Sunday, September 19, 2010
Multi Level Marketing practices
Multi Level Marketing also known as MLM is a trap a lot of people call into when looking for work from home. They hear about only needing to pay a membership fee which is maybe $30-$50 a month so its not that bad. The owners of the company are trying to lure you in by telling you that you can make up to $5,000 dollars a week and its very easy to do. A lot of them will even tell you that there is no selling involved. Now it is the law that these companies put on their website that you are not gaurenteed to make money (in fine print of course). A lot of MLM companies have gotten sued over false claims that they have made so now they need to put a disclaimer somewhere on the website. The problem is with that is it is in fine print usually someone else on the page where there are some people who just did not see it. Usually though in the fine print the company will say something like, 80% of the Independent Business Owners (IBO's) signed up with the company will not make anything or up to $20.00 in their first year. Now I am not quoting that it was just a guess from sites I have seen. It is somewhere around those numbers though. Now there are those MLM IBO's that do well and make a decent amount of cash. The problem is that is probably 1 in 1000 people (I may be low balling it) that have signed up with the company. Also these are the ones that are making a lot of their money from selling books, cd's, conferences, etc. A lot of the time the people who do these conferences and sell these items are the ones that are upper management with the company. It is an extremely rare thing to be successful at this and there have been a lot of people who have lost a lot of money not just with the monthly fee but with the items that these "Successful" people sell. They have been accused on news programs such as Dateline NBC about how they make most of their money by selling these success kits to IBO's that have just signed up. This company of course denied it but we know that its a lie. Now let me explain a little bit how MLM works. There is a company with products/services that they are offering. They ask people to sign up for a business opportunity selling these products/services. Then they also mention if you can sign people up to work for their company you will get money off of their transactions as well. Then the people they will sign up you will get a percentage of their sales as well. So its just a giant pyramid scheme. Of course the more people you sign up the more money you will make. In fact that is where a large amount of the money you can earn will come from, making money off of other people's sales. Of course you can make some money selling these products/services but if you want to see the real money you need to sign people up. This is a lot harder then it looks because most people out there know not to sign up for any "Pyramid Scheme". If you look hard enough you may be able to find someone interested but its just not worth it with the little pay off you will get. As I have stated before there is only a very small chance you will make it in this type of business. What it really comes down to is are you good at scamming people as well? That's what you need to do in order to be successful in this field. You will also lose a lot of friends so you must be prepared to handle that. Most people couldn't bring themselves to scam others. Now I know that I may get criticized for this post because some people claim to have made a lot of money and the company they are with is not a scam. You know you may be selling a good product or service, but when you are making claims that people will make all this money and then putting a disclaimer in fine print and hidden pretty well you ARE scamming other people!