Read this before joining MLM
MLM here stands for multi-level marketing. Other names are direct
selling, network marketing and home-based franchising. The bad one is
called pyramid, get-rich-quick, Ponzi
or snowball scheme. There is just a thin line between MLM and pyramid
scheme. Pyramid scheme is often cultic (Confuse and Conquer) and puts
active recruiters’ reputation at stake. While the members lurk around
for prey, they are victims themselves too. If someone whose view you
value tells you such ‘business opportunity’ you may want to join, it is
better that you understand MLM first.
The reality of MLM (that they do not tell you)
The system encourages
a) recruitment of friends and relatives to consume products or
b) sale of products to friends and relatives, usually without them asking for it.
The encouragement is done via frequent motivational meeting and
seminar. The meeting is paid by every member attending it regardless of
the MLM income amount. Such pep talk meetings plant the belief
subconsciously. In layman term, you pay to be brainwashed /
MLM-programmed.
Wealth and materialism is widely used in the
propaganda. That is the only way they use to attract people although
they tell you that is not true, people are attracted by the products
etc. An example is showing the villas that belong to a few people on
top of the system as if everybody can achieve that state. And there is
a fleet of big expensive cars usually in same color maneuvering into
the seminar location. Also people applaud and whistle (they want you to
do the same thing too) when someone gives testimony that he has earned
big in a very short period of time. I personally feel a little sick to
see all these materialistic behaviors. If it sounds too good to be
true, most probably it is not. There is always a catch. It is just a
fad to get you jacked up. Note that nothing will happen when you go
home right after the temporary ecstasy in the seminar. When your friend
in MLM is getting too hyped up, you should mildly remind him that his
MLM company is not the best thing on earth. Even I before this tried to
believe it from time to time due to the charismatic propaganda.
We cannot do MLM if we have clear mind. MLM can only be carried out
with a certain degree of unconsciousness or even delusion, mainly due
to the crowd psychological effect. Most common sense things are briefly
gone thru except some buzzwords. Have your MLM friends told you that
their system looks like an INVERTED pyramid instead of a pyramid? And
Mr. Gates’ company is already linked to MLM and in future EVERY
business will be running MLM? And Mr. TRUMP will join MLM after he is
broke? For me Donald means: (1) MLM is for people who are broke. (2) He
will not join MLM (him being broke = sunrise in the west). (3) He will
own an MLM company instead to let you and others work for his. By the
way what makes him rich? I cannot remember it is MLM.
The
income is from the lower levels of the system. From financial point of
view I personally think that the company sees the payment to the people
at high ranking as advertisement fee. Those hotshots are walking
advertisement that attracts new downlines. There are a few members who
are extolled by other members to be renowned VIPs (in business suit
even on hot day) that non-members and new members will regretfully miss
meeting with. In the meeting the upline wants you to wear smart, to be
on time and to switch off the cellphone (he turns off his too). Then
the upline brings you to approach that ‘VIP’. The upline will make
notes on what the ‘VIP’ say. After the meeting, the upline still
continues to praise him or her. All these are to build up your feeling
of respect so that you will take whatever that ‘VIP’ says. I consider
this idolatry. For me, most of those VIPs are snobs.
The reasons the company uses MLM to sell the product:
a) The product is often claimed to be unbelievably or mythically
beneficial, for example cancer cure. Hyperbole. And it is overpriced.
The product is probably good and sellable in open market but they can
only sell it at market price in the open market. If they use MLM, their
product can be sold at brainwashed price without price competition in
open market. And they tell you their product is cheap because middleman
is eliminated.
b) To save transport cost that is needed to
distribute the products to the retail shops. In MLM, the members go
pick up the products themselves.
c) To save cost of salary to hire people to do product service.
The mindset in consuming the products is different from the ordinary
one. There is a motive when consuming the products: so that you can
influence others to consume the products too. With motive coming in,
colleagues become prospects and the workplace becomes a market. Even
friendliness has hidden agenda that can make a nerd become a social
animal. Anyway they will not spend time on a friend who is not a
prospect to the point that they may counter ask "Will you join me if I
answer all your questions?". Community is degraded.
When you
run out of the product you are using, you cannot pick it up anytime
like buying things from the local shop. The product has to be purchased
from the warehouse and a minimum amount of purchase is required. The
warehouse is only open during office hours and you have to get the
queue ticket. Even if your upline keeps some inventory, you still
cannot walk into his house anytime to get the product like you can by
walking into a shop.
If you have work experience in a
corporate company, you can do MLM. But on the contrary if you have
experience in MLM, you cannot work in a corporate company.
If people that the society needs (for example farmers and paramedics) join MLM, the society will be in chaos.
MLM does not require you to have special skill, to be young, to be
strong or to be highly educated, but just requires you to have
a) purchasing power
b) friends
c) perseverance (in other word, cheekiness)
In fact, there is a secret system in place to push up for example a few
doctors, disabled citizens and senior citizens for publicity purpose.
If you are just a normal person, it is going to be harder for you.
To become a member there is a fee for the cost of the starter kit and
monthly publication. You cannot join the system if you have no money at
all. That means it is only suitable for people who already have income.
The system suggests the possibility of wealth but there is nothing to
make you survive your daily life in the beginning. This is different
from being employed where no wealth is suggested but you have a steady
pay check to live on.
The company may call you a business
owner. But are you setting the company policy? Are you handling the
public relation? Are you facilitating the supply chain? Do you forecast
market capacity and manufacture the product in an acceptable quantity?
Will ALL the profits go to you? When you consume a product, you are
helping your upline’s uplines whom you may not even know (even if you
know them, they do not know you). I think you are more like a donator
in MLM. Perhaps MLM is not for selfish people after all, hehe. For me
if I want to join it, I will want to be attached directly to the
company because I want to modify my own system. Of course they shall
not allow this to happen although they call it a franchise. Is it not
that franchise is supposed to connect directly to the company?
Your upline will want you to decline even the not-so-often invitation
to other social activity if it clashes with the regular MLM meeting.
This is because they are afraid that you are deprogrammed.
It
is well-known that they are not time-conscious. Their ‘one hour’ is
actually two hours. Punctuality is always compromised. It is quite
amazing to me that EVERY MLM has this ‘timeless’ culture.
If
a member wants to distribute product catalogue, he or she has to bear
the cost of the catalogue. Isn’t it absurd that you pay for their
marketing material in order for you to market their product?
I feel uncomfortable to be talked into buying or joining something
because even when I do not like the conversation I feel it is impolite
to just jam it. I think ad or brochure works on me because it does not
give me pressure as I can stop reading it anytime. Also I like to be
surrounded with goods that I can take my time to check and pick my
choice. Is anybody not like me?
MLM is usually a sensitive
topic and you cannot talk about it in a formal occasion. Most of your
friends will run away from you if you are an enthusiastic MLM member
that talks about MLM all the time. They will not even picking up your
call. It is even worse if you think that being straightforward does not
work and you start masking what you say. Your friends will detect that
manipulative act. I always ‘talk’ about MLM too, but my friends do not
avoid me.
MLM motivates members to aim for ideal duplication.
Let’s say a company recruits 5 members in a month, then the 5 recruit
25 in the next month, 25 recruit 125 in the month after and so on, then
after one year 244,140,625, equivalent to the population size of a
country, will be in the MLM and there will be no further market for the
members in the lower level in that country. When you tell them this
figure, they will say that the real duplication will not be ideal. This
is in conflict with what they aim for. So they already know that it is
not going to be ideal and even it is ideal it is not economically good
but they still aim for the ideal? This makes me bewildered just to
reason it. No matter they can duplicate (or clone) ideally or not, only
a few members will succeed. "Many Lose Money".
The sidelines are basically your competitor and will not help you in
anything because they have their own downline to take care of. The
lower the layer you are in, the more competitors you have. Let’s say
the first layer has five people. If you are at the first layer, you
need to compete with other four to get new members. If you are at the
12th layer, you will have 244,140,624 competitors! Of course they will
not tell you which level you are in. Sidelines do indirectly help each
other:
a) when attending a huge rally: the scene of big crowd of people will be a powerful brainwasher for newcomers.
b) by letting newcomers know them. The more members that the newcomers know, the stronger the sense of belonging to the group.
As you can see above, MLM does not even consider about market
saturation. Genuine franchise companies will do market analysis for a
town that already has their franchise outlet when they receive a new
franchise application. If they know that the market in the town is
already saturated, then will reject the application. Two McDonald
restaurants in a small town will finally die together.
I personally see that there are three groups of members in the system:
a) members who pay for the product they consume
b) members who need not pay for the product they consume (the income is enough the cover the price of the product)
c) succeeded members whom the company has to pay handsomely
If members can succeed so easily, the company will die. The system is
closely observed and delicately tweaked so that the ratio of b and c
is minimum (but of course greater than zero, haha). Although the more
people joining and staying in the system, the more people will be
eligible to be in higher position but that also means that you need to
compete with more members and you has to be extra hardworking to stand
out. It is worse if the number of people in the system does not
increase because that means nobody will have chance to go up at all due
to the stagnant number of available positions.
When someone
joins MLM, I can say that his or her whole family joins MLM because
that family will no longer be open to deal with outsiders in MLM. So if
every family joins MLM, the last family that joins in will not have the
opportunity to earn money because there is no MLM-free family outside
anymore. Everyone on the street (including kids who will grow up one
day) will rather want to deal with his or her own family member in MLM.
There are new MLM companies coming out every year. Despite of the
uncertain future of a new company, they assert that they have big space
for growth compared to existing MLM companies and they invite you to
grow with them as pioneers. And everyone of them will say that their
MLM is different. Yeah, right.
How pyramid schemes usually exploit loophole in the law to be stamped as a legitimate MLM:
a) Create a phantom company that acts as a simple and unsuspicious
middleman to deal with the local authority. This phantom company can be
closed down anytime by the pyramid scheme.
b) Sell goods only to
uplines and let uplines deal with downlines. From legal point of view
it is just a simple trading with uplines and there seems to be nothing
wrong. In other words, the company is not liable with the deal (so
called franchise) between uplines and downlines.
…
Regardless of the common undesirability that exists even in legitimate
MLM, if you do succeed in the system, you may earn a decent living (but
do not think about the villa or sports car) as long as the company
stands. The work pressure becomes lesser with ranking raise (with solid
foundation), which is different from corporate world where the work
pressure becomes greater with career advancement. But it is not going
to be quick and easy in the beginning. And it is pretty hard for an
individual to determine whether an MLM company is legal or not. Even
the authority can make a mistake in stamping the legality or the
company knows to utilize the loophole in law. And even the company is
legal, it does not mean it operates ethically (wealth should come from
value). If reading until this point you still really want to join an
MLM company, I have criteria that an individual can scrutinize against
for both existing and new MLM companies to see if there is something
fishy about them.
Company criteria
They will fully
refund the fee for the starter kit quickly if you want to pull out
anytime. And the price of the starter kit is not expensive.
The product
a) is of the the type that you are using. It just has different brand.
Nobody likes to be persuaded into using product that he or she is
currently not using.
b) is researched and produced by the company
itself. It is not selling other other company’s product. The product is
unique and cannot be bought somewhere else.
c) has full and QUICK money-back guarantee. Some can refund but you have to wait for a very long time.
d) must pass your own verification with the mentioned accreditation
body (for example by checking in the official website of the body) if
the product is claimed to have certain award or certification.
e)
is not claimed to appreciate overtime or to be able to be speculated.
You will discover that they do not want to buy it if you remise it.
The sales point will not accumulate. This is to ensure that you have a
network that has solid foundation before you move up a ranking. It is
meaningless to move up the ranking from the accumulated points of just
using the product yourself alone. Such ranking is just a name.
The company is listed in stock exchange. That minimizes the chance that it is an illegal company.
Network criteria
The reason I write these criteria in addition to the company criteria
is individual network under the same company may work differently. Some
networks operate like a pyramid scheme although the company is not a
pyramid.
You are not duped into their meeting. Something like
they do not tell you beforehand what company organizes the meeting.
False pretexts.
They do not tell that you do not have to sell
anything. For me even getting people to self-use the product is a type
of selling too. They should not twist this around.
Before you
sign up, they do not ask you to keep it a secret. Pyramid scheme
definitely does not want a potential prospect to consult friends and
family on the matter of signing up.
It does not suggest to
you to give them big money. Something is just not right if someone says
you give big money to the company and you will earn money. They may say
that it is an investment but it is not. Of course starting a business
needs fund but it is not the same with MLM because nobody persuades you
to start it and you yourself scout around to pay the relevant parties
to facilitate the business.
The system does not suggest any
option of stocking up products (for the purpose of moving up a rank
etc). You buy only when you need it. From economy point of view, if
everyone stocks up product, the market will become saturated and the
price of the product will decrease. Decent system will focus on natural
repetitive sale.
They do not have college students. College
students are young people whose judgment is still not strong and easily
influenced. So young people can bring in more young people. If they
have many college students you can say that there is something wrong
with the system and they cannot pull older people with better judgment
along. Plus it is an ethical issue to get students into MLM as it
distracts their study.
It does not have so-called time-limited
offer which urges you to sign up quickly, say on that day itself. Take
note that signing up does not mean you can get big money in return
straightaway.
It does not ask you to make risky change of
lifestyle for example stopping monthly loan payment, quitting your job,
buying luxurious stuff (to dupe prospects that you are doing well with
MLM) or borrowing money (even from loan shark) to ‘invest’ in it. And
it does not make you occupied that you lose your job. For example they
may purposely have meeting until midnight (MLM: Marketing in Late Midnight
or in Malay language "Meniaga Larut Malam") that you do not have enough
sleep and your work performance the next day goes down. Or they want
you to talk about them to your colleagues during work time.
They do not suggest you to stay away from Internet search engine except
their website. Pyramid scheme is extensively exposed and discussed in
the Internet.
The system for the lowest level should be in
such a way that even if you do not move up a level, you will not lose
anything but just consume the product that you need anyway accordingly.
They must not suggest to you on buying books, audio/video material and
seminar seat from them. I personally see that new members are asset to
the system so they should be well taken care of, not be sucked dry.
So, basically the difference between pyramid scheme and MLM is pyramid
scheme will urge you to take out big money from your pocket (to buy in
big inventory etc) but MLM will want you to use their products as
needed (of course the more the merrier). And the basic similarity
between them is both of them will want you to pitch the people you know
to do the same thing you do.
…
If you are already an active member who has recruited many friends,
even though after reading this article you feel you are in the wrong
boat (in terms of company, system or MLM itself), MLM is designed so
that you cannot just jump out due to self-esteem since you have
proclaimed to many friends that it is good.
This is copied from this link:
Read this before joining MLM
Related links will be found in this URL:
Prudence and Madness’ New Recruitment Strategies by Companies
How To Detect Misrepresentation in Jobs by Dine Racoma
The Sunday Phone Call by Maki Eduardo
What’re They Up To?, Scam? and Questionable Methods by BA Racoma
The Networking Rant by Ana
15F Octagon Building by Celeni
Recruitment Strategy? Beware and Be Aware! by Shari
Just
want to share some of experiences guys. I, myself, learned how this
business works long time ago and they are all legitimate, as they said
so. So, don’t judge us that we don’t know anything that we are saying
here. We learned our lessons and we will not do the same mistakes
again. Once is enough, twice is too much, but thrice is not a joke
anymore. Like you said, you are not forcing us to join your company.
So, please stop making those annoying calls. We are not against the
business, we just don’t like the method of recruitment being employed
by some of its members. Read carefully the URLs I posted above and we
are telling the same problems about that method and some other
thingamajigs. Take this suggestions as a way of improving your company.
Good luck in your business! Peace out! (Maganda naman yung business na
yan. Nasubukan ko na din yan eh. Magpainom na lang kayo kapag yumaman
na kayo! Tama ba yun guys?! Hahaha…)
And hey, the blogosphere was created to open out the opinions of the society.
The internet is a massive free storage of ideas, right? So, no hard feelings!
