Beware! Some MLMs May Be Pyramid Schemes
That’s exactly why some unscrupulous fraudsters have latched onto the MLM business model and used it to create pyramid schemes. MLM is perfectly legal in both the U.S. and Canada.
Pyramid schemes are not!
Legally the core difference between MLMs and pyramid schemes is that MLM companies make money off selling products and/or services; pyramid schemes make money off you. In other words, the main focus of a pyramid scheme is to get you to put your money in and recruit others to do the same, rather than on moving product or services.
If you are in any doubt that an MLM company you are interested in is a legitimate company or an illegal pyramid scam, ask these six questions. And if the answers to any of the questions are dodgy, stuff your wallet back in your purse or pocket and run– it’s a chance to go to jail, not to make money.
You Could Make a Lot of Money
By working for a legitimate MLM ordirect sales company, though, you could make a great deal of money.
In her book Second-Act Careers, Nancy Collamer tells the story of Karen Pagliurolo, a former nurse and stay-at-home mom, who now makes a fortune as a regional manager and sales consultant for the high-end direct sales fashion company Etcetera, hosting trunk shows four times a year in the basement of her home in Winchester, Mass. A Herbalife consultant on the president’s team can earn as much as $480,000, the nutrition-supplement seller says on its website.
And there is a millionaire Avon lady, Debbie Davis in the UK. The Daily Mail reported that she and her partner earned ₤ 1.4-million in 2010 – making them the make-up company’s top earners in the UK for the fifth year running. Others to mention are Onggy Hianata from Qnet Indonesia. He become a millionaire from his MLM with Qnet.
Business Opportunity– How To Start Your Online Business
The first thing you will need to do is find a product that you would like to sell. These products usually have an affiliate program associated with them, allowing you to make money as a result of selling someone else’s product. A common example of this type of marketing opportunity is that which is offered by Amazon.com.
They sell millions of products on the web, and if you sign up for their associate program, you will make a small percentage of every sale that you generate by creating a website or blog and posting one of their links. Next, you will have to create a website or blog in order to present this information online.
You will have to write content in a review format talking about the product that you are selling. You will want to properly optimize your website so that it can rank well on the search engines. It’s always best to get organic traffic as it can become very expensive paying for each click to your website if you use traditional advertising. Once you have your website, your affiliate link, and unique content on your main page, you can start to get backlinks to your website or blog in order to improve its position on the search engines.
Many MLM companies also offer top sellers bonuses such as Mary Kay’s famous pink Cadillacs.
How Much Work Are You Prepared to Put Into Your Direct Sales or MLM Business?
The true answer to the “how much money will I make?” question depends on you. You Might Not. As Ms. Collamer says herself in Can You Really Make Money in Direct Sales? (Forbes), “most people who go into direct sales aren’t as successful”. And in fact, according to the Direct Selling Association, the median annual income for direct sales consultants in 2011 was $2,400.
In 2017, 50% of those who received earnings from Herbalife earned less than US$ 370 a year, while just 10% made US$ 6,965 a year, according to the company. And according to Herbalife, less than 15% of their distributors in the US earned any money from them. To be fair, though, not everyone who has signed on with a direct sales company as a contractor or consultant is actually doing it to make money. Internal consumption, as it’s called, is common in direct selling and MLM companies.