This seems to be the year of people selling MLM products coming out of the woodwork trying to sell me products as part of a multi-level marketing business (or MLM for short). MLM is a form of direct selling. Those involved generally have two revenue streams, those that are created on their own as well as another stream created by recruiting people to join the “team” under them to sell. So not only is the person trying to build their personal business through sales of a company’s products, but they also focus on bringing on more people to work and sell under them. While this is a great way for people to make money, it’s not one that I personally find credible. I personally look at them as pyramid schemes which some companies have been sued over in the past and have had some heavy fines slapped against them.
*The following are my opinions based off of interactions with people selling MLM products from different MLM businesses that tried to “recruit me” as well as my own research.
People selling MLM products are independent contractors (for the most part, I’m sure there may be some exceptions), and therefore are not direct employees of the company they are selling and recruiting for. Many of the people suckered into MLM business never make anywhere near what they were told they “could” make. The people who make all the money are the guys on the top of the pyramid. Those underneath make very little in the grand scheme of things for their efforts.
The FTC isn’t holding back on MLM and pyramid scheme businesses
Many people consider MLM businesses pyramid schemes similar to my point of view even if the MLM business is considered “legal”. The FTC made a statement where they said, “Steer clear of multilevel marketing plans that pay commissions for recruiting new distributors. They’re actually illegal pyramid schemes. Why is pyramiding dangerous? Because plans that pay commissions for recruiting new distributors inevitably collapse when no new distributors can be recruited. And when a plan collapses, most people—except perhaps those at the very top of the pyramid—end up empty-handed. Not all multi-level marketing plans are legitimate. Some are pyramid schemes. It’s best not to get involved in plans where the money you make is based primarily on the number of distributors you recruit and your sales to them, rather than on your sales to people outside the plan who intend to use the products.”
“I have a great opportunity I’d like to share with you…”
That’s the usual BS statement people selling MLM products make to kick off their scripted elevator sales pitch. They tell you how great it has been for them (they’re lying) and how much money you could make (which you won’t make much). They tell you it’s a business you can work on in your spare time—which means no one really takes their business serious enough to want to be successful. The truly gullible are the ones to normally fall for this trap and then they get suckered into being someone’s lackey to go make sales.
If they don’t think you’re smart enough to sell under them, you won’t see anything mentioned above, all they will ask you is if you’re interested in purchasing their product. They will email or message you a bunch of information that they don’t have a clue about in hopes that you bite and don’t ask any questions. Again, the gullible and uneducated will be the ones opening up their wallets.
I’m going to use the term “salesmen” loosely as it could be either gender reaching out to you. Regardless if they want you to come on board or purchase the product, the following will likely be the case (this is where I like to mess with them). Full disclosure, I was in the supplement industry for over 10 years, I know the ins and the outs as well as what to look for, ask about, and question. Those who don’t live the industry, won’t know the answer to any of the questions I would ask them. And those who would answer, it was scripted and worked around my question or they flat out lied and I knew they had no idea what they were talking about.
So here goes… Every single individual who has reached out to me about their MLM business has been completely clueless about what they were selling. In general, people selling MLM products have no background, degrees, or certifications to sell the products they are pushing. In fact, some of people selling MLM products have no educational background at all other than graduating high school. Not only do these people selling MLM products not understand their product (which was terrible), but they had no clue how to sell.
Let me give you an example that happened to me just last week. I worked at a gym when I was in college. One of the trainers/fitness instructors there who I worked with quit just a couple years ago, and recently started selling products from one of these MLM businesses (I’m not going to name drop as it’s irrelevant). She reached out to me and asked if I’d like to hear more about her business since she knew I was in the supplement industry a good part of my career. She said I’d be a perfect fit and could make a ton of money if I came on board. What she really meant to say was, I’d come on board and make her a ton of money because she has no idea what she’s doing. I’m more than familiar with the MLM product line she was pushing and happen to completely hate every product they sell, as well as their business model. So, I explained to her that I wasn’t interested. Yet, she decided she wanted to keep pursuing. Finally, after being polite, I picked apart her business and the products. By the end of it, she was so embarrassed that she removed me as a friend on Facebook. I’d say my feelings were hurt that she un-friended me, but seriously, it’s Facebook—my life will go on.
It’s as if these people were plucked out of thin air and thrown into the MLM program. They were suckered into this MLM program and were sent off on their own to figure it out, or guided with a terrible mentor. They don’t love or live for what they do, they’re simply trying to make a quick buck because they were told how easy it is to sell these products to people and to get them on board as a part of their pyramid scheme… err, I mean business. Not only will they eventually find out they aren’t making anything near what they were told, they will eventually hate what they do and quit. Trust me, I see it happen all the time.
What’s the take home?
If people selling MLM products reaches out to you, pass on everything they say. In fact, RUN! And don’t stop because they will follow you. Most of them are playing the numbers game. If they reach out to 1,000 and only 1% bite and do as they ask, they figure that’s 10 people they got on board or who purchased. So, then they reach out to another 1,000 by spamming their email or through messaging on social media. The cycle continues. But here’s the real kicker. Once people try the over-priced garbage that they call a product, they’re never a repeat buyer. They see through the smoke and mirrors and realize they were just ripped off and ultimately scammed (sometimes by someone they know—a friend or family member). Nice, right? So, here’s my suggestion for you. If you don’t know the industry, then don’t go the route I did about digging into the business and product line, rather, politely decline their offer and move on. Don’t look back and don’t wonder if it’ll really work as they said. Your sanity and wallet will thank me.