Dirty Little Untruths about MLM

By Sadie Morock

Have you heard of MLM? If not, that is very rare. Most people have been approached by someone in multilevel marketing at some point in their lives. You know what MLM is. Don't you? Multi Level Marketing is what MLM stands for. It is a particular business model that many people confuse with illegal pyramids schemes. What happens is each time you sell something, you get a commission, but so also does the person that hired you. You then hire someone else and earn from their work (and the person who hired you earns as well) and so on and so forth. It is important that you are careful, however, especially when promises of cash flow come your way. Here are some ugly truths about MLM that you should know.

You have a line of people working under you and those people have people working under them. Money is paid to your people and so on until everyone gets a piece of the pie. However, there is always a change in the program. This is why you should learn all of the little details before you get sucked in.

They want you to believe that MLM is not a pyramid scam because people are receiving physical products. However, MLM is set up just like one of these schemes. Just because you are promoting products and not mailing your money to another person, this does not remove the possibility for a scam. Because this was so hard to handle, the courts made a ruling. You cannot sell anymore than seventy percent to a non distributor. Anytime that the numbers are different, then it is a scam.

A common myth often perpetuated by those in MLM is that the products that they sell will soon be sold in retail stores after they have been sold through multilevel marketing. Sadly, the real truth is that the high-volume of product sold through most MLM companies is actually purchased by the people in the company trying to sell it to family and friends. It is incredibly rare that any sort of retail establishment will want to buy the product - even when an MLMer takes them in to sell on consignment.

A lie that is told to many new recruits in most any MLM business is that the products they are selling will soon be offered in retail stores, right after they have been sold to their downline. To make a profit, the only way that most MLM companies can make money is to convince people in their company to buy their products wholesale, and sell them to other people. What typically happens is the MLMer is unable to sell his merchandise and turns to retail outlets in an attempt to sell at wholesale or perhaps on consignment just to get rid of the stuff. MLM has been associated with being absolutely pointless as a business model for the majority of people for a very long time. Yet, the industry still manages to attract more newbies to give it a shot, and so it remains. Sadly, those people who do get sucked into MLM often lose a lot of money - and a lot of friends - before coming to the conclusion that all online business must be the same type of scam. Take note of this article and don't become one of those people.

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