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Variations of Multi Level Marketing Schemes

Variations of Multi Level Marketing Schemes

Network marketing has captured the attention of millions of people worldwide. Amway, Tupperware, Avon, Nu skin, Herbal Life & Oriflamme, etc. they have become world-renowned names and have established themselves as premium products thanks to the MLM sales and distribution strategy that these companies have adopted.

The novel concept of MLM or network marketing involves the sale and distribution of products through distributors who buy products for their own use and focus on recruiting and building a network of distributors below them so that sales are made automatically when each from distributors buy products for their own use and promote the recruitment and construction of networks under them. This sales and distribution format is also called Pyramid Sale.

Although the concept has been very successful and the success stories of people who have earned millions through their MLM network have been publicized worldwide, there have been many criticisms, cynicism and unfair commercial charges that have been directed against the MLM system. .

MLM companies have been members of the Direct Selling Agents Associations and have complied with the regulations and commercial systems established by the authorities for said system. It is seen that companies that have continued to invest and focused on high quality products have prospered in the market using the MLM network to sell and distribute their products. It is only the quality of the product that allows people to become distributors and buy the product for their own use. With the amount of training and product knowledge provided to Distributors, along with their own product experience, it helps to create larger volumes of business through the network.

Variations of the MLM concept

The success of the MLM network worldwide to sell the products through the Distributor chain has paved the way for the creation of several modified concepts or variations of the MLM networks. There have been schemes in which networks of distributors have been established to sell not the products of a single company, but to provide a catalog of products of several companies and invite distributors to buy those products that they consider useful and necessary. In many cases, the catalog circulates as a periodic publication and the subscription is charged when distributors subscribe to it. At the same time, each Distributor obtains a discount in the catalog that he requests for his network and, therefore, also obtains an income here. As a concept, such a system looks fantastic. However, when it comes to the participation and ownership of the various companies involved in the supply of products with respect to product quality, training, as well as guarantees, etc., there are possibilities for companies to reduce expectations and the complete system go aimlessly.

Chain letters

Simulating the success of the MLM Networking concept, there have been several types of networks and concepts that have been circulating in different countries at different times. One of those schemes that keeps going around is the Chain Letter Network concept, where you receive a letter asking you to send a small amount like $ 5 to the five people listed in the letter and then make as many copies of it incorporating your name in the top of the list and send it to others repeating the same instructions. When people read your letter, they will send you $ 5 and circulate more letters by adding your name to the list. Therefore, you will continue to receive the money with the expansion of the network. This happens to be simply a scheme to make money without products or sales in real terms. Although people realize that such a scheme does not generate any real long-term income and does not imply any type of trade, there are still some left and so the plan continues. You will find different adaptations of such schemes and they all seem to be in line with the trade regulations of the countries as well.

Such schemes may work in theory based on multiplier effects, etc., but morally and ethically the schemes will not benefit from any support from the community in general. Therefore, it is important to understand the MLM scheme in detail and then decide or choose a scheme that is genuine and more appropriate for you.
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