the business name of Social Wealth Ltd, a limited liability company registered in Northern Ireland in the United Kingdom and of which Marcia Hager is the sole director.

The US headquarters for the company is in Las Vegas, Nevada.

What is CBD Oil, Why is it so Popular and is it Legal?

CBD oil (cannabidiol) is one of many compounds found in cannabis plants.  Although there is little hard scientific evidence to back it up, many believe that CBD oil has huge health benefits and its proponents claim that it can cure, or at least help alleviate, a wide range of conditions and diseases, including stress, high blood pressure, chronic pain, cardiovascular disease, and even cancer.  As a result of all the hype, CBD oil’s popularity has sky-rocketed over the past few years and there has been no shortage of suppliers stepping in to meet the seemingly ever-growing demand.

Cannabis is, of course, illegal in many countries around the world but in the US, and following the passing of the Farm Act in 2018, the growing and sale of one type of cannabis plant, namely hemp, is now legal, provided it contains less than 0.3% THP (tetrahydrocannabinol) another compound found in cannabis plants and the one that causes the ‘high’.

So, CBD oil extracted from hemp plants can now be sold legally in the US, at least so far as the US Federal Government is concerned.  Unfortunately, the situation is not so clear at the state level, where there is very little consistency in the way individual states view cannabis generally and hemp sourced CBD oil in particular.  This means that anyone considering selling CBD oil in the US needs to carefully check what rules and regulations apply for each state where they plan to market their products.

The Basics

Name	Cili by Design
Website	cilibydesign.com
Owner	Brad and Marcia Hager
Price	$39.95 annually. You will also need to generate 65 Personal BV (business volume) to actually activate your membership and the only realistic way to achieve this is to purchase products.
What you get	Replicated website Wholesale product pricing Business and product training with ongoing support
Guarantee	None
CRIO rating (0-10)	3.5

Who is Cili by Design For?

Cili By Design is for anyone looking to start their own business and cash in on the booming CBD oil market while avoiding the high start-up costs usually involved in setting up a regular retail business.

Some experience in marketing, or at least sales, will be an advantage though not essential.

What you will need is preparedness to sell and sell hard.  Your first customers will be your family and friends and you need to be comfortable with that.  This is not peculiar to Cili By Design, it is a cornerstone principle of multi-level marketing.

There are no educational or experience requirements to join Cili.  Just pay the membership fee, buy some of their products and you are in.

Cili by Design Products and Pricing

Cili has a very small range of just six products at the current time but the company has only been in business for a little over a year (at the time of writing) and so we can likely expect more offerings in the future.

Cili claims that its CBD oil is the highest quality currently available anywhere although they offer no explanation or supporting evidence to back that claim up.  It also claims that its use of nanotechnology results in the oil being absorbed faster and more efficiently by the body.

Cili’s flagship product is Cili Swish which retails for $72.50 and the 6-ounce bottle is stated to contain 36 servings, which means the cost per serving is just over $2.00. The question is, how much CBD is in each serving?

The label information also says that each serving contains 3326 mg of “Proprietary Aqueceutical Blend” and the contents of that blend are then described as “EU Organic Whole Plant THC-Free Hemp Oil” but nowhere are we told how much CBD is in that hemp oil.

Without that information, it is impossible to make a comparison between Cili Swish and other similar products offered by Cili’s competitors.

The other five items in the Cili By Design product line are claimed to target a variety of health-related conditions.  Cili Boost is for extra energy, Cili Sleep for better sleeping, Cili Serenity for stress, Cili Relief for pain, and Cili Trim for weight loss.  All contain CBD oil (no indication of quantity) together with a variety of herbs and other ingredients.  They are all priced at $25.00 retail.

The Cili by Design Compensation Plan

As is common with MLM companies, the Cili Compensation Plan is at the same time complex yet scant on the detail you would need in order to get a real handle on the payment structure. Much of the terminology used is vague and often circular in nature. Make sure you have aspirin (or equivalent) handy if you commit to trying to understand it because it is headache-inducing. If you feel up to the challenge, you can read the entire Cili Compensation Plan here.

Cili claims that there are no less than 10 ways to make money with them and I will briefly look at each in turn.

Retail Commissions

These are commissions on regular retail sales, through a member’s replicated website, to the general public, i.e. not members of Cili. The commissions are calculated on the wholesale price of the product(s) and the selling member must otherwise be qualified to receive commissions.

A member earns a commission not only on his own sales but also potentially, and subject to his rank (rank is discussed below), on sales made by any member he has personally recruited to his downline plus sales by members recruited by that member, etc, all the way down to the 3rd level below him.

Per this table, a member who has achieved the rank of C1 will receive a commission (25%) on his own personal sales and 10% on sales by all members personally recruited by him (1st Level). Once he has achieved the rank of C3 he will receive 25% on his own sales, 10% on sales by his personal recruits (1st Level), 5% on sales by their recruits (2nd Level), and 5% on sales by their recruits (3rd Level).

Retail Fast Start Bonus

This is a one-time bonus paid to any member who, as the name suggests, is able to get off to a really fast start in product sales after first joining Cili and manages, within his first four weeks of membership, to sign up at least 10 VIP Customers, i.e customers who join Cili’s Easy Order program and agree to accept automatic shipments of products each month. There are, of course further, quite stringent conditions which need to be met (such as minimum product orders) but, if they are, the member receives a ‘bonus’ of $300.00 which is paid half in products and half in cash.

Personal Sales Bonus

Every Qualified Member receives a commission on every product purchase made by members who they personally sponsor, i.e. have recruited. A “Qualified Member” is a member who has achieved a Personal Sales Volume (PSV) of 65 during the previous month and “personal sales volume” is calculated based on the purchases made by the member himself and the member’s personal customers.

The amount of commission is again based on the members rank and starts at 10% for Qualified Members and rises to 25% for Qualified C3 members and above.

Business Builder Fast Start

This is another one-time bonus that a new member can earn during his first four weeks of membership. To qualify, the member has to do a lot of selling and recruiting including signing up at least four VIP Customers and personally sponsoring at least four new members all of whom have to purchase products. The member also has to achieve a 200 PSV. If he meets all these requirements the member gets a bonus of $400.00, half of which is paid in products and the other half in cash.

Team Commissions

Earnings in this category are the heart of the multi-level marketing model and this is where members have the best chance of making money. This is because here they have the opportunity to earn commissions on the sales made by all the members who comprise their sales team. A member’s sales team includes members they have personally recruited (1st Level), members recruited by those 1st Level members (2nd Level), members recruited by those 2nd Level members (3rd Level), and so on.

In calculating a member’s actual entitlement Cili has adopted what is known as the Binary model. Under this plan, the first two members recruited by a member (A) are placed in one of two ‘Legs’, either the left leg or the right leg, and become the 1st Level below A. Thereafter any further members recruited by A, as well as members recruited by A’s recruits, and in turn, those recruits own recruits, etc, get placed in succeeding levels, 2 through (theoretically) infinity of one of the two legs.

Each week Cili checks the product sales for every member in both legs of A’s team and then calculates the total Business Volume (BV) for each team based on those sales. The BV generated by every product sale is that portion of the wholesale price of the product that Cili has previously determined is to be made available for payment of bonuses and commissions. The Compensation Plan does not indicate the precise sum but it will be a specified amount for each Cili product and something less than the wholesale price for that product.

The team that has earned the lesser total BV (the Lesser Team) is then used to calculate A’s commission entitlement and A will receive a percentage of that lesser team’s total BV. The actual percentage is based on A’s rank in the organization:

To be entitled to receive any team commissions at all the member must have achieved at least the rank of C2, at which level he will receive 10% of the total BV. The percentage increases steadily as the member progresses through the ranks up to a maximum of 20% for C12.

Of course, and as with any MLM company, it’s not quite as simple as that and, in particular, there are numerous other conditions and qualifications that a member has to meet in order to ‘qualify’ for team commissions including meeting minimum sales and recruiting requirements.

Mentor Bonus

This bonus is designed to motivate members to actively encourage and support those members who they have personally sponsored (recruited) to perform better, i.e. sell more products and recruit more members.

Again, the bonus is a percentage determined by the member’s rank but this time the percentage is not of the BV but of the actual commissions earned by the sponsored members:

To qualify, the member must have achieved the minimum rank of C3 at which point he is entitled to 5% of his sponsored members commissions. The rate increases with the members rank all the way up to 50% for the rank of C12.

Car and Transportation Bonus

Despite the title, this is simply a monthly cash bonus that a member can earn once he has achieved the rank of C4 or higher.

To qualify a member has to achieve the rank during one monthly accounting period (the Rank Qualifying Period or RQP) and then maintain that rank through the end of the next RQP.

There are some complex provisions to cover the member dropping in rank and also rising through more than one rank in a RQP but otherwise the payments start at $100.00 for the rank of C4 and rise to $1,200.00 for the rank of C12.

Travel and Expense Account

Again, and despite the title, this is a cash bonus paid monthly to members who attain one of the higher ranks, and in this case, it starts at C5.

As with the Car and Transportation Bonus, the member achieves the new rank in one RQP and then has to maintain it throughout the following RQP.

There are again some complex provisions to cover the member dropping in rank and also rising through more than one rank in a RQP but otherwise the payments start at $250.00 for the rank of C5 and rise to $10,000.00 for the rank of C12.

Healthcare and Insurance Bonus

This is yet another monthly cash bonus that has no actual relation to Healthcare and Insurance, although the member could elect, if he so wishes, to apply the payment in that area.

Exactly the same provisions and qualifications apply here as for the preceding two bonuses with the payments starting at $350.00 for the rank of C6. There is currently a conflict on the Cili website as to the maximum monthly amount payable for the rank of C12 with one website page stating it to be $1,000.00 and another $1,200.00. This conflict is really of largely academic interest only because very few members are likely to ever achieve this rank.

Rank Bonuses

This is the fourth and last cash bonus that can be earned based on the members rank. The difference here though is that, unlike the preceding three rank-based bonuses, this one is a one time payment made to the member each time he achieves a new (higher) rank.

Also, the member has to maintain his new rank for three consecutive RQPs, not just one.

The payments start at $1,000.00 for achieving C5 rank and increase progressively to $250,000.00 for C12.

There is a cap of $25,000.00 on the monthly payment a member can receive. This means that up to the rank of C9 the member will receive his full entitlement in a single payment but those achieving C10 – C12 will get their payment in consecutive monthly installments of $25,000.00.

Cili Member Ranking

Some kind of member ranking system is an integral part of virtually every MLM Compensation Plan and Cili is no different. A member’s rank determines first his eligibility to even participate in the various income streams offered by the MLM company and second his actual share in those income streams. No less than four of the bonuses described above are based solely on the member’s rank.

Cili offers no less than 13 rank levels, starting with ‘Qualified Member’ and then progressing to C1 through C12. As can be seen above, the rank of Qualified Member only allows that member to earn commissions on his own personal sales and, to a limited extent, purchases by members he has personally recruited.

In order to earn commissions on sales by members of his own sales team, a member has to achieve the minimum rank of C2 and the right to earn the additional cash bonuses, such as Mentor Bonus, Car and Transportation Bonus, etc. only comes with the rank of C3 and above. The higher his rank the more a member can potentially earn, so rank is very important.

Each rank is earned by achieving the sales and recruiting goals set for it by Cili. At the lowest level of Qualified Member, those goals are relatively modest and only involve a sale (or personal purchase) or two by the member himself each month. On the other hand, achieving the rank of C12 is a tad more difficult and includes, amongst other things, achieving a BV of 2,500,000 in the member’s “personal sponsor tree” and that’s a lot of sales each month.

Having achieved any given rank a member has to continue meeting the relevant sales and recruiting goals every month, failing which he will drop in rank to the level appropriate to his actual sales and recruiting level for that month.

Income Disclosure

For any MLM company, I would ordinarily look for an Income Disclosure which is a statement by the company of the incomes earned by its members in the previous year of business. There is no legal obligation on any company to produce such a statement and many MLMs elect not to do so because the figures are usually so bad they are concerned they will frighten off potential new members. Naturally, the absence of such a statement is not an encouraging sign for anyone contemplating membership.

I have not been able to find an Income Statement for Cili By Design but remember the company only came into being in 2019 and any figures published for its first partial year of business would be meaningless anyway. We should not, therefore, read anything into the absence of such a statement in this case.

Is Multi-Level Marketing Bad (for you)?

While there are a number of different ways that multi-level marketing companies can be structured, they all have two things in common.  They have a product or service for sale and an extensive network of salespeople selling that product or service and recruiting more members.

The basic premise is simple.  The company first develops or otherwise acquires a product or service.  It then recruits a few members who are tasked with selling the product or service and recruiting more members who then form part of the recruiting member’s sales team (their downline).  Those newer members do the same thing and the resultant structure looks something like this:

In this illustration, the red guy is the MLM Company and, as you can see, having only recruited two members itself the company already has 14 members selling its products and recruiting yet more members.  In no time at all the company will have thousands of members all doing the same thing.

From the member’s perspective, it all sounds great at the beginning.  After all, they will be earning commissions on the products they sell themselves, plus commissions on the sales by their sales team (downline).  So what could possibly go wrong?  Well, plenty;

• Most of the products sold by MLM companies are not unique or particularly special in any way which means there is typically lots of competition, making sales difficult without incurring huge marketing costs.
• Each time a product is sold the member who sold it (the selling member) will typically get the largest commission on that sale.  But the member who recruited the selling member will also get a commission, as will the member who recruited him and so on up the member’s upline.  This means a lot of commissions are typically payable as a result of every sale.  The only way the MLM company can afford to do this is by inflating the price of the product dramatically.  This, of course, only makes the product even more difficult to sell in what is already a fiercely competitive market.
• Most MLM companies either require their members to make monthly personal product purchases or at least pressure them to do so.  Theoretically, the members can always try to resell those products, at over-inflated prices in a highly competitive market, or they can use them themselves, or they can store them.  Statistics show that the latter two options are by far the most frequently adopted.
• The competition aspect is made yet worse by the fact a customer has to wait for the product to be shipped to them, rather than just walking out of a retail store with it.  This problem is exacerbated if there is any delay in the product being shipped yet one of the most common complaints by customers of MLM companies is a delay in shipping.  If this happens, a once hard-won customer is unlikely to make a repeat order.
• In a perfect world, a member’s downline will just keep getting bigger and bigger and the member will earn more and more commissions.  At least that was the sales pitch when they signed up.  But in the real world of multi-level marketing, the attrition rate is horrendous.  A report by the Consumer Affairs Institute states; “At the very least, you can assume that 90% of participants will terminate within five years, and at least 95% within ten years”.  This means a member will be spending far more time recruiting replacement members than new members.

As a result of having a huge unpaid salesforce selling products for them, multi-level marketing companies make millions, if not billions, of dollars every year in product sales.  In turn, they do pay out a lot of money in sales commissions but they can afford to do that, and still make huge profits, because their only major expense is actually producing or purchasing the products being sold.  Because all the marketing is effectively done by their members, they don’t have huge marketing expenses, and because their members are all independent contractors they have minimal payroll expenses.  Everything is done online so they also don’t have the expense of maintaining retail premises.  It’s a license to print money….for the MLM company.

And so, what happens to those admittedly large sales commissions that get paid out?  By volume, most of the product sales in multi-level marketing are made by members in the lower levels of the network.  For the reasons previously mentioned they won’t make many sales individually (and most will likely be to themselves) but, because of the sheer numbers involved, the aggregate sales are massive.  But low individual sales numbers mean those members in the lower levels will be making very little in total commissions.  However, those members higher up in the upline will be making money.  It may not be a huge amount per individual sale but if their downline is making hundreds or even thousands of sales in aggregate then those commissions start to add up and the higher up a member is, the more they will make.  The problem is it’s only a select few who manage to reach that exalted status. In fact, the Consumer Affairs Institute Report found that an incredible 99% of MLM members actually lost money.

Cili by Design Complaints

I have not come across any complaints either regarding the products or the business opportunity.  This is perhaps not surprising considering Cili has only been operating for a little over twelve months.

Cili by Design Pros and Cons

Pros

• Seemingly high-quality products (no complaints found)
• Competitively priced products (compared to other MLM CBD companies)
• Owners have a solid background in marketing and appear to have a good reputation
• Though by no means perfect, or even fully understandable, the compensation plan is better written than most

Cons

• Products are still expensive when compared to similar products from non-MLM companies
• The actual CBD content of their products is either unclear or not stated
• Despite being better written than most, the Compensation Plan is still confusing and difficult to understand
• To have any chance of success a new member will have to commit to substantial personal product purchases and ruthlessly recruiting more and more new members
• The MLM business model is inherently flawed and designed to enrich only the owners and a few super-performers near the top of the chain
• MLM Statistics show that 99% of members will either make no money or lose money

So, Does Cili by Design Offer a Real Income Opportunity or is it a Scam?

First, let me say Cili By Design is not a scam. There are real, high-quality products and the Compensation Plan does present an opportunity for members to make money and a few people will indeed likely make a substantial amount of money. However, the emphasis here is on “a few”.

The Cili products are still expensive when compared to similar products being sold by non-MLM companies and so members will have a problem selling them to the general public. As a result, members will end up purchasing most of the products themselves and/or pressuring their own recruits into purchasing them. They will do this in what will be (for most of them) a futile attempt to maintain their commission-earning status and rank.

If you are prepared (and financially able) to make substantial personal product purchases, at least at the beginning, and to aggressively recruit family and friends (and anyone else you know) into your sales team then you have a chance to become one of the few who will make money with Cili by Design. However, the odds are definitely stacked against you and it is far more likely that you will be one of the vast majority of members (99%) who either makes no money or loses money.

Another Way to Make Money Selling CBD

One of the often-touted benefits of selling through an MLM scheme is that you avoid the hassle and expense of maintaining your own inventory of products, as you would in a more conventional retail model, and this is true to a point. However, and for the reasons I mention above, with any MLM scheme you will still inevitably need to purchase large quantities of products in order to maintain your rank and remain qualified to earn commissions. But there is another way of selling CBD products where you absolutely do not need to carry any stock at all and that is through affiliate marketing.

As an affiliate marketer:

• You carry no stock at all
• You can sell a wide variety of products from multiple manufacturers
• You spend the vast majority of your time actually selling, not recruiting
• You are your own boss and set your own hours
• Your operating costs are minimal
• You are working from home and your home can be anywhere
• You will not become a pariah to your family and friends

Final Thoughts

Are you now, or have you been, a member of Cili by Design? If so please share your experience with our readers by leaving a comment in the box below.

I have tried to make this review as comprehensive as possible but if anything is unclear or you have a question then, likewise, please post it in the box below and I will respond as quickly as possible.

I thank you for taking the the time to read my review of Cili By Design and, whatever path you decide to take, I wish you every success in your endeavors to create a sustainable income.

Best wishes,

Philip