Jumat, 18 Januari 2008

Top 5 ���Red Flags��� of Bad MLM Companies

by Ben Blackburn

In a previous blog, I discussed the difference between legitimate multi level marketing companies and “pyramid schemes.” Whether you like it or not, there is a difference. However, I would like to go in to more detail on that subject and discuss the “red flags” that indicate a business that is inevitably going to leave you high and dry with nothing to show for it but a butt load of products you will never use and a group of friends that doesn’t want to hang out with you anymore. Let’s face it: your friends are not going to want to talk to you after you recruit them into a business that fails.

Without and further ado, here are the top five ways you can tell if a company is really just a disguised pyramid scheme:

5. There is a large fee to “get your business started.” If they are making money by having you help them sell legitimate products, then they shouldn’t be asking for a bunch of money from you BEFORE you even start selling products. Their revenue is coming from the wrong place.

4. You are promised that you can make a lot of money without doing a lot of work. There are of course things that you can do to make money without having to work all that hard. For example, you could be a professional athlete. But, it’s just not possible for EVERYONE who joins a business to be able to make so much money without working. Making money takes work. End of story.

3. You are encouraged to make purchases to advance your status rather than making sales. Often times MLM companies want you to think that making purchases for products within the company is a form of “investment.” They would also have you think that making purchases will help you grow your business. If it were possible to make money by simply buying products and doing nothing else, don’t you think everybody would do that?

2. Income projections are particularly high. Many companies love emphasizing how much you will make, but rarely mention how you are going to make it. MLM opportunities have proven historically to be little better than a side income at best for most people. If you are told that you can expect to “fire your boss” by next month, they are probably just trying to get you hyped up about the business so you will fork over your money in hopes of future riches.

1. You make more money from recruiting than you do from selling products. If they would rather have you recruit another distributor than a new customer, then their products are not what is driving the company. Companies that are really successful are those that sell PRODUCTS, not so-called business opportunities. A company that is filled up with people but no products is still just a group of people, not a thriving company.

So there you have it. After years of investigating MLM companies, this is what I have come up with. There are of course many other things that I could have written about, but I chose to focus on these. I will go into detail on these things in later posts.

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The Truth about MLM, Network Marketing, and Pyramid Schemes

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