This article is why I don't promote MLMs, Network Marketing or any other name for this type of work from home JOB. Under no circumstances are you a business owner, you are an independent contractor under a tiered work plan. There are people who are "successful" in the MLM world (success is a relative term), but the majority of people simply spend money they don't have on the promise of earning it back and MORE. The truth is the COMPANY makes its money on its SALES FORCE, not on it's customers.
Take a moment to let that sink in, you can't sell a product you don't have or haven't used. So the Sales Force is constantly purchasing new items to have on hand for display and to have a personal story to tell. Sure these companies often have "incentives" to earn the new product kits (at varying levels), but often this leads to the sales force bugging friends, family and past purchasers to "help them get to the next level." Or worse yet (as I did several times) purchasing products themselves to make the level.
I HAVE SOLD FOR MANY MLMS not ONE of them made me money.
I started with Pampered Chef. At that time, the company released new products every 6 months and the changes were minimal. You could count on your upline to purchase the new product package and demo them at the monthly sales meeting. This way you could have a personal story for them. Then the company changed hands and new products were being release monthly, and NOT products I would ever use (mostly serving items - plates, platters, bowls, etc.)
I justified it as a way to be home with my then 18 month old daughter and have some money to spend. I have a small circle of friends (all of whom were broke college kids out of town at school) and I have my parents. My Mom was super supportive, but it got to a point where she didn't want new products either.
I moved on to Creative Memories, because I loved Scrapbooking. I however, hated the company's party model. Asking people to bring 3-4 photos to the party and they would leave with 1 completed scrapbook page. The problem? The consultant decided on the page size 8x8 or 12x12 and the pages were not compatible with any other scrapbooks, so unless you invested (heavily in pages, covers and supplies) you had these useless pages that forever changed your photos. I tried to change the model and simply allow people to scrapbook MY photos (I always had doubles made, so I wouldn't care if they messed something up), but their style wasn't my style so I had these pages that simply weren't cohesive. I tried running JUST workshops, but I didn't have the money or connections to rent locations. I STILL 10+ years later have more than $3000 in stock that I won't use and have been slowly selling on Craigslist and Garage Sales for PENNIES on the DOLLAR.
I tried Tupperware, even Mary Kay (and I don't wear makeup or use a skin care line) and Lemongrass Spa.
With every company I was promised that if I just spent some money on my credit card I would make it back in under a month (time enough to pay off my credit card without paying interest) and MORE. I would object that I simply didn't KNOW enough people and the person recruiting me promised to help me get started. Each time, I did not earn enough back to pay for the investment, and was still in the red when the new products were released. And foolishly I spent even MORE to try to earn more. It was the "You've got to spend money to make money" adage that ran through my head every single time.
Some of the women who recruited me were genuinely doing well and thought I would do well (Creative Memories and DoTerra), but the rest simply wanted the credits of my starter kit and whatever sales I could eek out before I couldn't afford to do it anymore. (Yes, I absolutely have culpability. I am an able minded adult and chose to believe time and again that THIS was the magic pill that would cure what ailed me.)
Are the companies pyramid schemes? No. Scheme implies no actual product, a sham, where money flows UP the pyramid but not down. They are absolutely pyramid structures, but in all reality so is EVERY SINGLE CORPORATION.
Are there people who are successful with MLMs? Absolutely. Typically these are individuals who found a company at it's launch, joined early and had the financial means to SPEND MONEY TO MAKE MONEY. However, the overwhelming truth is that MOST people who join MLMs lose money and friends.
I was a LONELY stay at home mom. My friends were all away at college and living the college life. I was a Mom. I didn't always have access to a vehicle during the day, so getting out to things with my baby was difficult. I didn't know about any online Mom groups, in person places to meet other moms, and it seemed all of my local friends abandoned me when I had my daughter. This was compounded when a friend had her baby and those same local friends always called to check on her, and invite her out. I felt abandoned by my friends, and a burden to my working spouse. I was promised spending money, and some time with adults.
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