How to spot a Multi-Level Marketing (MLM) plan

MLM

NAME: Multi-level marketing (MLM)

NATURE: Legal

SOLE PURPOSE: sale of real market value goods and services

PROFIT GENERATION: Commission plans on sales and recruitment (optional)

ENTRY: Dependent on the MLM Company

PRODUCTS/ SERVICES: Available and they possess

  • real market value
  • good quality
  • great value to customer

OPERATIONS:

  • A sales representative (distributor) sells goods and services directly to customers
  • The sales rep then recruits ONE person under him and trains him/her how to get customers
  • When the person recruited knows how to get customers, he is then trained on how to recruit others and therefore also becomes a distributor and the cycle continues

INTERACTION WITH PROMOTER: Indirect

COLLAPSE: Self sustaining

BENEFICIARIES: Active members who sell the goods and services

REFUND: Some offer buy-back guarantees at a certain percentage for any unsold products

Related Posts: How to spot a pyramid scheme ; How to spot a ponzi scheme

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