4 Key excerpts on "Multi level Marketing"

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  eBook - ePub

  Wealth Without Stocks or Mutual Funds

  The Ultimate Blueprint of Little-Known, Powerful Strategies for Building Diversified Wealth and Income

  • John Jamieson(Author)
  • 2015(Publication Date)
  • JC Press

    (Publisher)

  Chapter 16 Network Marketing in the 21st Century

  What runs through your mind when you hear the terms “network marketing, direct sales, and multilevel marketing,” or MLM for short? Many people have a very negative outlook on these kinds of structures and refer to them as a “scheme,” a “pyramid scheme,” or even a “Ponzi Scheme.”

  They have visions of buying all kinds of products up front and then pestering their friends and family members to buy overpriced products of dubious quality. There is a reason many people believe these statements are true. The fact is that for many years these thoughts and statements were true of many companies and opportunities. The business model would usually look something like this:

  1)You sign up to be a distributor of a product (let’s say vitamins and health products for this example). 2)You buy a starter kit and an initial product package because after all you have to be a product of the product. 3)You commit to buy a minimum amount of product every month so you can be qualified to earn down line commissions. 4)You buy more products up front so you can have it on hand to sell to customers because you have been told the product will go flying off of your shelf. 5)You call on friends and family members only to receive the cold shoulder or grudging appointments to show them your new venture. 6)Your mom and sister might sign up to buy some products and to become distributors but few others become members of your down line or even customers. 7)You receive more products every month for several months and then become frustrated and quit the business and usually stop receiving the products. 8)Your down line (mom and sister) quickly follow suit and your venture went from up and running to closed within weeks or a few months.

  This unfortunately was all too common with many network marketing companies. Thankfully, many companies have changed much of that business model and modern technology has transformed the basic structure of many operations. The industry itself did very little to rein in overzealous distributors who promised untold riches with very little work for new recruits. Since that time, companies have changed their ways and government regulation has helped a more realistic picture to be painted for new prospects.

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  eBook - ePub

  The New Wellness Revolution

  How to Make a Fortune in the Next Trillion Dollar Industry

  • Paul Zane Pilzer(Author)
  • 2012(Publication Date)
  • Wiley

    (Publisher)

  CHAPTER 9

  Direct Selling—How to Get Started

  There are many ways to create fortunes in the wellness revolution. One of my favorites, particularly for new entrepreneurs starting out, is Direct Selling, also called Network Marketing and sometimes referred to as Multilevel Marketing (MLM), based on its compensation formula.

  Direct selling is very different today than it was in the past. Today:

  • Quality direct selling companies and their distributors only make money when they either sell product or when the new distributors they sign up make money from actual product sales—not by convincing people to sign up for a business opportunity.
  • Most quality direct selling companies today are members of the DSA (Direct Selling Association), an organization that holds member companies accountable to a very strict code of conduct that includes things like returns of unused merchandise and no false representations of potential earnings.

  What I like most about direct selling is:

  • Anyone can choose to become successful without having to get through the traditional hiring process or risk a large cash investment, and
  • The personal growth and training provided by most direct selling opportunities.

  In the 33 years since I graduated college, I’ve been a government official in the White House, a vice president with Citicorp, the founder and CEO of several companies, and a professor at New York University. Looking back today on all of these experiences, the place where I have seen the greatest positive impact made on the largest number of individuals has been in the direct selling industry.

  Personally, I’ve never been directly involved with a direct sales company, or endorsed any individual company’s product or business opportunity. Although I am sometimes referred to as an expert on the direct selling industry, I didn’t even know what direct selling, multilevel marketing (MLM), or network marketing was when I was first invited to speak at an Amway convention in March 1991.

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  Start Your Dream Business Today

  Businesses You Can Start With No Money or Education

  • James G. Palumbo(Author)
  • 2022(Publication Date)
  • G&D Media

    (Publisher)

  My biggest concern here is the opportunity cost. I’ve watched friends and acquaintances invest years of sincere effort into MLM businesses and find little success. The same passion, dedication, and time investment would yield huge results in a hundred other startups or ventures.

  Multilevel Marketing

  Did I mention that I mistrust MLM? I do, but for some this might be a good side gig. If you find this type of opportunities attractive, remember to base your income and success projections on the product you can sell, not on the downline you can build (unless, again, you are at the first or second level in a new company). If it is a mature business, your ability to build a downline of other associates is limited by the current market saturation. Everyone has already heard the pitch. The end result for many is simply that you, your family, and friends become consumers of the products rather than viable recruiters or resellers. Be careful. Enter at your own risk.

  Here are a few of the most popular MLM companies. I’m including the year they were founded and the resale volume in dollars, so you can consider the market saturation of these opportunities: Amway, 1959, $8.8 billion; Avon, 1886, $5.7 billion; Herbalife, 1980, $4.5 billion; Natura, 1969, $4.4 billion; Mary Kay, 1963, $3.5 billion; Nu Skin, 1984, $2.2 billion; Tupperware, 1948, $2.26 billion; Melaleuca, 1985, $2 billion; Primerica, 1977, $1.6 billion; Young Living, 1993, $1.5 billion; Ambit Energy, 2006, $1.1 billion; Shaklee, 1956, $84 million.

  Partial List of Direct Sales Companies

  I haven’t vetted this list, nor am I endorsing any of the companies. It includes MLM businesses. You will need to evaluate each opportunity and perform your due diligence to determine if it is a good opportunity for you.

  • 4Life Research, LLC. Nutritional products and supplements
  • Abby + Anna. Leggings, tunics, and dresses for women and young girls
  • AdvoCare International. Nutritional and skin care products
  • Agnes & Dora. Comfy leggings, tunics, and dresses that are made in the USA.
  • Aihu. Healing skin care and body products

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  Multi Level Marketing

  • Margareth Moonlight(Author)
  • 2021(Publication Date)
  • Bibliomundi

    (Publisher)

  A real business is built around a real product or service. “Making money” is not generally a valid product within an MLM structure, and a plan that sells only an opportunity with no real product is almost always considered an illegal pyramid scam.

  I recommend you avoid at all cost any program without a real product. This sort of structure is going to collapse at some point because it is entirely based on finding new investors to pay the upline structure, and when new people stop joining the whole model falls apart.

  A tell-take sign of this sort of scam is any program that asks you to make multiple payments to participate. For example after you sign up you will be instructed to send a payment to your sponsor, another payment to his/her sponsor, and another payment to the company; this is NOT a reasonable and ethical business model and you should avoid participating in a structure of this nature.

   

  Products That Nobody Wants

  Be sure a prospective opportunity is built around a great product that people actually want to buy. This is the hallmark of a good network marketing company.

  Many MLM companies have fabulous product lines that retail consumers are happy to shell out good money for. But other companies are peddling junk that nobody would buy if there weren’t a business opportunity involved.

  Look at the product and ask yourself: “If not for the chance to make money as a distributor, would I even think about buying this?” If you answer “NO” to this question walk away from the MLM in question immediately. If you answer “YES” it’s worthwhile to keep investigating the opportunity.

  I personally like to see most of the company’s retail volume coming from people who are not registered distributors. This is called “outside sales” and it’s a good indicator of the real market value of the product being promoted.

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