The person building their downline will try the 3 Ps if confronted.
Pretend they don't get that it's a scam.
Petulantly claim that you're just being mean.
Push you away if you press them with the truth.
Saturday, May 21, 2016
Wednesday, May 18, 2016
Vector is a Scam
Vector - like Amway, Herbalife and a thousand other Multi-Level Marketing businesses - is a scam.
If you are offered a job with them, be aware that it is not a real job. While they used to make you buy their knife set with the promise that you could then sell it to another for a profit, they got so much flack on that fraud that they went to where they'll loan you the first knife set, and you can see if you can sell that. Which since they tell you to hit up your family and friends "first", makes for a small chance of getting that first - and often last - sale. THEN you can buy from them and sell at a profit. They might forget to mention that when you run out of that rich and kind Aunt of yours who paid $450 for what I could get for less than a Benjamin at Walmart, that your sales will be....scant. "Scant" being an exaggeration from the "zero" that it is for most.
Yes, a 1996 expose showed that less than half of their "workers" earned anything at all, and many lost money. Instead of $17 an hour, it was either zero per hour, or going in debt! And - to save someone the trouble of mentioning this - they've "changed" since then. Yep, just ask them. They changed. It's a fascinating media history of Vector, for each decade you can read from reputable sources about how they scammed college students, were caught, sued, lost, and were in trouble. Then "changed" and swore they were just fine! They were bad but "changed" in the eighties. And oopsy, they were bad again and "changed" in the nineties. And, goodness, they were bad again and "changed" in the oughts. And now, bad again. Still changing. In fact, call them, I'm guessing they "changed" just in time to treat you fairly! *rolls eyes*
The unfunny truth is that they "change" each time they are caught defrauding people, and then defraud others again at once.
Now let's say you're the rarity and make the first sale to Aunt Moneybags, well, then you get to buy the second set! So they'll either have no losses - assuming you failed to sell the first one and quit. Or they'll have two guaranteed sales, the first one you made to the family member who pitied you, and the second to YOU because you thought that you could convince a stranger to overpay you as easily as a relative! And when you fail, well, congrats, you've got a knife set!
But...but...the person who offered me this job is my cousin/is my college buddy/is a member of my church! Yeah, that's lousy, it truly is. But this scamming company not only trains them to sell the overpriced goods nearly exclusively to friends and families, they are encouraged to recruit their "down line" the same way. And friend, relative or church member, they're still human. With all the flaws and foibles that we all have.
Including, in their case, a propensity for get-rich-quick schemes and being casual with the truth when it comes to money making opportunities. Just remember, everyone who ever scammed another is someones relative, friend or church buddy.
But this is "He said, she said, they said, the others said", it's all a matter of opinion, right? I mean, why should you believe me? Besides, that other person recruiting is so darn nice, not grumpy and cynical like me, huh? And does anyone really want to believe bad of a relative, friend or such?
Well, don't believe me, then. Certainly not just on my word. Go study and learn for yourself. In other words, do your due diligence.
Ask the person offering you this allegedly $17 per hour job to show you their pay stubs from Vector, Alcas, Cutco or whatever name they're playing under today. Does it show anything that any CPA - or High School consumer economics student - could reasonably believe to be $17 per hour over any reasonable amount of time?
No, it won't. Surprise, you aren't working as their employee, you're an "independent contractor". In other words, you buy from them (or get it loaned), and they sure wish you well in you being able to sell enough of what you bought to make $17 per hour. But you won't. Not even close.
"But Dean, it says on their website that they pay you a commission whether you sell or not!" Glad you read their site. Did you notice that it said "to a qualified potential customer"?
I ran into this when I was a young and ignorant kid in Idaho. Selling Kirby vacuum cleaners on commission. I'm sorry, not sales, I was "demonstrating home maintenance systems", because, as I was told, they "sold themselves". They promised to pay me no matter what, too. So long as I demonstrated it to a "qualified potential customer" a given number of times per week. Which turns out to be someone who is willing to say over the phone to your boss, "Yes, I'm dying to buy this right now!"
At which point your boss goes out and makes the sale! Other than that, you've just demonstrated it to a random person, not qualified, and thus no pay for you. I mean, c'mon, you weren't really expecting anyone to pay you $17 an hour to go visit your friends all week and then call in, "Nope, no sales, but I got in a solid 40 hours "demonstrating", so that'll be $680 please!" (I could get into how you're going to need some tax advice on how to do your SS, UI and other such contributions as an independent contractor, not to mention the special forms, but that would assume you would actually be having money coming in, and so I don't need to bother.)
A part of due diligence is also you doing the "best case math". What if you sell a $450 knife set - how much do you get to keep? $45? I doubt it, but let's pretend it's $45. To make $680 a week (that $17 per hour) you'd have to sell 13 to 14 sets of these nearly $500 sets per week! Really? REALLY? To you, my friend reading this right now, you may think you're a salesman, you may think you're a better salesman than I, you may actually BE a better salesman than I - but you are NOT a "sells SEVEN GRAND worth of knives per week" good salesman!
And what's minimum wage? $8 per hour? So that's $320 per week, and you'd "only" have to sell a bit over seven sets a week for that. "Just" $3,500 worth of knives - assuming that Vector is giving you a ten percent commission, which oh, by the way, they won't be! You starting to see how rock bottom hopeless this is? How much incredible work, skill, luck, dumb relatives and such that you'd have to begin to have to make what you could get at Labor Ready in half the time and twice the honesty?
If you quit in disgust, then Vector has won to the extent of whatever you may have sold to a relative or two. If you plug away, you'll find out later that the easiest way for you to make money is NOT by selling the knives, but by convincing another person to sell knives and you get a piece of that. So if you can trick two buddies or four buddies or six buddies into doing this, and they each have an affectionate Aunt to help them get started, then voila! You've discovered how it works - and why the person trying to get you to do this is REALLY trying to get you to do this!
The sucker you'll have to look for later when you're in it? You're the sucker of the person who's already in it!
What more can be said?
Vector is a scam.
If you are offered a job with them, be aware that it is not a real job. While they used to make you buy their knife set with the promise that you could then sell it to another for a profit, they got so much flack on that fraud that they went to where they'll loan you the first knife set, and you can see if you can sell that. Which since they tell you to hit up your family and friends "first", makes for a small chance of getting that first - and often last - sale. THEN you can buy from them and sell at a profit. They might forget to mention that when you run out of that rich and kind Aunt of yours who paid $450 for what I could get for less than a Benjamin at Walmart, that your sales will be....scant. "Scant" being an exaggeration from the "zero" that it is for most.
Yes, a 1996 expose showed that less than half of their "workers" earned anything at all, and many lost money. Instead of $17 an hour, it was either zero per hour, or going in debt! And - to save someone the trouble of mentioning this - they've "changed" since then. Yep, just ask them. They changed. It's a fascinating media history of Vector, for each decade you can read from reputable sources about how they scammed college students, were caught, sued, lost, and were in trouble. Then "changed" and swore they were just fine! They were bad but "changed" in the eighties. And oopsy, they were bad again and "changed" in the nineties. And, goodness, they were bad again and "changed" in the oughts. And now, bad again. Still changing. In fact, call them, I'm guessing they "changed" just in time to treat you fairly! *rolls eyes*
Now let's say you're the rarity and make the first sale to Aunt Moneybags, well, then you get to buy the second set! So they'll either have no losses - assuming you failed to sell the first one and quit. Or they'll have two guaranteed sales, the first one you made to the family member who pitied you, and the second to YOU because you thought that you could convince a stranger to overpay you as easily as a relative! And when you fail, well, congrats, you've got a knife set!
But...but...the person who offered me this job is my cousin/is my college buddy/is a member of my church! Yeah, that's lousy, it truly is. But this scamming company not only trains them to sell the overpriced goods nearly exclusively to friends and families, they are encouraged to recruit their "down line" the same way. And friend, relative or church member, they're still human. With all the flaws and foibles that we all have.
Including, in their case, a propensity for get-rich-quick schemes and being casual with the truth when it comes to money making opportunities. Just remember, everyone who ever scammed another is someones relative, friend or church buddy.
But this is "He said, she said, they said, the others said", it's all a matter of opinion, right? I mean, why should you believe me? Besides, that other person recruiting is so darn nice, not grumpy and cynical like me, huh? And does anyone really want to believe bad of a relative, friend or such?
Well, don't believe me, then. Certainly not just on my word. Go study and learn for yourself. In other words, do your due diligence.
Ask the person offering you this allegedly $17 per hour job to show you their pay stubs from Vector, Alcas, Cutco or whatever name they're playing under today. Does it show anything that any CPA - or High School consumer economics student - could reasonably believe to be $17 per hour over any reasonable amount of time?
No, it won't. Surprise, you aren't working as their employee, you're an "independent contractor". In other words, you buy from them (or get it loaned), and they sure wish you well in you being able to sell enough of what you bought to make $17 per hour. But you won't. Not even close.
"But Dean, it says on their website that they pay you a commission whether you sell or not!" Glad you read their site. Did you notice that it said "to a qualified potential customer"?
I ran into this when I was a young and ignorant kid in Idaho. Selling Kirby vacuum cleaners on commission. I'm sorry, not sales, I was "demonstrating home maintenance systems", because, as I was told, they "sold themselves". They promised to pay me no matter what, too. So long as I demonstrated it to a "qualified potential customer" a given number of times per week. Which turns out to be someone who is willing to say over the phone to your boss, "Yes, I'm dying to buy this right now!"
At which point your boss goes out and makes the sale! Other than that, you've just demonstrated it to a random person, not qualified, and thus no pay for you. I mean, c'mon, you weren't really expecting anyone to pay you $17 an hour to go visit your friends all week and then call in, "Nope, no sales, but I got in a solid 40 hours "demonstrating", so that'll be $680 please!" (I could get into how you're going to need some tax advice on how to do your SS, UI and other such contributions as an independent contractor, not to mention the special forms, but that would assume you would actually be having money coming in, and so I don't need to bother.)
A part of due diligence is also you doing the "best case math". What if you sell a $450 knife set - how much do you get to keep? $45? I doubt it, but let's pretend it's $45. To make $680 a week (that $17 per hour) you'd have to sell 13 to 14 sets of these nearly $500 sets per week! Really? REALLY? To you, my friend reading this right now, you may think you're a salesman, you may think you're a better salesman than I, you may actually BE a better salesman than I - but you are NOT a "sells SEVEN GRAND worth of knives per week" good salesman!
And what's minimum wage? $8 per hour? So that's $320 per week, and you'd "only" have to sell a bit over seven sets a week for that. "Just" $3,500 worth of knives - assuming that Vector is giving you a ten percent commission, which oh, by the way, they won't be! You starting to see how rock bottom hopeless this is? How much incredible work, skill, luck, dumb relatives and such that you'd have to begin to have to make what you could get at Labor Ready in half the time and twice the honesty?
If you quit in disgust, then Vector has won to the extent of whatever you may have sold to a relative or two. If you plug away, you'll find out later that the easiest way for you to make money is NOT by selling the knives, but by convincing another person to sell knives and you get a piece of that. So if you can trick two buddies or four buddies or six buddies into doing this, and they each have an affectionate Aunt to help them get started, then voila! You've discovered how it works - and why the person trying to get you to do this is REALLY trying to get you to do this!
The sucker you'll have to look for later when you're in it? You're the sucker of the person who's already in it!
What more can be said?
Vector is a scam.
My Mean Dad
When my brother and I were kids, we noticed that other kids had cool dads who would take the kids candy ordering sheet or Walk for Mankind sponsor sheet to their job and get people to order candy from them, or sponsor them!
But our Dad refused to do that.
My brother and I both thought that was kind of mean, but we understood. See, my Dad was the manager of his department. To ask his employees to sponsor us or buy candy from us or raffle tickets would have put them in a bad position.
True, he could have assured them that they did not have to participate, but who are we kidding? It would have been awkward for them to say "no", and some would do it just for wishing to curry favor or avoid him not liking them.
I see now that was wise and good of him.
And I'm reminded of it every time I see someone in any kind of power position, job, rank or social position doing just that with MLMs.
You know what I mean. The foreman of your local factory invites you over for dinner out of the blue and - SURPRISE! - his son discovered Amway! Or maybe it's the Colonel's wife herself who sells Avon exclusively to all the wives of the Majors and Captains under her husband. Wives who'd prefer to go to the PX, but know better.
This is what makes the truth of what I've said before so apparent - the Minister's wife might get away with some MLMing, but the Usher's wife never will. It can be the same products, and the Usher's wife can be the better salesperson, but the Minister's wife will be the one pulling in the money.
Because at the end of the day, ALL MLM products depend on these and more tricks to sell at all. Because, oh, yeah, they're selling - at best - average products for too high prices. Stuff that could be got easier and cheaper at stores or online.
What's then the reason for those in these various minor to medium power positions doing it? Because they can! It's not like they're better or worse than anyone else. It's just that they have the ability to do it, and thus have more temptation to it then those who know they can't.
Picture that Colonel's wife. Sure, some of her customers will be the wives of ladder climbing Majors. But some will be those wives who genuinely wish to meet a higher status woman and see how she lives. This let's them into her house, and with a chance to get to know her.
They may even believe - and it be true in their particular case - that the money is well spent on what a lobbyist would call "access".
Yet it harms all the same, for while some few may not mind this, others are roped in for the fear their husband's have, or the desire to not be left out in the cold from some important social circle. And in all cases it is a presumption and imposition by the person selling, as he or she at least knows the real nature of the products and why they sell.
Next time you find yourself at a "party", look about. Are all of you just below the host/hostess in status? If there are one or two above, are they the exceptions?
Because I honestly cannot easily conceive of any case where the guests are of predominantly higher status. And I doubt any reading this can either. That should tell everyone the tale.
Because in the real world, the non-scamming, non-MLM world, it is the clerk of lower status offering good and affordable products to those of pre-dominantly higher status. And if there are job offers, then higher status sales folk will be recruited by a lower status HR guy.
That's how that works - when it's a real product being sold or a real job being offered. But with MLM, it's never the steak being sold, only and ever the sizzle, with a bit of tough ground round tossed in later. And for that kind of razzle-dazzle, you must have your marks - er, customers - looking up at you.
But our Dad refused to do that.
My brother and I both thought that was kind of mean, but we understood. See, my Dad was the manager of his department. To ask his employees to sponsor us or buy candy from us or raffle tickets would have put them in a bad position.
True, he could have assured them that they did not have to participate, but who are we kidding? It would have been awkward for them to say "no", and some would do it just for wishing to curry favor or avoid him not liking them.
I see now that was wise and good of him.
And I'm reminded of it every time I see someone in any kind of power position, job, rank or social position doing just that with MLMs.
You know what I mean. The foreman of your local factory invites you over for dinner out of the blue and - SURPRISE! - his son discovered Amway! Or maybe it's the Colonel's wife herself who sells Avon exclusively to all the wives of the Majors and Captains under her husband. Wives who'd prefer to go to the PX, but know better.
Because at the end of the day, ALL MLM products depend on these and more tricks to sell at all. Because, oh, yeah, they're selling - at best - average products for too high prices. Stuff that could be got easier and cheaper at stores or online.
What's then the reason for those in these various minor to medium power positions doing it? Because they can! It's not like they're better or worse than anyone else. It's just that they have the ability to do it, and thus have more temptation to it then those who know they can't.
Picture that Colonel's wife. Sure, some of her customers will be the wives of ladder climbing Majors. But some will be those wives who genuinely wish to meet a higher status woman and see how she lives. This let's them into her house, and with a chance to get to know her.
They may even believe - and it be true in their particular case - that the money is well spent on what a lobbyist would call "access".
Yet it harms all the same, for while some few may not mind this, others are roped in for the fear their husband's have, or the desire to not be left out in the cold from some important social circle. And in all cases it is a presumption and imposition by the person selling, as he or she at least knows the real nature of the products and why they sell.
Next time you find yourself at a "party", look about. Are all of you just below the host/hostess in status? If there are one or two above, are they the exceptions?
Because I honestly cannot easily conceive of any case where the guests are of predominantly higher status. And I doubt any reading this can either. That should tell everyone the tale.
Because in the real world, the non-scamming, non-MLM world, it is the clerk of lower status offering good and affordable products to those of pre-dominantly higher status. And if there are job offers, then higher status sales folk will be recruited by a lower status HR guy.
That's how that works - when it's a real product being sold or a real job being offered. But with MLM, it's never the steak being sold, only and ever the sizzle, with a bit of tough ground round tossed in later. And for that kind of razzle-dazzle, you must have your marks - er, customers - looking up at you.
Tuesday, May 17, 2016
Using Friends
If a person conducting a Multi-Level Marketing scam wanted to do well
at it, there are different things that would have to be done during any
recruiting effort.
1. Presume upon friendships or existing relationships where there will not be as much skepticism.
2. Misrepresent the nature of the job.
3. Fail to give the company name so that the person cannot immediately check to see how good or bad it is.
4. Engage in deception or out and out lie about the level of compensation offered.
5. Offer unrealistically high compensation in return for no experience or skills.
An "employment ad" that did any of those things would be a red flag as far as I'm concerned. What's remarkable when it comes to the example shown here is how it incorporates all of these things in one "ad".
2. Misrepresent the nature of the job.
3. Fail to give the company name so that the person cannot immediately check to see how good or bad it is.
4. Engage in deception or out and out lie about the level of compensation offered.
5. Offer unrealistically high compensation in return for no experience or skills.
An "employment ad" that did any of those things would be a red flag as far as I'm concerned. What's remarkable when it comes to the example shown here is how it incorporates all of these things in one "ad".
An "ad" that poses as just a friend offering anyone who needs aid a great job with great pay and bennies.
The sad reality is that they would be hard pressed to find 2 people making $680 a week there, given that to do that you'd have to either sell a $450 kitchen knife set to over a dozen people each week....or "demonstrate" the product in a 45 minute sales pitch 8 times a day, 5 days a week.
Remember - if someone, anyone, has to play it this way, it cannot be for a good thing. Picture any good company doing this with lies, trickery, manipulations and cons.
Good companies do not do that. Good people do not do that. I'd have more respect - I'd have any respect at all - for the person who posted this scam ad if they'd posted, "Hi, I work for Vector, a Multi-Level Marketing company! I know many believe all that stuff to be a scam, but I think it's great! I can help show you how to try and sell knife sets on commission, and if you can then convince others under you to sell even more, then you can potentially make a lot of money! True, that only happens for 1 out of 1,000 people, and the other 999 won't even break even let alone make a dime, but maybe you will be the lucky one, even though I'd rather that be me! Call me!"
But I guess this isn't a business where honesty would get them very far, is it?
The sad reality is that they would be hard pressed to find 2 people making $680 a week there, given that to do that you'd have to either sell a $450 kitchen knife set to over a dozen people each week....or "demonstrate" the product in a 45 minute sales pitch 8 times a day, 5 days a week.
Remember - if someone, anyone, has to play it this way, it cannot be for a good thing. Picture any good company doing this with lies, trickery, manipulations and cons.
Good companies do not do that. Good people do not do that. I'd have more respect - I'd have any respect at all - for the person who posted this scam ad if they'd posted, "Hi, I work for Vector, a Multi-Level Marketing company! I know many believe all that stuff to be a scam, but I think it's great! I can help show you how to try and sell knife sets on commission, and if you can then convince others under you to sell even more, then you can potentially make a lot of money! True, that only happens for 1 out of 1,000 people, and the other 999 won't even break even let alone make a dime, but maybe you will be the lucky one, even though I'd rather that be me! Call me!"
But I guess this isn't a business where honesty would get them very far, is it?
"No" means "Yes"
In the world of Multi-Level Marketing, "no" means "yes". There isn't anything you can say to a hard core MLMer trying to build his downline that is going to get him to back off. Short of rudeness. And so since they know you don't want to be rude, they'll keep pushing.
At the very least, if you're at some Hosted event "Party" or "just" a dinner in which - surprise, it's Amway! - you'll have to at the least pretend you're cool with it, or they'll try to flip it back on you, like you're the rude one for not wanting to be scammed.
To all this, there is only one defense. Okay, two defenses, but I'm speaking of the one that doesn't involve guns and defense attorneys. You must say "yes".
What? "But Dean, you hate MLMs! Why would you counsel anyone saying 'yes' to them?!"
Relax!
You tell them, "Yes, I'd love to do this, given how much of a sure thing you are telling me it is! But I'll need the start up fee fronted by you, with the agreement that I only have to pay it off with the big bucks I'll be earning!"
For all the MLMs that rely on that model of fronted money, that will basically end it. Oh, they'll wriggle and squirm and act like it's on you to come up with it, or how they aren't allowed or blah, blah nonsense. But so long as you're willing to do the job, and just need the money fronted as you're so darn poor, there's little for them to grasp on to in their little high pressure sales game.
Careful, though, as some will front you the product, but wish you to put a deposit down - do the same thing as if they were having you purchase it. You're too poor - if they believe in it so much, they should gladly front that deposit!
And still fewer will out and out front you the product, but usually with the condition that you must sell a given amount in a given time or be liable for the rest.
And fewest of all beyond that will say you can send the unsold part back, but watch out. It's rare for there to be no way of them getting money from you at all. Very rare. Like frog fur or political integrity rare.
But in the event that they are truly just counting on being able to bug your friends at a sales "party", and so are willing to front it all at no risk, then Plan B is that you simply claim idiocy instead of poverty.
"I'd do it, but I'm lousy at sales."
They'll try to counter this, of course. So here's the conversation you'll need:
You: I'm lousy at sales.
MLMer: That's okay, this stuff sells itself.
You: Then count on that. Because if I was near water, people dying of thirst would pass it by.
MLMer: Seriously, this is a great opportunity.
You: That's a pity. I really must insist that I know my lack of skill better than you do!
Now. Some of you are saying, "But Dean, if they're truly fronting it all, with no money down, no deposit, and no risk, why not host the party?"
For one, because that's never really going to be the case. If it were that easy, what the heck would they pay you for? Because you've that many great friends likely to buy? And they're failing to go to them directly why?
Oh, yeah. Because it's not that great a product, and/or it's over-priced, so they have to count on your friends purchasing the stuff out of pity for you, or to pander to you. That's then what they need of you, and why they're willing to front it all.
Because it's going to scam your friends. Which is why you still need to say, "No". Er, that is, say, "Yes", but like I explained! "Yes, but I'm too poor, dumb, and anything else bad to do this. Nope, you're too kind - I know how badly I suck. Nope, I can't learn, I'm just that dumb. Sorry."
"Can't. Sorry. Thank you. Wish I could. But I can't. Sorry. Can't. Thank you. Sorry." Just say those over and over till he/she moves on, sometimes after they give you a snippy comment on how they were trying to help or that you're a fool to pass this up. They'll do that for the audience, so that this will be on you, not them.
Repeat, "Sorry. Sorry." And let it go at that. Never engage. And never do the 20 questions where they ask a series of questions so that after you've said three "yesses", you feel like you can't say "no" to the fourth. Just "sorry", "can't", "thank you", "sorry" over and over.
This has been field tested. It's the only way to escape!
At the very least, if you're at some Hosted event "Party" or "just" a dinner in which - surprise, it's Amway! - you'll have to at the least pretend you're cool with it, or they'll try to flip it back on you, like you're the rude one for not wanting to be scammed.
To all this, there is only one defense. Okay, two defenses, but I'm speaking of the one that doesn't involve guns and defense attorneys. You must say "yes".
What? "But Dean, you hate MLMs! Why would you counsel anyone saying 'yes' to them?!"
Relax!
You tell them, "Yes, I'd love to do this, given how much of a sure thing you are telling me it is! But I'll need the start up fee fronted by you, with the agreement that I only have to pay it off with the big bucks I'll be earning!"
For all the MLMs that rely on that model of fronted money, that will basically end it. Oh, they'll wriggle and squirm and act like it's on you to come up with it, or how they aren't allowed or blah, blah nonsense. But so long as you're willing to do the job, and just need the money fronted as you're so darn poor, there's little for them to grasp on to in their little high pressure sales game.
Careful, though, as some will front you the product, but wish you to put a deposit down - do the same thing as if they were having you purchase it. You're too poor - if they believe in it so much, they should gladly front that deposit!
And still fewer will out and out front you the product, but usually with the condition that you must sell a given amount in a given time or be liable for the rest.
And fewest of all beyond that will say you can send the unsold part back, but watch out. It's rare for there to be no way of them getting money from you at all. Very rare. Like frog fur or political integrity rare.
But in the event that they are truly just counting on being able to bug your friends at a sales "party", and so are willing to front it all at no risk, then Plan B is that you simply claim idiocy instead of poverty.
"I'd do it, but I'm lousy at sales."
They'll try to counter this, of course. So here's the conversation you'll need:
You: I'm lousy at sales.
MLMer: That's okay, this stuff sells itself.
You: Then count on that. Because if I was near water, people dying of thirst would pass it by.
MLMer: Seriously, this is a great opportunity.
You: That's a pity. I really must insist that I know my lack of skill better than you do!
Now. Some of you are saying, "But Dean, if they're truly fronting it all, with no money down, no deposit, and no risk, why not host the party?"
For one, because that's never really going to be the case. If it were that easy, what the heck would they pay you for? Because you've that many great friends likely to buy? And they're failing to go to them directly why?
Oh, yeah. Because it's not that great a product, and/or it's over-priced, so they have to count on your friends purchasing the stuff out of pity for you, or to pander to you. That's then what they need of you, and why they're willing to front it all.
Because it's going to scam your friends. Which is why you still need to say, "No". Er, that is, say, "Yes", but like I explained! "Yes, but I'm too poor, dumb, and anything else bad to do this. Nope, you're too kind - I know how badly I suck. Nope, I can't learn, I'm just that dumb. Sorry."
"Can't. Sorry. Thank you. Wish I could. But I can't. Sorry. Can't. Thank you. Sorry." Just say those over and over till he/she moves on, sometimes after they give you a snippy comment on how they were trying to help or that you're a fool to pass this up. They'll do that for the audience, so that this will be on you, not them.
Repeat, "Sorry. Sorry." And let it go at that. Never engage. And never do the 20 questions where they ask a series of questions so that after you've said three "yesses", you feel like you can't say "no" to the fourth. Just "sorry", "can't", "thank you", "sorry" over and over.
This has been field tested. It's the only way to escape!
The Friend Exception
"But Dean!", the cry comes from the audience, "How can you speak so harshly about those who are in the Multi-Level Marketing business? My dearest friend sells Mary Kay, and she's just wonderful!"
Great. Glad to hear it.
I don't care.
This is like when someone talks about politicians and lists every bad characteristic that we all know that they all have, and then someone pipes up to share about their perfectly darling son who's a Town Councilman or State District Representative out in some Nowheresville area.
Then everyone is supposed to rush to assure her that, "Oh, of course, we just meant most are those things, we know some are great folks, heart of gold!" while inwardly thinking, "Whatever.".
I'm just the guy saying it out loud. Whatever. Politicians are in it for themselves, sorry if your cousin is one. And those who are making some bucks at MLM are scamming others to do so, at the least with the pushing of the not so valuable products, and more likely by the peddling of false hopes in trying to recruit them to their downline.
If your only argument is to try and personalize it, so that I must be afraid to speak for fear of offending you, then that's really no argument at all.
It's quite possible for a person to be good in any number of areas, and still be bad or sleazy in another area. We are all aware of religious leaders who while leading millions to Jesus still get caught with a harlot in a hotel room. This does not mean the man was wholly bad, he did still lead millions to Jesus, but it does mean that he was bad to the extent that - oh, yeah, he was caught with a hooker!
Likewise, there can be many great men and women out there who are good spouses, wonderful parents, stalwart church members, pillars of the community, love dogs, etc. But when they engage in MLM, then they are bad to that extent, and their goodness does change the bad of MLM scams any more than Jimmy Swaggart's goodness in speaking of Jesus changed the bad of his adultery.
This isn't High School. You can't take the "A-" of how great you are leading the Little League, the "A" of you providing for your family, the "A+" of church going and balance that against the "F" of ripping off people with MLM scams and come out with a "B-" average and call it good. That's not how life works.
Good people, even your friends, even your mommy, can succumb to drugs, to vices, to sins of all kinds. And yes, they can also succumb to get rich quick schemes. Who can't? We're all sinners, we all have our flaws and foibles, I don't write from some perfected level.
I'm a nice guy, and I have sins, flaws and foibles. Those you know may be nice, but they have sins, flaws and foibles, too. And if they're telling you that MLM is a wonderful opportunity, then that is one of their flaws. Because trying to scam others to make money is definitely a flaw. And while I'm not going to get into whether it's a sin, it certainly doesn't strike me as something Jesus would do.
Great. Glad to hear it.
I don't care.
This is like when someone talks about politicians and lists every bad characteristic that we all know that they all have, and then someone pipes up to share about their perfectly darling son who's a Town Councilman or State District Representative out in some Nowheresville area.
Then everyone is supposed to rush to assure her that, "Oh, of course, we just meant most are those things, we know some are great folks, heart of gold!" while inwardly thinking, "Whatever.".
I'm just the guy saying it out loud. Whatever. Politicians are in it for themselves, sorry if your cousin is one. And those who are making some bucks at MLM are scamming others to do so, at the least with the pushing of the not so valuable products, and more likely by the peddling of false hopes in trying to recruit them to their downline.
It's quite possible for a person to be good in any number of areas, and still be bad or sleazy in another area. We are all aware of religious leaders who while leading millions to Jesus still get caught with a harlot in a hotel room. This does not mean the man was wholly bad, he did still lead millions to Jesus, but it does mean that he was bad to the extent that - oh, yeah, he was caught with a hooker!
Likewise, there can be many great men and women out there who are good spouses, wonderful parents, stalwart church members, pillars of the community, love dogs, etc. But when they engage in MLM, then they are bad to that extent, and their goodness does change the bad of MLM scams any more than Jimmy Swaggart's goodness in speaking of Jesus changed the bad of his adultery.
This isn't High School. You can't take the "A-" of how great you are leading the Little League, the "A" of you providing for your family, the "A+" of church going and balance that against the "F" of ripping off people with MLM scams and come out with a "B-" average and call it good. That's not how life works.
Good people, even your friends, even your mommy, can succumb to drugs, to vices, to sins of all kinds. And yes, they can also succumb to get rich quick schemes. Who can't? We're all sinners, we all have our flaws and foibles, I don't write from some perfected level.
I'm a nice guy, and I have sins, flaws and foibles. Those you know may be nice, but they have sins, flaws and foibles, too. And if they're telling you that MLM is a wonderful opportunity, then that is one of their flaws. Because trying to scam others to make money is definitely a flaw. And while I'm not going to get into whether it's a sin, it certainly doesn't strike me as something Jesus would do.
MLM's 1%
Who are those who seem to make it work in the world of Multi-Level Marketing? The ones that your "boss" brings in to give you a pep talk, or the one who recruited you, or the one who is "the" Mary Kay or Avon or Amway representative in your area?
They're the 1%. Some even aren't so bad. Because that 1% is in two categories.
1. The first category are the scammers you're thinking. They built a thorough downline with bluff and no shame and yes, a lot of hustle. With them, it's not primarily about selling products, though they may well be living it thoroughly enough that they buy it all in bulk, use it themselves, and have all their family and friends and associates coming to them for all of it.
But mostly, and past any product sales, they are constantly on the move up in the first few levels of the pyramid that you are being asked to join at level 12+, and living the dream that all hope will be them, but few have any where near the charisma, lack of conscience and inside track to achieve.
It takes charisma, and I'd not fault a person for having that. The charisma is not just for the customers, not just for you in the downline. It's for those above, to let them recognize one of their own, and welcome him/her up eventually after they put in their time.
It takes that lack of conscience as they know how few can make it, and realistically already know that YOU won't. You're just the latest in a long line of suckers to them, to be roped in, used up, and tossed to the side. They know another will be born in a minute!
It also takes an inside track. That inside track might be who they already knew high up in the company. Or it might be their already high social position outside the company. But whichever it is, it is something that YOU do not have, but that you'd need in order to get where they are. It's what makes the football captain or head cheerleader who they are, when others on the team/squad are demonstrably better at it.
Just know - you are NOT going to get to where the guy with the diamond pinky ring and the Hawaiian vacations because you can "demonstrate" cutlery sets or towels well.
2. The second category involves those who have the social status outside the company already. And they are principally marketing that, plus their charisma, to get a lock on being "the" distributor among their set. Thus in every sewing circle, every ladies club, every church, there's usually one who is gone to for Avon or such.
The parties are like social events, and to not be invited is to be on the outs. So everyone dutifully buys, but most everyone knows that the stuff is hardly better than can be had at the store. Loyalty, and not wanting to admit they're being took advantage of, will have them swear by the product, like it's the best of the best of the best.
You will note that like in category one, YOU will not be able to do that, as you aren't in that social category. The plant foreman's wife might be up for this, the plant janitor's wife will not be. Even if the janitor's wife is the honestly better "sales person".
Because again, and always, with MLM, it's never really about the sales of the products. Even when it's mostly about the products, even when the category two person hardly ever tries to recruit a downline, it's still not really about the product.
The category two doesn't recruit because it's pointless to her, she already has a lock, and doesn't need competition, though if any insist, she'll dutifully go through the motions, relieved in advance that the upstart will fail. And the category two is really just using the products to have an extra level of status, as she can then claim "business woman" chops. Distinguishing herself from those who are "just" home makers.
And it's not like some can't be a bit of both categories. She can be Queen Bee of Avon in Podunkville and still dabble to various degrees in building a downline. If she does well enough, then it's hello to category one, guess she had little enough conscience after all!
But category one or category two, or bits of both, they are the 1%, at least for their little pond, and you aren't going to get to where they are. Certainly not by "hard work" or "salesmanship".
They're the 1%. Some even aren't so bad. Because that 1% is in two categories.
1. The first category are the scammers you're thinking. They built a thorough downline with bluff and no shame and yes, a lot of hustle. With them, it's not primarily about selling products, though they may well be living it thoroughly enough that they buy it all in bulk, use it themselves, and have all their family and friends and associates coming to them for all of it.
But mostly, and past any product sales, they are constantly on the move up in the first few levels of the pyramid that you are being asked to join at level 12+, and living the dream that all hope will be them, but few have any where near the charisma, lack of conscience and inside track to achieve.
It takes charisma, and I'd not fault a person for having that. The charisma is not just for the customers, not just for you in the downline. It's for those above, to let them recognize one of their own, and welcome him/her up eventually after they put in their time.
It takes that lack of conscience as they know how few can make it, and realistically already know that YOU won't. You're just the latest in a long line of suckers to them, to be roped in, used up, and tossed to the side. They know another will be born in a minute!
It also takes an inside track. That inside track might be who they already knew high up in the company. Or it might be their already high social position outside the company. But whichever it is, it is something that YOU do not have, but that you'd need in order to get where they are. It's what makes the football captain or head cheerleader who they are, when others on the team/squad are demonstrably better at it.
Just know - you are NOT going to get to where the guy with the diamond pinky ring and the Hawaiian vacations because you can "demonstrate" cutlery sets or towels well.
The parties are like social events, and to not be invited is to be on the outs. So everyone dutifully buys, but most everyone knows that the stuff is hardly better than can be had at the store. Loyalty, and not wanting to admit they're being took advantage of, will have them swear by the product, like it's the best of the best of the best.
You will note that like in category one, YOU will not be able to do that, as you aren't in that social category. The plant foreman's wife might be up for this, the plant janitor's wife will not be. Even if the janitor's wife is the honestly better "sales person".
Because again, and always, with MLM, it's never really about the sales of the products. Even when it's mostly about the products, even when the category two person hardly ever tries to recruit a downline, it's still not really about the product.
The category two doesn't recruit because it's pointless to her, she already has a lock, and doesn't need competition, though if any insist, she'll dutifully go through the motions, relieved in advance that the upstart will fail. And the category two is really just using the products to have an extra level of status, as she can then claim "business woman" chops. Distinguishing herself from those who are "just" home makers.
And it's not like some can't be a bit of both categories. She can be Queen Bee of Avon in Podunkville and still dabble to various degrees in building a downline. If she does well enough, then it's hello to category one, guess she had little enough conscience after all!
But category one or category two, or bits of both, they are the 1%, at least for their little pond, and you aren't going to get to where they are. Certainly not by "hard work" or "salesmanship".
The Secret of MLM
Against any advice I or your father or older brother or neighbor gave you, you're going to join a Multi-Level Marketing firm, because she told you that the only people who don't like it are those Who Don't Have What It Takes! But she's sure YOU do!
First, they already hyped you on all the money you'll be making. And while they'll tell you it's hard work, they'll make it seem like it's really very easy "hard work", as you'll "just" be demonstrating products and building your downline! And that just involves talking, and heck, you're already talking right now, you've got this down, huh?
When you agree, they'll make you aware of the small investment needed. Or kit fee. This will be something that by whatever name will involve you giving them money and them giving you permission to start.
Maybe it will be your initial $300 worth of products that they expect you to buy and then sell at a profit. Or maybe it will be a "sales kit" that will cost $100 or so. Sometimes they'll even "front" you the products, with you signing an agreement that if you don't sell them all within a certain amount of time, you will buy them.
Or sometimes they'll have you give them a deposit, far easier gave than got back.
However they describe it, please never lose sleep wondering if they'll profit off of you having joined. They will. They're the only ones likely to. You will not.
You'll next take their advice - oh, they may give you a goofy "training program" first, but I gloss that over, as it is not really important to them. They could care less how you do, it's not about how well you can sell. You'll see. So, as I was saying, you take their advice and go and "demonstrate" these great products to your family and friends.
Why them, first? They will say "for practice". But really because who else is going to buy average - at best - crap for more money than a store would charge? You guessed it. Only your folks who are just relieved you finally got a job, or your friends who wish to curry social favor with you or don't want to be rude.
Having done that, and probably made some sales, the company is well satisfied. They got their initial money from you one way or another, even if in the initial (and usually last) products you sold. And you may have referred someone who is ripe to become a recruit, so they may profit off of him, too. It hardly matters to them whether you continue now or not, they're good either way.
But you aren't. To get even that far, you had to have burned through every family and friend you had. That low-hanging fruit can't be picked again. Now you have to sell to strangers, and unsurprisingly, strangers don't care to pay too much money for stuff you can get cheaper at the store. You see now that the only way you'll make any money is to recruit some downline for yourself, and have them go sell to their family and friends...
....yep, that's the whole of it. That's the secret. That's how it works. That's how it keeps lurching along, from one sucker to the next. And how you, the person roped in to it by someone slick now find yourself slickly roping another person in to it. All you want at that point is to cut your losses.
You either succeed in at least minimizing losses and then quit...or you just up and quit as you can't persuade another to be the sucker you were. Either way, you're out.
True, some do stay in. Obviously the boss's boss did. But we'll discuss those special cases later, for they truly are the MLM industry's 1%.
First, they already hyped you on all the money you'll be making. And while they'll tell you it's hard work, they'll make it seem like it's really very easy "hard work", as you'll "just" be demonstrating products and building your downline! And that just involves talking, and heck, you're already talking right now, you've got this down, huh?
When you agree, they'll make you aware of the small investment needed. Or kit fee. This will be something that by whatever name will involve you giving them money and them giving you permission to start.
Maybe it will be your initial $300 worth of products that they expect you to buy and then sell at a profit. Or maybe it will be a "sales kit" that will cost $100 or so. Sometimes they'll even "front" you the products, with you signing an agreement that if you don't sell them all within a certain amount of time, you will buy them.
However they describe it, please never lose sleep wondering if they'll profit off of you having joined. They will. They're the only ones likely to. You will not.
You'll next take their advice - oh, they may give you a goofy "training program" first, but I gloss that over, as it is not really important to them. They could care less how you do, it's not about how well you can sell. You'll see. So, as I was saying, you take their advice and go and "demonstrate" these great products to your family and friends.
Why them, first? They will say "for practice". But really because who else is going to buy average - at best - crap for more money than a store would charge? You guessed it. Only your folks who are just relieved you finally got a job, or your friends who wish to curry social favor with you or don't want to be rude.
Having done that, and probably made some sales, the company is well satisfied. They got their initial money from you one way or another, even if in the initial (and usually last) products you sold. And you may have referred someone who is ripe to become a recruit, so they may profit off of him, too. It hardly matters to them whether you continue now or not, they're good either way.
But you aren't. To get even that far, you had to have burned through every family and friend you had. That low-hanging fruit can't be picked again. Now you have to sell to strangers, and unsurprisingly, strangers don't care to pay too much money for stuff you can get cheaper at the store. You see now that the only way you'll make any money is to recruit some downline for yourself, and have them go sell to their family and friends...
....yep, that's the whole of it. That's the secret. That's how it works. That's how it keeps lurching along, from one sucker to the next. And how you, the person roped in to it by someone slick now find yourself slickly roping another person in to it. All you want at that point is to cut your losses.
You either succeed in at least minimizing losses and then quit...or you just up and quit as you can't persuade another to be the sucker you were. Either way, you're out.
True, some do stay in. Obviously the boss's boss did. But we'll discuss those special cases later, for they truly are the MLM industry's 1%.
"Legitimate" MLMs?
Some insist that there can be such a thing as a "legitimate" Multi-Level Marketing company. And true, some can stretch some of the things MLMs do to what legitimate companies do to try to make it look like there's similarities.
I saw a joke picture of a pyramid with the CEO at top, the upper management next, then the middle management, then finally all the workers - and the newcomer was commenting, "No, thanks, looks like a pyramid scheme to me!"
But what makes a pyramid scheme a pyramid scheme is not that there is a hierarchy or more workers than managers. What makes it a pyramid scheme is when the worker's pay is not dependent on working, but on recruiting more "workers"!
While the law makers and lawyers will have you believe that there are some legit MLM companies, and that there are gray areas, the truth is, it is fairly simple to tell how bad they are.
1. Is it more profitable to recruit your downline than it is to sell the products?
2. Of 100 people who try this, are less than 10% having any kind of success?
3. Are clearly shill articles being wrote and posted online singing false praises about the company?
4. Does the company have to change it's name frequently to throw off consumer investigations?
5. Is the company reticent about giving it's name when they first talk to you?
6. Do they offer unrealistically high rates of pay for little or no experience?
7. Are the products readily available at stores already?
Any of these things can be indicators of a "non-legitimate MLM" or as I call them, "MLMs". When several or all factors are present, the sureness goes up.
For the first one, you can tell by the emphasis they put on building your downline. Or how you have to buy the products up front, or contract to get the products first. Examine how many products you'd have to sell to break even and start profiting...compared to how quickly you'd profit if you recruited others to sell instead.
For the second, good luck getting any admissions on this. Those working this are not really employees, so the company doesn't need to keep as thorough a record of them. And certainly your "boss" won't show you. But you can see if everyone seems "new" to this. You can get a feel for it. And their reaction to just you asking to speak to some who've done it for awhile will be revealing. Because past trotting out your upline boss's boss or some other higher up, they won't be able to show too many long term people in a business in which you're either rich or quit.
For the third, just google whatever name they finally give you. No Feed the Children International, no Save the Baby Seals, no orphanage for homeless cats will have the deluge of great and wonderful endorsements these MLMs supposedly have. But here's the thing to bear in mind - most all of them will be addressing the allegations that they are scams and pyramid schemes! Let that tell the tale. I grant that sometimes smoke exists without fire...just not too often. At the least - look deeper.
Fourthly, there are legitimate reasons for companies rebranding and/or renaming. But it happens more when there's been a lot of previous negative press. RJR Reynolds thus becomes Altria. Or Amway becomes Worldwide whatever this week. This makes you finding out how many times they've been sued or fined or sanctioned difficult. Pro-tip: If the company is less than five years old, but they speak like they've been around forever, there was probably a name change.
Fifthly, you've seen this ad where it loudly and brashly proclaims, "Internationally known wholesaler looking to expand into YOUR area!! Call now to get in on the ground floor!!!" If it's truly so well known, they'd say their name and you'd be like, "Oh, yeah, IBM!" But since their name is either tarnished, or newly changed, they can't give it to you at once, not till your emotionally invested in continuing.
Sixthly, what are they offering you - and for what? When it says, "$500 per week, no experience needed!" does that not indicate a red flag to you? "Starting at $17" when the prevailing wage in your area is closer to $9/hour? "I made $47,832 in my first three months!" Actually, if that last one strikes you as credible, then nothing I write will help you! Good luck on those condo time share sales!
Just know that no one wants to pay lots of money for no experience, because lots of money actually buys people who have a lot of experience! And if all the real salesmen passed on it - what does that tell you? Salesmen, real salesmen, go where the money is. If they're not already there, it's for them knowing it's lies. Hence the company now advertising for YOU!
Lastly, what are they selling? Some things are conducive to sales in a normal fashion. Cars and houses obviously can't be kept on store shelves. Other things like Security or Pest Control services, or even services in general may benefit by a sales staff going out and about.
But toothpaste? Dishrags? Vitamin supplements? Knife sets? What is this, the 1950s? They going to sell you an Encyclopedia set and a vacuum cleaner, too? Is their friend the Milkman and the Vegetable Pushcart vendor coming down the street next? All those things are found in stores, where they are mass produced in wonderful variety and priced to sell with only the usual mark up.
I am sure with razzle-dazzle and questionable charts and by buying in bulk and - most of all - becoming a downline distributor, you might, MIGHT, save a few bucks on some of this stuff. Might. I couldn't emphasize the "might" enough. But far more likely, the very amount of time, trouble, hassle and heartache in being a downline and building your own downline will make it impractical or uneconomical in the long run.
And probably in the short run, too. Just another good indicator that they are another out and out pyramid scheme with the products - average and over-priced at best - just being the legal cover.
I saw a joke picture of a pyramid with the CEO at top, the upper management next, then the middle management, then finally all the workers - and the newcomer was commenting, "No, thanks, looks like a pyramid scheme to me!"
But what makes a pyramid scheme a pyramid scheme is not that there is a hierarchy or more workers than managers. What makes it a pyramid scheme is when the worker's pay is not dependent on working, but on recruiting more "workers"!
While the law makers and lawyers will have you believe that there are some legit MLM companies, and that there are gray areas, the truth is, it is fairly simple to tell how bad they are.
1. Is it more profitable to recruit your downline than it is to sell the products?
2. Of 100 people who try this, are less than 10% having any kind of success?
3. Are clearly shill articles being wrote and posted online singing false praises about the company?
4. Does the company have to change it's name frequently to throw off consumer investigations?
5. Is the company reticent about giving it's name when they first talk to you?
6. Do they offer unrealistically high rates of pay for little or no experience?
7. Are the products readily available at stores already?
Any of these things can be indicators of a "non-legitimate MLM" or as I call them, "MLMs". When several or all factors are present, the sureness goes up.
For the first one, you can tell by the emphasis they put on building your downline. Or how you have to buy the products up front, or contract to get the products first. Examine how many products you'd have to sell to break even and start profiting...compared to how quickly you'd profit if you recruited others to sell instead.
For the second, good luck getting any admissions on this. Those working this are not really employees, so the company doesn't need to keep as thorough a record of them. And certainly your "boss" won't show you. But you can see if everyone seems "new" to this. You can get a feel for it. And their reaction to just you asking to speak to some who've done it for awhile will be revealing. Because past trotting out your upline boss's boss or some other higher up, they won't be able to show too many long term people in a business in which you're either rich or quit.
For the third, just google whatever name they finally give you. No Feed the Children International, no Save the Baby Seals, no orphanage for homeless cats will have the deluge of great and wonderful endorsements these MLMs supposedly have. But here's the thing to bear in mind - most all of them will be addressing the allegations that they are scams and pyramid schemes! Let that tell the tale. I grant that sometimes smoke exists without fire...just not too often. At the least - look deeper.
Fourthly, there are legitimate reasons for companies rebranding and/or renaming. But it happens more when there's been a lot of previous negative press. RJR Reynolds thus becomes Altria. Or Amway becomes Worldwide whatever this week. This makes you finding out how many times they've been sued or fined or sanctioned difficult. Pro-tip: If the company is less than five years old, but they speak like they've been around forever, there was probably a name change.
Fifthly, you've seen this ad where it loudly and brashly proclaims, "Internationally known wholesaler looking to expand into YOUR area!! Call now to get in on the ground floor!!!" If it's truly so well known, they'd say their name and you'd be like, "Oh, yeah, IBM!" But since their name is either tarnished, or newly changed, they can't give it to you at once, not till your emotionally invested in continuing.
Sixthly, what are they offering you - and for what? When it says, "$500 per week, no experience needed!" does that not indicate a red flag to you? "Starting at $17" when the prevailing wage in your area is closer to $9/hour? "I made $47,832 in my first three months!" Actually, if that last one strikes you as credible, then nothing I write will help you! Good luck on those condo time share sales!
Just know that no one wants to pay lots of money for no experience, because lots of money actually buys people who have a lot of experience! And if all the real salesmen passed on it - what does that tell you? Salesmen, real salesmen, go where the money is. If they're not already there, it's for them knowing it's lies. Hence the company now advertising for YOU!
Lastly, what are they selling? Some things are conducive to sales in a normal fashion. Cars and houses obviously can't be kept on store shelves. Other things like Security or Pest Control services, or even services in general may benefit by a sales staff going out and about.
But toothpaste? Dishrags? Vitamin supplements? Knife sets? What is this, the 1950s? They going to sell you an Encyclopedia set and a vacuum cleaner, too? Is their friend the Milkman and the Vegetable Pushcart vendor coming down the street next? All those things are found in stores, where they are mass produced in wonderful variety and priced to sell with only the usual mark up.
I am sure with razzle-dazzle and questionable charts and by buying in bulk and - most of all - becoming a downline distributor, you might, MIGHT, save a few bucks on some of this stuff. Might. I couldn't emphasize the "might" enough. But far more likely, the very amount of time, trouble, hassle and heartache in being a downline and building your own downline will make it impractical or uneconomical in the long run.
And probably in the short run, too. Just another good indicator that they are another out and out pyramid scheme with the products - average and over-priced at best - just being the legal cover.
Multi-Level Marketing
Everyone has heard of, and knows to avoid, "Pyramid Schemes". But what is Multi-Level Marketing or "MLM" and how is that like or unlike Pyramid Schemes?
First off, we must know how Pyramid Schemes work.
From Wikipedia: "A pyramid scheme is a business model that recruits members via a promise of payments or services for enrolling others into the scheme, rather than supplying investments or sale of products or services. As recruiting multiplies, recruiting becomes quickly impossible, and most members are unable to profit; as such, pyramid schemes are unsustainable and often illegal."
It becomes unsustainable very fast, as past a few levels, there aren't enough people to be recruited into this. 1 - 3 - 9 - 27 - 81 - 243 - 729, and you're usually the in the 729 group, the scam having been going on for a bit. True, the population of Earth is 7 billion, but this usually depends on knowing the person, and long before the numbers get "too big", you have the phenomena of people trying to recruit the same people.
So you and ten friends from the fitness club are recruited, and you each seek after three people...from the same gym! With everyone trying to recruit everyone, it soon collapses.
(Ponzi schemes are basically the same thing - pyramid schemes, but instead of each level recruiting the one below it, the originator is often the sole specific recruiter, with the other levels downline only "endorsing" or praising the originator.)
In Wikipedia, it interestingly goes on to say that some MLMs are classified as pyramid schemes. And yes, some are. But the truth is, they all qualify, and this article will explain why.
A Multi-Level Marketing company is the one that says, "We aren't asking people to simply send money upline and recruit others downline to send them money! Oh, no, we're selling a genuine product! Or whole line of products!"
And they are. The products range from "utterly worthless" to "average but over-priced", but sell them they do. At least they're there to be sold. So now instead of just asking three guys to send you money, and they to then recruit three a piece, etc., which is a "pyramid scheme", you are asking three guys to be your "downline sales staff" and they can then recruit three more "sales staff" a piece.
But since there's toothpaste or dishrags or make up or tupperware involved, it's all good. And regrettably, as far as the law is concerned, it is "all good".
Here's why it's not.
In the old timey "pyramid scheme" it was basically preying on men's greed, but all participants mostly knew it. They knew it would end sometime, they just were banking on it not ending in their time. This kind of thing has even gone on in modern times, when Bernie Madoff was doing his investment scams.
Many - not all, but many - knew that his rates of return were so high that it had to be a Ponzi scheme. But they were banking on being able to get in and get out before it blew up. And some did. Some who pretend that they knew nothing about nothing.
Others, some who were in the know, were unlucky. And most unlucky of all were those who not in the know, not realizing it was a scam, got completely took.
It is said that you cannot con an honest man, and that is often times true. But when some honest people see all the big people - who are presumed to know better - doing a thing, they figure, mostly wrongly, that it must be safe. So they invest the pension funds and the retirement savings. And they lose.
MLM works the same way. The cover of "selling products" has to be very well-developed to comply with the law. So since it is going to be well-developed anyway, they actually do go ahead with selling some products. Be it Amway or Herbalife or Norwex or Vector, you can actually get some products.
True, they usually make it so that it is much easier to get the products if you become a "distributor" or "representative" or "sales person" or such. But you can buy the products.
Some seeing this know that it's a scam, but figure they can get in, milk this a bit, and get out before it blows up. Why not, others have, right? So they put in their initial costs, which can be $100 to buy the "sales kit" or $200 to buy the products they'll sell, and then go big into it so as to get as many others in their downline as they can.
They quickly make back their investment and more, and get out (by simply going inactive) while all those they recruited later realize that there is no market for them to sell the crap in, as the person who recruited them already sold to everyone who wanted the crap - and recruited everyone who wanted to be recruited.
So those folks go inactive, too - but not with having got their money back, let alone their time and effort.
And this is why ALL Multi-Level Marketing "opportunities" are really pyramid schemes. Few, and I mean few, have had some normal career simply selling Amway products day in and day out, no recruiting, no scamming others, no building a downline.
And by "few" I mean "none".
Always the only money to be made is in recruitment. It's how you get your products cheaper, it's how you get your kits, it's how you get your investment back, it's how you do anything in that company. And that it is set up that way tells you all you need to know about the corporation's motives.
Corporations that are about selling products sell products. Companies that are simply pyramid schemes in disguise go on and on about downlines and recruiting.
First off, we must know how Pyramid Schemes work.
From Wikipedia: "A pyramid scheme is a business model that recruits members via a promise of payments or services for enrolling others into the scheme, rather than supplying investments or sale of products or services. As recruiting multiplies, recruiting becomes quickly impossible, and most members are unable to profit; as such, pyramid schemes are unsustainable and often illegal."
It becomes unsustainable very fast, as past a few levels, there aren't enough people to be recruited into this. 1 - 3 - 9 - 27 - 81 - 243 - 729, and you're usually the in the 729 group, the scam having been going on for a bit. True, the population of Earth is 7 billion, but this usually depends on knowing the person, and long before the numbers get "too big", you have the phenomena of people trying to recruit the same people.
So you and ten friends from the fitness club are recruited, and you each seek after three people...from the same gym! With everyone trying to recruit everyone, it soon collapses.
(Ponzi schemes are basically the same thing - pyramid schemes, but instead of each level recruiting the one below it, the originator is often the sole specific recruiter, with the other levels downline only "endorsing" or praising the originator.)
In Wikipedia, it interestingly goes on to say that some MLMs are classified as pyramid schemes. And yes, some are. But the truth is, they all qualify, and this article will explain why.
A Multi-Level Marketing company is the one that says, "We aren't asking people to simply send money upline and recruit others downline to send them money! Oh, no, we're selling a genuine product! Or whole line of products!"
And they are. The products range from "utterly worthless" to "average but over-priced", but sell them they do. At least they're there to be sold. So now instead of just asking three guys to send you money, and they to then recruit three a piece, etc., which is a "pyramid scheme", you are asking three guys to be your "downline sales staff" and they can then recruit three more "sales staff" a piece.
But since there's toothpaste or dishrags or make up or tupperware involved, it's all good. And regrettably, as far as the law is concerned, it is "all good".
Here's why it's not.
In the old timey "pyramid scheme" it was basically preying on men's greed, but all participants mostly knew it. They knew it would end sometime, they just were banking on it not ending in their time. This kind of thing has even gone on in modern times, when Bernie Madoff was doing his investment scams.
Many - not all, but many - knew that his rates of return were so high that it had to be a Ponzi scheme. But they were banking on being able to get in and get out before it blew up. And some did. Some who pretend that they knew nothing about nothing.
Others, some who were in the know, were unlucky. And most unlucky of all were those who not in the know, not realizing it was a scam, got completely took.
It is said that you cannot con an honest man, and that is often times true. But when some honest people see all the big people - who are presumed to know better - doing a thing, they figure, mostly wrongly, that it must be safe. So they invest the pension funds and the retirement savings. And they lose.
MLM works the same way. The cover of "selling products" has to be very well-developed to comply with the law. So since it is going to be well-developed anyway, they actually do go ahead with selling some products. Be it Amway or Herbalife or Norwex or Vector, you can actually get some products.
True, they usually make it so that it is much easier to get the products if you become a "distributor" or "representative" or "sales person" or such. But you can buy the products.
They quickly make back their investment and more, and get out (by simply going inactive) while all those they recruited later realize that there is no market for them to sell the crap in, as the person who recruited them already sold to everyone who wanted the crap - and recruited everyone who wanted to be recruited.
So those folks go inactive, too - but not with having got their money back, let alone their time and effort.
And this is why ALL Multi-Level Marketing "opportunities" are really pyramid schemes. Few, and I mean few, have had some normal career simply selling Amway products day in and day out, no recruiting, no scamming others, no building a downline.
And by "few" I mean "none".
Always the only money to be made is in recruitment. It's how you get your products cheaper, it's how you get your kits, it's how you get your investment back, it's how you do anything in that company. And that it is set up that way tells you all you need to know about the corporation's motives.
Corporations that are about selling products sell products. Companies that are simply pyramid schemes in disguise go on and on about downlines and recruiting.
ScamWatch
A few years ago, I was really into being one of the answer guys for answers.com. My particular focus was on answering the several thousand back logged questions in the now closed "Scam" section. The questions were always along the lines of, "Is Company X a scam?" or "Is this company a pyramid scheme?" and stuff like that.
But out of all the free offers of travel or lies about lottery wins and Nigerian princes, the ones that bothered me the most were the Multi-Level Marketing (MLM) ones. These are the ones offering "employment" and "sales opportunities" when there was no real employment and the only opportunity was to lose your own money.
These companies preyed upon the young, the ignorant, and "the both"! It can trick someone of any age, and yes, it can trick those of surprisingly high intelligence, especially if they've never seen or heard of the scam before.
The lengths these companies, and their shills, go to is beyond belief. They will create fake "Is this a scam?" sites, and then "investigate" Company X (which they'll assure you they have nothing to do with!) and then solemnly pronounce that while all the competing companies are pyramid schemes and Multi-Level Marketing scams, Company X is not, so go sign up now!
Eventually, Answers.com got overwhelmed by various MLM companies flooding them with "corrections" so as to get the "scam" category closed. And those same companies continue their tricks to this day, making sure that their own bought and paid for shills dominate the first page or three of any Google search you do on them.
They are confident that few will wade through all the crap and tricks they pull to get the scoop on them. And they're right. Few will.
But I'm one of the few.
On this new site, there will never be any "But having investigated, I'm pleased to report this one great company is NOT a scam!" No, this is ScamWatch, if you see their company name here, then it's a scam. And so you know in general?
If it's MLM it's a scam.
But out of all the free offers of travel or lies about lottery wins and Nigerian princes, the ones that bothered me the most were the Multi-Level Marketing (MLM) ones. These are the ones offering "employment" and "sales opportunities" when there was no real employment and the only opportunity was to lose your own money.
These companies preyed upon the young, the ignorant, and "the both"! It can trick someone of any age, and yes, it can trick those of surprisingly high intelligence, especially if they've never seen or heard of the scam before.
The lengths these companies, and their shills, go to is beyond belief. They will create fake "Is this a scam?" sites, and then "investigate" Company X (which they'll assure you they have nothing to do with!) and then solemnly pronounce that while all the competing companies are pyramid schemes and Multi-Level Marketing scams, Company X is not, so go sign up now!
Eventually, Answers.com got overwhelmed by various MLM companies flooding them with "corrections" so as to get the "scam" category closed. And those same companies continue their tricks to this day, making sure that their own bought and paid for shills dominate the first page or three of any Google search you do on them.
They are confident that few will wade through all the crap and tricks they pull to get the scoop on them. And they're right. Few will.
But I'm one of the few.
On this new site, there will never be any "But having investigated, I'm pleased to report this one great company is NOT a scam!" No, this is ScamWatch, if you see their company name here, then it's a scam. And so you know in general?
If it's MLM it's a scam.
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