Multi Level Marketing Programs -Are They Pyramids in Disguise?
Sunday, December 21, 2008 21:25The words multi level marketing leave a bad taste in the mouth of many people. These kinds of business set ups are associated with scams to a lot of people. Is that a fair characterization? There are legitimate multi level marketing programs out there, and it is possible for people to make a lot of money in this kind of business structure. However, multi level marketing organizations got their reputation for a reason. Learning to separate the scams from the legitimate businesses opportunities is rule number one if you’re considering making a living using multi level marketing.
The real stigma associated witha href=http://spiderwebincome.ws/blogmulti level marketing schemes/acomes from the fact that many of them are just simply pyramid programs or ponzi schemes in disguise. Fortunately, there is one tell tale sign that gives away one of these types of multi level marketing program right off the bat. If the multi level marketing organization places a greater importance on recruiting new members than it does selling a product, then you know you have a scam on your hands. That is, if the company you are considering joining charges you a membership fee to sign up and then encourages you to go out and get your friends and family to pay the same, your are dealing with a pyramid scheme. The kind of incentive they offer you is usually financial. You’ll get a bonus for every person you get to join the multi level marketing program, and you’ll get a cut of the sales of every person you convince to join. Of course, these sales are just more membership fees, and so it goes on and on and on.
Some people may wonder, well, what’s wrong with that set up? If everyone is making money, who cares if there really is no product being offered? There are a few things wrong with that logic. First of all, pyramid schemes are illegal. If you knowing participate in one, you could be fined, and if you are a major player in the scheme, you could go to jail. Second, pyramid schemes pick on the weak (which is actually why they are illegal). No one is upfront about what a pyramid scheme is. They are presented in terms of the ultimate get rich quick opportunity, a surefire bet that will pay off in dividends. For this reason, the people who are attracted to them are often down on their luck, extremely naïve, or both. You might be able to make a profit from them, but you have to be comfortable with taking from the people who can least afford to give.
Does that mean alla href=http://spiderwebincome.ws/blogmulti level marketing/aschemes are pyramid scams? Definitely not, but you should always approach them with caution. If you can’t find a product to sell, or if the vast majority of your time will be devoted to recruiting new members, turn around and run. Not only is the program unlikely to pay out in the way the company promises, you may end up losing a good chunk of your own money in the process.
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