
MLM is a case where it is far too easy to throw away the baby with the bath water...especially if you believe you've been burned.
It is easy and understandable why MLM – despite growing scrutiny and regulation – remains a scandal, in most cases. Overpriced products being bought and flogged to others is not a legitimate business model, though it is alluring (maybe hypnotic) to lazy, something-for-nothing thinkers.
After all, we are taught that MLM is nothing more than the same action as when we share a good movie with a friend and that friend with his friend to infinity. Eventually, we will all see the movie, right? And why not get a piece of the action for the simple and natural act of sharing a good thing, right?
Now some people are bad sorts and they may diss the “opportunity,” thus we better recruit, recruit, recruit until we get that big hitter just waiting to be discovered who will then, logically, through his huge downline of happy worker-ants make a fortune for himself and us, the upline, and ultimately we can all sip daiquiris in a Caribbean concubine and live off the residuals until the sun don’t shine.
The truly affluent buy what they want directly. They don’t need clubs or discount membership organizations as a buffer zone or to save a few quid. They purchase quality or conspicuously consume by need or want alone, regardless of the price sticker. They are not MLMers or are ex-MLMers who have sapped out the opportunity seekers’ pocketbooks and got out while the getting out was good.
MLM is, in reality, a business that just keeps reselling the opportunity to sign up more distributors. Nobody in their right mind would buy a seriously overpriced product line on a regular basis unless it meant that they could in turn sucker other people into the losing cause. One can get pretty winded, however, doing that for a lengthy time, and must also feel a gnawing pang of guilt that they are passing a lie from one human being to the next based on what they have been told is possible rather than what they have experienced personally.
I have read in multiple sources that even in the biggest and oldest MLMs, less than one percent of the distributors ever make more than $50 gross per month. That is gross! And in the process you may lose the trust and respect of friends, colleagues and family.
Ah, but the modern online versions of MLM – using the cover of affiliate programs – tell you that you needn’t go after that warm market anymore – that the world is at your beck and call and ready to buy your aloe gel, healthy chocolate, travel excursions or green computers. The market, they claim, is infinite and you are at the ground-floor level of a debt-free, can’t-miss company that’s exploding like a porno star.
UR UR UR URRR!…the roosters are crowing. Wake up. How insane is it to chase these rabbits. They come and go, and leave a lot of death and destruction in their wake. I can’t recall how many times an addicted MLMer will approach me with Project X MLM one month, Project Y a few months later, and still another scheme a half-dozen months hence.
I can’t tell you how many times distributors are forced to front-load their wares, despite legal regulations against such practice.
I can’t tell you how often I have heard personally or read in forums online about distributors who were stacked with downline because the system rewards the deeper levels exponentially more than the first downline level. I can’t bear to tell you how many distributors initially made some chicken-feed profits with the winking upline’s assistance, invested more in the “can’t lose” MLM, and then watch their company close down with their commissions unpaid /their inventory unsold.
So here’s a funny question: Am I totally against MLMs and the concept behind them? No, the industry is evolving and a few companies are leading the way in transparency and in offering really useful products and services at non-extortionist prices.
Some of the key factors that I use in determining the transparency of MLMs are
1) Is the product comparable or better in price and quality with those available in normal retail channels?
2) Are the leaders accessible?
3) Is the product or service consumable and does it require continued use?
4) Is it necessary to jump through many convoluted hoops in order to get money for the retailing of the product or service?
5) Does the company lead with hype or with training? (The latter is what I’m searching for.)
6) Other than the top echelon of the company, do many of the user/distributors have effusive praise for the founders and are hundreds rather than a few of them long-term fans of the founder, his company and his philosophy?
7) How many members/users have made and are continuing to make more than $50 a month? (If it is more than five percent, it’s a winner!)
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