Pyramid schemes seem to be the bane of multi level marketing (MLM). There is a terrible misconception about MLM that everyone who is not within the MLM circle refers to these opportunities as 'pyramid schemes'. There were companies that used them; however the true root of the meaning is now lost in translation and every MLM opportunity tends to be incorrectly labelled by those looking in.
The definition of a pyramid scheme (according to Wikipedia) is: a non-sustainable business model that involves the exchange of money primarily for enrolling other people into the scheme, often without any product or service being delivered.
The summary in reference to MLM is: one person recruits five people, and they each recruit five people, and they each recruit five people. The end result on paper looks like a pyramid with the person on top earning the most money. However, picture this: A big corporation has the CEO, under him are eight senior vice presidents. Under each of them are six vice presidents. Now keep going and going until you reach the thousands of worker bees. If you picture this on paper, it looks like a pyramid too, of course, with the person on top earning the most money.
For some reason MLM has been incorrectly labelled as a 'pyramid scheme'. All the skeptics refer to any home business model based on a commission as a pyramid scheme. It seems to revolve around the shape on paper and not around the true meaning. If this is to be the case, then every healthy corporation is a 'pyramid scheme'. Now, we know this is clearly not the case.
If you are looking to get involved in MLM then do not look at it from the aspect of getting involved in a pyramid scheme. More and more people are looking to start their own business at home. If you are at all worried about the legitimacy of the opportunity then go do your research. The internet is a fantastic and extensive tool at your disposal. At the end of the day the only real way for the average person to make big money is to own your own business. There are tons of fantastic companies offering MLM opportunities and one of them is bound to suit you.
If you are in MLM, or getting started in MLM then try your best to educate people. Do not refer to your opportunity as a pyramid scheme. Try get rid of the phrase as you are not doing yourself or anyone else any favors.
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Richard Nicholls is the owner of richnicholls.com/2009/10/pyramid-schemes/"> RichNicholls.com and MyHomeBusinessGuide.com giving applicable information to those new and looking to advance in the MLM industry.
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