There are literally thousands of articles all over the web on this very topic with convincing arguments on both sides. In fact both sides have valid points and the argument has really become objective, it completely depends on the motive of the individual writing article. Personally, I believe there are thousands of scams in the world and a small portion of those scams are definitely Pyramid or Ponzi Schemes. But are all MLM companies Pyramid Schemes? In other words, are all of the MLM companies out there SCAMS? When you put it like that you begin to see the idiocy of that thought. Of course not! If they were the FTC would have shut them down years ago! Are there pyramid schemes posing as legitimate companies in order to SCAM people out of their money? Absolutely!
You see, there are thousands of MLM companies out there using the dreaded "MLM Pyramid". Some have been around for a very long time and are time tested and proven. Others are just beginning and offer the chance (for those willing to take the risk), of great reward for those who get in at the beginning and ride the wave to the top. Then there are those that start up and fail within a year. Sound like anything familiar? Doesn't this sound just like traditional business, franchise opportunities, or the stock market? The truth is if you asked any large company to draw out the proper chain of command within the organization it would resemble a "MLM pyramid". Now maybe they would be crafty and try to use long lines and turn it on its side but it would still resemble a "MLM pyramid". The concept is simple; a business is built on a structure so that systems within the business will work. It just so happens that the pyramid is based on the strongest geometric shape in the world, the triangle. So then, do multi level marketing companies use compensation plans that resemble pyramids? Yes, of course they do. Again, if there is no structure there can be no system, if there is no system, failure is imminent.
Now, if there are good MLM companies out there (and yes they would be using the "MLM Pyramid") with a few bad apples in the mix, how do you tell if the company is a scam or not? This is where YOU come in. Research the company thoroughly and make sure you research all of the comapanies prinicpal partners. Do they have any judgments against them? Have they been involved in a scam before? Is the company solvent? What is their debt load? Then, you have to look at their product or service. Does it fill a need in the market place? Would you buy the product or service? Do you believe in the product or service? This is important, because if you don't believe in it no one else will believe you. If there is no product or service being offered, there is no business and you should stay away. One last point, do not join a company just because your buddy, Billy Joe Jabber Jaw says it's a great company. It may be for him but it may not be a good fit for you.
Where does all of the negative hype come from then? Well you see in the business world we have an application process where we match up a person's skill set with the job we expect them to do. Then we plug them into a system and hone there skills to better serve the need of the company. If they don't succeed within the system we will generally move on (let them go) and find someone that can. In most MLM companies all you need to join is an address, a date of birth, a social security number and a few hundred bucks. There is no experience, education, or skill set required. A lot of people that sign up in an MLM have no business being in business and really only signed up to get a discount on the products. Or, their buddy Billy Joe Jabber Jaw told them they would make millions if they just signed up now and "secured" their spot. Then what happens is at some point right after they sign up as a new distributor they decide that their "gonna do this thing". They pick up the phone, call one, or maybe even 5 of their family members they wrote down on their top 100 list and get told NO. WHAAA, tear, tear..and the rest is history. At this point they start thinking they have been scammed out of hundreds of dollars, generally ignoring the product or services they just purchased and consumed for there own use and it has to by that darn MLM pyramid scheme.
So here's the scoop. A business opportunity, MLM or otherwise, is just that, an opportunity. You have a choice to either take advantage of it or not. Never go blindly into any opportunity. Don't just take your buddies word for it, do your own research. Then make a decision and stand behind YOUR decision. If you feel it's not at all for you, don't do it. I can not tell you how many opportunities I have been offered in my life that I said "no" to. Some of those decisions were good ones and some were not, but they were my decisions, no one else's.
