MLM, would have been the best business model because of the opportunities it creates for many people but another model now creates similar wealth creating opportunities without the fraud-like impact of MLM on those who sign in late. (Not talking about MMM or Affiliates)

Having said that, many things people say about MLM is not peculiar to the model. Let's see..

Fraudulent Nature?

Okay, just take a look at the lotteries and tell my why they are not legalized Ponzi schemes. Look at all the big companies' "win cars", "Salary for Life" and so on promos. Which one is not more fraudulent in nature than MLM? Are wonder banks not even better than all the monies you loose trying to participate in Who Wants To Be A Millionaire? At least many people get paid compared to their big brothers' frauds. Just sayin...

The Pyramid Nature?

Almost all businesses have the pyramid nature only that it is more obvious with MLM.
You have the CEO, the GMs, the Managers down to the non-management staff. They say everybody is important, yet they are not paid equally.
Then you have major distributors, subdealers/ wholesalers, and retailers- that is definitely a pyramid and many retailers are more or less like MLM distributors saturating the market without making much profit.
It's just an issue with perception and a myth.

Early-Starters Take All

Other businesses have major distributors or dealers who take over specific local territories and no one else can sell at their level- early-starter takes it all. Anyone else gets a "No, we don't need distributors in that place again."
Imagine you just discovered a product with great potential, you know you have the financial capacity to become a dealer but when you contacted the company you are told, sorry you have to buy from dealers. That is the same effect market saturation has on new MLM associates. The difference is that no audible promise was earlier made in the former case.
Also, if you know what is called MONOPOLY, you will realize quickly that this issue is not limited to MLM.

Expensive Registration Fees?

I am yet to meet an MLM company that charges their distributors or associates the fees that many other companies charge their distributors. I have also not seen any MLM that will charge you what many franchisors will charge intending franchisees, and that's aside royalties and other fees. Becoming an MLM distributors has even been regarded as mini-franchising.


THE REAL ISSUE

When people invest money in something, you should have an assurance you will get money back if nothing beyond human control happens. I think that is the main issue. The government should not be too eager to shut down any business model that creates opportunity for people, they should regulate it. I'm yet to understand why we allow tobacco companies that are destroying many lives to exist, as well as Casinos; yet we blackmail MLMs and call them Ponzi Schemes. If people decide that Ponzi schemes give them what the government cannot- even with lotteries, why should the government make them illegal? Should people only be permitted to "drink responsibly" can't they be allowed to "invest in Ponzi Schemes responsibly"? Just thinkin

If MLMs act like other business models and monitor the population of their associates in a given region to ensure the market is not oversaturated, and if they are fast about opening up international markets to any of their associates or distributors, the fraudlike effect will be minimized. But the nature of MLM model makes it difficult for every one that joins to have a fair share of the promises made.


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First published here: House-Era.com
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