Difference Between MLM Pyramid Scheme – Review

How many times would you’ve been approached about the next best never seen before Multilevel marketing opportunity?

If it’s like most of us, it’s more times than worth mentioning. And, the next one is always the secret formula to the evergreen “Golden Casket”. But, is any of it real? Of course not.

In reality, direct marketing is all about selling products directly to the public without any strings attached. And, undoubtedly a viable opportunity for starting a home-based business that over time will generate sustained income. Let me explain why.

Starting with anything new in life always takes time to adapt and adjust to its workings, and direct marketing is no different and any way or shape.

But, when it comes to MLM marketing comes a brand new ball game, riddled with scams, pyramid selling and an overwhelming amount of innuendo.

With this MLM Review, I’ll go inside pull it apart by exposing many pitfalls that exist.

How Did The MLM Business Start?

Multilevel marketing, (MLM), originally started back in the 1920s by a company called, California Vitamin Company, known today as Avon Products.

Since the early days, it has grown into an International Goliath, with a piece of baggage of shame and dishonesty.

What Are Low-Quality Products

Predominately companies who sell products that are either of inferior quality or cheap and nasty are hell-bent on recruiting. Those in the top of the tree are primarily not interested in selling products. Their focus is surrounded by recruitment as that’s where all the money exists.

What Is High Priced Products?

Products are sold usually at ridiculous prices in comparison to identical goods sold in retail outlets.

Why is that? Because it’s nothing more than, a camouflage to cover up their primary focus on recruiting.

Also, not be seen as operating a pyramid scheme and stay within the legal requirements of FTC regulations. When in fact, that’s not true.

Defining an MLM Scam

There are many ways where scams seem to bubble below the surface. They seem mostly to gurgle around the wellness industry who make foolishly optimistic claims that are nothing other than ballyhoo.

So, it’s not a matter of you exposing them, because they reveal themselves.

Startup Costs

MLM businesses front end load their opportunity with the promotion of little or no startup costs. Not true.

How can you earn an income if you haven’t any products to sell. It’s just another promotional furphy.

On the other hand, you can almost wager your bottom dollar; your sponsor will encourage you into buying a quick-start kit worth many hundred’s of dollars. No, not the cheapest, the dearest. Why? Because, they get a quick start bonus. So naturally, they have a vested in only mentioning the highest priced kit.

Distributors Pressured Into Auto Shipping

Bonuses are paid only to distributors who retain an active status month on month. With that comes a minimum order requirement linked to a product value (PV).

By not missing out on bonuses, you’ll be encouraged to enlist into their auto-shipping program. And in some instances, it’s part and parcel of the sign-up process. What they don’t tell you, it’s their insurance of committing you to a monthly order. Each month your credit card is debited, your order is processed and forwarded to you. Too bad if you haven’t earned enough to pay for the next shipment. Do you think are worried about that? Not in your sweet Nelly.

Difference Between MLM Oyramid Scheme

What Is A Pyramid Scheme?

A Pyramid Scheme is naked by nature because there’s no product to sell, and it works on the following principle.

One person recruits ten other people to join in a “no-fail investment opportunity.”

Each of the ten recruits pays the sponsor $200, who suggests they repeat the recruiting process.

Presumably, each of the ten recruits finds ten more recruits, and each will end up with $1,800 profit from their $200 investment.

How Does It Work

Has the appearance of being simple enough. But is it?

The Pyramid continues to multiply itself by ten.

Let’s say, for instance, the initial ten recruits each find ten more people. That’s 100 recruits who will have to each find ten recruits to make $900.

In essence, it’s multiply by ten systems.

100 X 10 = 1,000

1,000 X 10 = 10,000

Difference Between MLM Pyramid Scheme Disaster

Frankly, it’s unmaintainable as there won’t be enough recruits at the bottom of the pyramid to support the level above it. That’s when the pyramid topples, and everyone at the bottom loses their investment.

Candidly, pyramid schemes are nothing more than a make money scheme with a concise life cycle.

Why It Attracts Gullible People

When explained, those who are quickly taken in by the possibility of making large amounts of money for just a small investment are the outright victims of the system.

The scheme works on an upfront payment venture encased around an immoral principle, focusing on large numbers of people, and money-making.

Unfortunate but true, those who are short on cash and looking for a quick money-making idea are most susceptible to the pyramid scheme.

I suppose, in some ways, it’s much like a revolving door, more new faces more money to the operators of the scheme.

How Does the Payment System Work?

Payments are usually on a monthly cycle and calculated on new membership. Mind you though, most of any new money goes straight to the top, (those who are running the shonky operation),

In the primary, pyramid schemes rely upon the recruitment of new members and those repeating the cycle.

They are nothing more than an illegal system with false promises to a get-rich-quick scheme. And in almost every case people lose lots of money.

They are at best a precarious proposition and best to steer clear unless you are prepared to lose your hard-earned.

What Are The Alarm Signals?

Alarm signals should start going off immediately you’re asked to pay money upfront, and how you can make some easy money just by recruiting others to join.

Another Warning

Those running a shady operation, and using the same selling method as above, pull, on the heartstrings of those looking for a get-rich-quick deal, and with a small investment to get started, using the same selling method as above.

The underlying factor within a pyramid scheme is to make the ring leaders wallets fatter while the grassroots investors lose everything.

Mind you, some startups can be quite a hefty investment, but the wily operators are cunning enough to know a smaller initial investment attracts lots more people.

Saturation Point

Eventually, the scheme begins to fall over as realization hits enrollees with the thought that it’s impossible to recruit successfully, so they drop off. Cracks soon appear, and the system starts falling away. It’s a bit like a large dam soon as a break occurs in the wall, water eventually finds a way through, ultimately forcing the wall to open up.

The promoters don’t care; they have accomplished what they set out to achieve. And, that’s making lots of money in the process.

Why Is Multi-Level Marketing A Connector?

It’s not uncommon to see how easy it is for people to become confused in deciding which is legal and which is not.

MLM business opportunities and pyramid schemes look similar. And the likeness is so close you could be forgiven thinking what you are joining is a legitimate MLM business, but actually, it’s a pyramid scheme.

According to the Federal Trade Commission (FTC),

Some MLM businesses are, in fact, illegal pyramid scheme networks. And those who get involved in a fraudulent operation, ultimately finish losing their money. At the same time, others find themselves not only out-of-pocket but, heavily in debt. So don’t be fooled into believing all MLMs are legal.

In most instances, you’ll find most MLM businesses operate similarly to a pyramid system, but manage in keeping within the guidelines that define the two.

Watch When Recruitment Is The Focus

Understanding what separates the two will serve you well. Where the critical focus is about recruitment and products being a secondary, it’s then that you should ask yourself is this legitimate. The best way to determine that, ask lots of questions, conduct your research, read reviews about the company and only then will you be in the best place to make a well-informed decision.

Difference Between MLM Pyramid Scheme Recruiting

Don’t be rushed into making hasty decisions, usually when rushed, that is a red flag and should be processed accordingly.

Final Thoughts

Irrespective what’s said to you regarding snapping up the opportunity while it lasts is nothing more than a sales pitch. If the option is available today rest assured it’ll still be there tomorrow and the day after.

Don’t be afraid to ask hard-hitting questions, even if your sponsor sees them as meddlesome or prying. Without appropriate answers, how can you decide? After all, it’s a business deal you’re negotiating, and information is crucial to your long term future.

Deciding without first carrying out research is a recipe for disaster.

Web-Spinning Approaches

While this report is only a tip of the MLM iceberg, be aware operators use a litany of web-spinning approaches, littered with traps and loopholes in luring you into their web of disaster.

Negotiate with a suspicious mindset, think along the lines that a more significant majority of MLMs are camouflaged con jobs, with one eye on your wallet and the other on destroying your business endeavors.

Pyramid Schemes

For Pyramid schemes steer clear at all cost, they are illegal and a money-sucking venture at best.

Any venture that requires large chunks of money upfront and entirely driven on recruitment. Walk away.

They are motivated by money, your money, and when the scheme collapses, they’ll skip town leaving you, broke, and more likely in debt.

If you are keen about starting your own business where you’ll be in full control, check out my #1 blue-chip endorsement.

Apart from being in control of your own business, you can work from the comfort of your own home, even while away on holiday, that’s how portable it is.

Furthermore, all the tools and guidance are all there to help you along the way to success.

The Real Deal Affiliate

 

 

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