Originally posted by Shadus
There's a lot of black sheeps in MLM. But I feel we need to look at things in perspective.
NB: I myself am skeptical of all MLM companies, but in all fairness here goes:-
If (and its a big 'if'), you start a company and have a good product A. And you wish to promote and distribute your product. There are actually 2 major methods to do that
In the traditional method, it goes something like this (roughly)
Manufacturer -> Global distributor -> Regional distributor -> local distributor -> Promoter -> Consumers
Add to the profit each level makes, you got to pump in money for advistisment, marketing effort, extra warehouse stock level so that product will always hv stock etc, and of coz, R&D cost
In the MLM method of distribution its goes something like this
Manufactuer -> Team of sales person -> consumer
The team of sales person is where the MLM schemes come in. Usually, advistisement and marketing effort is cut to minimum. Most of the cost involved is in paying the "pyramid structure" as most pple would put it.
MLM is rather the norm in US. There are some big name products that are distributed in such a manner. In singapore, it is still viewed with much skeptism as there are many black sheeps around. (ie, they're not true manufacturers, but just bulk buyers and then they establish a so-call MLM company already).
So next time u run into a MLM promoter, stop and do a quick evaluation of whether its worth the time. The simplest test is to look at the product first and see if u like wht u are seeing. Black sheep MLM really dislike pple trying to know more about their products. A genuine MLM company is one where it trys to make u a loyal consumer first. (This way of distribution works thru building loyal customers since advertisement and marketing is minimal). If u dun see anything of this sort, its probably anr get-rich scheme.
My pt being, pyramid selling itself is not an evil. Its just a different way of distribution.