Your Take on Multi-Level Marketing

[Madwand]

Most MLM are not scams.

A scam is a fraudulent scheme designed to make a quick profit. Legit MLM's are required to disclose what percentage of their members are making the dollars. They must also disclose that there are no guarantees to the amount of money you will make.

What I don't like about many in the business is they get people to join based on pure emotion and with lack of a marketing plan. The people sign up and then within a few months have made zero dollars but have spent hundreds or thousands just to get in.

The strategies taught by the elite are not what the elite actually do. The elite believe that their marketing strategies can not be duplicated by the inferior downline so they teach them to call all their friends and family and buy leads etc. The end result is the the elite marketing experts get richer and the others make little or no money. The purpose of the downline is to feed the Super Marketers.

What they should be doing is teach people how to market.

Scott Marvin

[cschin4]

The people sign up and then within a few months have made zero dollars but have spent hundreds or thousands just to get in.

That sounds like a scam to me.

[tark]

I do MLM, there definately are some scams out there...but if you find the right site and work at it, you will get money!

[sliderhouserules]

Anyone interested in MLM or that doesn't have an opinion about MLM should go read up on Pyramid Schemes and Ponzi Schemes. MLM's are only not illegal because they partner these illegal schemes with some real selling. But that doesn't change the fact that the whole pyramid/ponzi side of it is what it is.

First post, just couldn't resist chiming in on this one!

[gackle]

The people sign up and then within a few months have made zero dollars but have spent hundreds or thousands just to get in.

That sounds like a scam to me.

MLMs are like any other business model. Most businesses require an initial capital investment. It's up to the individual to make sure that one is entering a business that will thrive upon that individual's strengths. If you're not selling something you're passionate about then you're not going to make any money because you're lack of passion for the product shows through to the prospective buyers.

[irmanator]

MLMs are like any other business model. Most businesses require an initial capital investment. It's up to the individual to make sure that one is entering a business that will thrive upon that individual's strengths. If you're not selling something you're passionate about then you're not going to make any money because you're lack of passion for the product shows through to the prospective buyers.

this is why i couldn't do mary kay with my friends I havent worn makeup since my wedding (that was from the little mary kay samples lol)

[cschin4]

MLMs are like any other business model.

How so? Legitimate businesses are interested in selling a product. The MLM focus is on recruitment of other "sales consultants" rather than the actual product. When you go to buy a car, does the car salesman try to sell you a car or spend most of his time telling you why you should also become a car salesman as well? Seems to me that if you have a good product, you would be about the business of selling it, not recruiting everybody and their brother into the "business".
So, I think that is the big "red flag" of the MLM's. Avon, tupperware, etc is actually trying to sell their product. Those who are selling vitamins and shakes are much more interested in signing you up to be a "distributor" than they are in actually selling you their products.

[disneysteve]

MLMs are like any other business model.

How so? Legitimate businesses are interested in selling a product. The MLM focus is on recruitment of other "sales consultants" rather than the actual product. When you go to buy a car, does the car salesman try to sell you a car or spend most of his time telling you why you should also become a car salesman as well? Seems to me that if you have a good product, you would be about the business of selling it, not recruiting everybody and their brother into the "business".
So, I think that is the big "red flag" of the MLM's. Avon, tupperware, etc is actually trying to sell their product. Those who are selling vitamins and shakes are much more interested in signing you up to be a "distributor" than they are in actually selling you their products.

I agree, though not so much about Tupperware. My wife sold Tupperware for a while. There was very much emphasis on getting others to host parties and sell the product. There was definitely a pyramid structure. Her team leader (or whatever they called it) depended on my wife and other women under her. The leader had a company car. In order to keep that car, she and her team had to maintain certain sales numbers, so she was constantly pushing folks to sell and recruit more people to the team.

[Johansen8]

Although it is possible to build a successful multilevel business with comparatively little start-up money, keep in mind that it is not a means of getting rich quickly or easily.

[gackle]

MLMs are like any other business model.

How so? Legitimate businesses are interested in selling a product. The MLM focus is on recruitment of other "sales consultants" rather than the actual product.

And what do these other "sales consultants" do? They sell product.

I don't disagree that some people in MLMs can put unfair stress on friends and relatives to buy products, but that, IMHO, is a symptom of the type of person selling the product. There seems to be an attitude out there that MLMs will have people banking the money for minimal work and it's just not true. They are like any other business (generally speaking) in which the amount of effort one puts into their business is directly proportional the amount of return on their money they will get for their effort.

[cschin4]

And what do these other "sales consultants" do? They sell product.


My point is that the product is the sideshow. The real emphasis is on you to recruit other "sales consultants" rather then sell the product. Quite the reverse of traditional business where the product is the emphasis.
But, it certainly is NOT a get rich quick either way. You probably can make money on MLM but it is going to involve time and effort just like any job. I do think that those who get into it are looking for "easy money" when there is really no such thing. Some of the folks I know in it would probably be further ahead by just getting a part time job. It wouldn't take so much of their time and they wouldn't have to annoy their friends and families!

[gackle]

I agree that there are greater efforts to recruit salespeople than other business models, but I think that's just a nature of the way that MLMs are constructed. They have zero to minimal advertising and marketing costs, instead relying on their members to spread the word about the product. In the end, it's the sale of the product that keeps any business in business. The more salespeople MLMs have the more product they sell, the more successful they are.

[jIM_Ohio]

It's a scam in terms of the person making the most money on a given transaction is probably not the one doing the work for the transaction.

These are very popular in Michigan.
I once got suckered into one when in college
I had a friend selling amway when I worked at Ford after graduation
An old fraternity brother wanted me to join team national earlier this year.

They all had many things in common:
1) if I sold something, someone somewhere else in company was making a percentage off my transaction.

argument- if I were to go into business for myself, I would not have to pay the percentage being mentioned to anyone except myself.

2) I needed to put cash upfront for something
this cash went to someone which was higher up as "profit" at my "expense". This was generally advertised as training.

3) The lure of other people working and making money for self is enticing, but once the people under you lose the motivation, you lose your income.


Multi-generational means a parent can pass the "business" onto a child at death.

[Gruntina]

Some people are not good at being entrepreneurs or sole proprietors.

In some MLM like Pampered Chef for an example, people can do the marketing, PR, outstanding orders, and etc. without having to worry about making the products. Its like a collaboration. When you have some people reporting to you, you get a glimps if you would be a good manager or not.

Doing something like MLM short term can build up your resume, providing more advance skills for those who are just starting the workforce.

[Scanner]

I just think of my poor wife - she is a very busy woman and wouldn't mind some "genuine" friends and invitations to parties and she gets those stupid Candle Party Invitations or Pampered Chef or Sex Toys (a new one) invitation.

I'm her sex toy. Why would she need a party for that?

Unless she plans to use me in her downline. . .now maybe I can get on board with that.