Multilevel Marketing a Slippery Slope?

by admin on June 15, 2011

Multilevel marketing schemes, often known as Ponzi schemes promise returns to people not through profit, but through the investments of others. The catch is where the people at the top make boatloads of money while those at the bottom feel cheated and lied to as they invest their time and money, yet never seem to make a return on anything they receive. Multilevel marketing is often times successful for those that get in at the bottom floor or start of a company, while others simply hear the glory stories and yet never see such money. This goes back to the original idea of a scam being part of a multilevel marketing form, however there are many companies that are completely legitimate in how they make and pay out their investments to people part of the company. The difference is in the way that a multilevel marketing company is run, when the return to you is supposed to be so high, the money has to come from somewhere down the chain. Where the money comes from in a scam is simply the investments of others which will mean that they never see money returned from their time and efforts. However where the company runs a legitimate multilevel marketing company, they receive the money that is paid out to the representatives not from other representatives, but from profits on the product. It simply goes to show that you must know where the money is coming from in a multilevel marketing company, and that will take some research on a company you are considering on joining.

 

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