Multi-level Marketing – Does it work? Pyramid Scheme?

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Is Multi-level Marketing for you?

Multi-level marketing companies are very alluring and offer the ability to multiply your income exponentially just by finding others that are willing to fall into the same trap you fell into. Ok, that is a little unfair, but the truth is that a lot of people invest their money and time only to realize that this type of business was not for them.

So let’s explore 3 commonly asked questions: 1 Can I get rich? 2. Is this for me?  3. Are MLM Scams?

Can I get rich quick?

First of all, getting rich usually takes one or a few of the following: Time, Expertise, Hard Work, a Unique Idea/Product, Access to Capital, Relationship(s).

The fact is that 99% MLMs fail. But, lets compare that to other businesses. The Small Business Association (SBA) found that 44% of small businesses survive at least four years, and 31 percent at least seven years. The NFIB (National Federation of Independent Business) found in a recent survey of small businesses that over the lifetime of a business, 39 percent are profitable, 30 percent break even, and 30 percent lose money.

Is this for me?

In most cases MLMs have a few things in common.

1. An initial cost/investment
2. A required purchase of the products your are selling
3. Weekly or Monthly Conference calls
4. Incentive to get others to do the same
5. A monthly minimum purchase of products/inventory

If the product is good, which they usually are, you are a great communicator, and have a large network then you might have a good chance of racking in a lot of dough.

However, keep in mind, the turnover rate for customers and salespeople under your organization is typically very high. So you will need to continue to expand your network to replace the customers and salespeople that leave the program.

Are MLM Scams?

Some MLMs are scams, but it does not hold true that all MLMs are scams nor pyramid schemes. If you’re still thinking of joining an MLM, then it’s crucial that you research and investigate the company and products thoroughly to make sure that it’s not a scam. You also must be sure that it’s a product and system you feel you can promote.

See some popular MLMs and Categories
Amway, Herbal Life, Avon and 1000s of others