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I've never been a huge fan of
multi-level marketing or network
marketing.
Having
said that, it would be hard to have a site on
Home Based Business without a mention of either
of these two business formats, as many fortunes
have been made through these types of business
opportunities. First let's define Multi
Level Marketing. the WikiPedia definition is as
follows, "Multi-level marketing
businesses function by recruiting
salespeople (also called Distributors,
Independent Business Owners, IBOs, Franchise
Owners, Sales Consultants, Beauty
Consultants, Consultants, etc.) to sell a
product and offer additional sales
commissions based on the sales of people
recruited into their downline, an
organization of people that includes direct
recruits, recruits' recruits,
etc." What this basically means
is that in order to succeed in an MLM
you must build a downline. If you are
a natural networker this may come easily to
you. Not only do you need to recruit
you need to retain and motivate your
downline to sell more. You also need to keep
apace with their sales volumes as
well. Some MLM's require that your
personal sales volume must be greater than
your top sales person in your
downline. This is easier
said than done.
MLM's historically have been
associated with illegal and fraudulent
activities citing such illegal activity as a
Ponzi Schemes (A Ponzi scheme is
a
fraudulent
investment operation that involves paying
abnormally high returns
("
profits") to investors out of the money paid
in by subsequent investors, rather than from
net revenues generated by any real
business, named after
Charles
Ponzi.)
or Pyrimad Scheme. There are
some legitimate MLM's however you
really need to do your homework if a
business opportunity that you are
interested in requires a
downline.
The reason why so many people
are drawn to MLM's or Network Marketing type
opportunities is simple, when they really work
they can generate tremendous amounts of cash
usually from the extensive downline
organization they build by recruiting others to
join in the business model who in turn recruit
others and so on.
We have researched some
articles and resources for your further
edification. Our bookstore provides
several books that help in the MLM evaluation
process.
You can
also read the Federal Trade Commission's
Alert on MLM's here. (You need the Adobe
Acrobat Reader) As the FTC report states,
there are numerous legitimate MLM's and Network
Marketing opportunities and companies, you
must use extreme caution before getting
involved or investing your
money. You can
also use other services to perform background
checks on either upline managers or downline
applications here:
SSN Background Checks - Search using social security numbers .
IMPORTANT: As much as
you would like to believe that you have found
your dream business in a MLM, or an MLM
recruiter has sold you, hook, line and sinker
about their MLM, do yourself a big favor and
research the company and the recruiter. You can
do your research and get information on an MLM
before you sign up by getting a background
check from Hoover's. It's a good time to use
Hoover's as they are currently running a
promotion whereby you can get 30% Off Hoover's Company &
Industry Reports right now. It's the right way
to get involved with any MLM or Network
marketing company.
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