Multi-Level Marketing (MLM)

[runaway]

im still skeptical about this mlm company. or rather all mlm companies. im not sure if i can do it. recruiting people to become my downlines, using the products, selling the products, etc. it seems hardwork. but i guess, i'll give it a try.

o 0 (4cc? power? herherz)

[brownpau]

There's a thread on MLM's at http://www.pinoyexchange.com/forums/...threadid=10684 .

I have several problems with how MLM's work. Basically, I think it's patently dishonest to charge several times the actual price for a product to pay for your upline's income. Something is wrong when the real profit comes from recruiting people rather than from selling a good product.

There's also a culture associated with MLM's that disturbs me. People I know who seriously get into network marketing are taken over by it; their lives revolve around the business. There's so much enthusiastic materialism it's almost cultish, very defensive, and more than a bit unnerving. Just attend any seminar, and you'll see what I mean.

Take a look at http://www.vandruff.com/mlm.html for a holistic critique of multi-level-marketing.

[bagyoboy]

I did a little research, and I transcribed a video presentation of Dr. Charles King, a Harvard University graduate and a professor of marketing at University of Illinois, and a consultant for large businesses in the US. Harvard University and University of Illinois are teaching network marketing, and so are AIM, UP, Ateneo, and DLSU business schools(I think).

With all the "hype" out there, you might recognize a professional business model when you see one.

Just visit this site:

Network Marketing

Hope it will be educational.

[zimdude]

Any new thoughts here? Well I'm not into sales of any form myself, pero nakakalula to think how much these people earn sa kanilang mga kuwento (haven't been to these myself though)... wow parang the work I do earns so little in comparison. About the not-working-for-a-boss bit, I don't mind working for a boss

So it makes me reflect upon my career path.

[battleangel]

i've been wondering about this too. right after college, i saw an ad that mentioned a technical/marketing position with good compensation. curious, i went with some friends. it turned out that they were selling this computer (i forgot the brand already) with all the packages at an absurdly high price. even with the peripherals, i knew that the product would be hard to sell with its price. also, the salary mentioned was not the "real" salary; only a measly amount of that would be the basic salary and the rest was how much you could earn as commission. from that i could sense that they were trying to deceive applicants. and they did, because i saw people from Ateneo, La Salle and UP lining up in business suits, thinking they'd be earning that much.

but i decided to attend the seminar, anyway, since i was there already. what bothered me was this lecture on how to "manipulate" people into buying the product. the speaker mentioned stuff like spotting targets right away, and knowing what it would take to convince them to buy the stuff. it concentrated more on convincing people to buy the product, and not how marketable and viable the product really was. i was listening and even i was not convinced about the product. i mean, even if i had the money i don't think that i would have bought the product anyway. so i left.

call me too idealistic but if i don't believe in a product, why would i sell it? the true measure of a product is that it should sell itself, and people would be willing to buy it even if it wasn't aggressively marketed to them. is it as "revolutionary" as it claims it is? is it worth its price? will it really make people's lives easier/better as it claims? what's the difference between this product and all the products in the market? would you buy the product if you had other choices?

for the others, please don't be offended, i'm only relating my experience. i'm not totally discounting this kind of profession. in fact, in the future, i would like to be able to create and market a product that i really believe would satisfy the needs of some people.

[benjiep]

Hey battleangel,

very right there should be a product. For everyone's benefit, here's the UK FAQ on true MLM vs. Pyramid schemes:


SECRETS OF THE PYRAMIDS, AND OTHER ANCIENT SCAMS

Pyramid scams, pyramid selling and MLM ( Multi Level Marketing ) schemes are the subject of much public confusion, to the financial gain of a few con men and the loss of many ordinary people.

First of all Multi Level Marketing, or MLM. You need to understand how a genuine MLM works in order to clearly see how the pyramid version is a scam.

Multi Level Marketing is a perfectly valid and effective way of distributing product to the end user, just as is direct mail, off the page, and even , through shops.

Read that again. The key words are "distribution", "product", and "end user". End users are customers, but, as we shall see, in the con game, not all customers are end users. An end user is someone who wants the product or service purely as a USER. He is SPENDING MONEY WITHOUT HOPE OF FINANCIAL GAIN. He is the most important part of any genuine business. This is the very simple point that scam artists hope that you do not understand.

The difference between a genuine Multi Level Marketing business opportunity and a scam is that the MLM scheme has END USERS. People who ACTUALLY BUY THE PRODUCT. In any genuine scheme you should only be asking yourself one question " can I sell this, at the price being asked". It is like any other business. There is a product, there needs to be buyers. Given that you can sell the product you can make a margin.

It you think that the product is over priced, forget it, the business will not work for you, no matter what the margins or downlines. If you personally don't think you know people who will buy the product, forget it. But if you like the product, would use it yourself, and think the price fair, then perhaps there is a business.

Only then do you look at the business plan. This will show that the more people in your organisation the better your profits. But these profits are derived from ACTUAL SALES. No sales, no profit. Do not underestimate how hard it is to build and maintain an organisation of 50 people selling £250 per month each, ( which, in most respectable MLM companies would make you £1000 -£2000pm personal income). It is a time intensive people business requiring great innate organisational and admin. skills. It is also true that many ordinary people who get involved in MLM find that they have these skills, which they had never before suspected, and they make money.

It is worth noting that most genuine MLM schemes are restricted to products where the normal distribution system ( factory to agent to importer to agent to wholesaler to shop ) builds up very high margins, and where there is scope for repeat orders.

Prime areas include diet and health related products, perfumes , cosmetics and jewellery. The MLM company avoids the normal advertising and marketing overhead, and , by going for quality, can create a valid and sustainable niche.

Genuine MLMs also discourage stockpiling. They genuinely do not want you to buy your way to top level by filling your garage with junk. They know that a few sob stories means bad press, and they have a genuine business. Good MLMs will tell you to only buy to fill orders, and to only carry stock once you have steady turnover to get rid of it.

If an MLM is trying to move a product that people do not buy very often then I would question the logic of MLM as a viable plan. Ditto if the product appears overpriced compared to the usual channels. And if they suggest buying some so that the clients don't have to wait, drop it like a stone.

In short you can make a lot of money, ( I know someone who made £250,000 in two years, and I heard since that he went over the million ), in genuine MLM, but you have to treat it like any other business, albeit one with a very low entry cost. Are there customers for your product, customers that you can reach and sell to?

However the reality is that for most people even genuine MLM schemes will result is something between a modest loss ( £100 - £500 in sundry expenses ) and modest profit, ( some personal clients and a few parties, plus a couple of other part timers in the downline to make holiday / little extras money). That said I would recommend trying an MLM to anyone with pretensions to their own business. It will be a very good learning experience, and, even if it makes a loss, cheaper and more useful than most courses. And perhaps you will be one those who make good money.

But you wanted to know about pyramids and scams.


Pyramids
In the UK Pyramid Selling is illegal. This has not stopped it happening, and under various guises, such as "business clubs", or (incorrectly) MLM , ( hence my introduction above).

A pyramid is ALWAYS presented as a way to make money. There might be a product, but even the most cursory study will show that there is no real market for that product, and that the trick is to sell the product or service to others who would only buy it in the hope of selling it to others who etc etc. Such pseudo products can include "reports", "catalogues", or "membership", as well as obvious rubbish.

There might not be a product, ( this is the approach of the "business clubs"). You pay to join because you think that you can get others who pay to join because they think that they can get others who etc etc.

The scheme may be incorporated as a business ( a mistake as it makes it easier for the DTI to close it ), or they might avoid that trap and be structured in another way, such as a club.

They might come up with a spurious excuse or talk about tax issues, making income tax free or some such plausible tosh.

A pyramid presentation may take many forms, but there is one thing that they all have in common, they will draw charts showing vast wealth in short time, from, it would appear, quite modest numbers of people in your downline. A lot of schemes ask for a draconian "confidentiality" or "secrecy" clause. This is bunk. It means nothing and will not protect the scam from anyone who knows the rules, but they do scare lay people.

The other key feature of a pyramid is that it MUST have new members to keep it growing. If it stops growing it dies because the recent recruits are unhappy, as they realise that they have paid out , and won't get any money. ( Compare this to a genuine MLM. Imagine that you build an organisation of 50 people, and then stop building. Do the new recruits lose? No, because they are selling product to the public. They do not NEED new downline, though such downline may well be desirable).

Some people will make money from the pyramid. These are the people who get in early, normally those who start it. Let us assume that you are not the person who starts it, but that you have been taken to a meeting or otherwise introduced. Let us assume that at the time you join there are only 200 members in the entire country, which I think you will agree is pretty early. ( In fact of course you will always be told that you are in early, and what that means in terms of numbers will never be made clear. As you can see below it does not really matter how early you get it, it is always too late).

Simple question, how much money will you make? I'm not going to answer that, but what I will do is look at how the pyramid grows, and then you can judge for yourself if you get offered one.

Let us make the following assumption. That each person talks to 5 people at each stage, and that 2 people, trusting their friend, actually join.

We will assume that as soon a decent journalist or financial adviser hears about it the scheme dies, either due to bad publicity or the DTI closing it.

From this it can be seen that the money will be made during the period before which the story breaks and the DTI close it down.

Some numbers. There are circa 15,000 Independent Financial Advisers and 200-300,000 in Financial Services generally. Let us assume that people on the whole are not daft enough to invite such people and that in fact only a few of the potential experts might get involved. Let us say that there are 10,000 who might, eventually be invited, and that that invite means death to the scheme via publicity or DTI.

There are 50,000,000 people in the UK, so the scheme should grow quite nicely before this happens.

Actually make that 30,000,000 earners. Still, plenty of room. But note, 30,000,000 divided by 10,000 implies that one person in 3000 knows how to , and has the motive, to stop the scheme.

Here goes the maths, and a "phase" is simply the time taken for that level of growth. It might be a week, a month, or vary.

200 people tell 5 each, so numbers who know of the scheme grow to 1200, and those enrolled to 600. You have introduced 2 people.

Does the scheme survive? Probably. You'd be very unlucky to have snared an expert.

Next phase. The 600 tell 5 each so 3600 people know about it, and the numbers enrolled grow to 1800. You have introduced 4 people altogether, and your downline has introduced 4, giving you an organisation of 8.

Does the scheme survive? Alarm bells are beginning to ring. An expert became aware of the scam when you passed 3000.

Next phase. The 1800 tell 5 each so 10,800 people know about it, and enrolment grows to 5400. You have personally introduced 6 people, and your organisation is 26 strong

Does the scheme survive? I doubt it, the press is on the trail and there are mutterings in the ranks of the recent members, ( 18 people in your group alone have handed over money and as yet seen NO return).

But lets give you one more bash.

5400 tell 5 people each so that 32,400 know about it. That is one person in every 1000. If you think there is still room for growth then you need your head examined. Lets forget this phase and assume that the scheme wound up with you having 26 people below you.

(The next figures are, as it happens, 97200, and then 291600, and then 874,800.)

As you can we have only progressed three layers deep and run out of room to grow. Pyramid scams work partly because most people cannot do the maths and do not realise how fast the scam burns through the population.


The Money.
Did you make any money? As an early joiner you should have had some good cash flow, but are you going to make any net money? Let us assume that profit is reached when you have an organisation of 4 people.

Well you have 26 so you have made money. But lets look at those people.

You introduced two people, probably friends, in each phase. They will have handed over some money. Hundreds of pounds for sure, perhaps thousands, on the basis that you said that they would make money. All they had to do was find 4 people, what could be simpler?

Lets see. In the last phase you introduced two people who did not get the chance to introduce anyone and are totally out of pocket. How do you feel? Want to make good?

In the previous phase you introduced 2 other friends, who have introduced two people each. They are out of pocket. Are you going to make good?

In the first phase you introduced 2 of your best friends, who each have 6 people in their organisation, so they have made money, but all those 6 ( i.e. 12 ) people are in a loss, and if your friends make their loss good then they have lost out. Are you going to help them?

The money flowed up the chain to the people who started it, and you can be fairly sure that either they , or their money, have left the country, leaving you with, quite possibly , a series of civil court cases and perhaps bankruptcy. The more you made, the more you lose. You certainly lose the friends whose money you lost.

Say the cost is £1000 to join and you averaged an income of £500 per person in downline. If you get stuck with the can and try to reimburse their money you have to pay out £26,000 on an income of £13,000, or let friends, and friends of friends, down. Suddenly buying that BMW does not look so smart.

Read that again - in the space of a few weeks you personally banked £13,000 in scheme income and were well on the way to riches, but sudenly as the scheme fails you need to find £26,000 if you want to keep your reputation. Since the people who took the other £13,000 are the scammers you can be sure that they ain't going to give it back.


Bullet points.
Beware any talk that concentrates on money , not product.

Beware any event at which a confidentiality clause must be signed. ( Though feel free to sign, you can simply ignore the entire document it if it turns out to be a pyramid, and you can report them to the DTI.

Beware any scheme where the money is derived from getting people to join the scheme, and there is no emphasis on selling actual product.

Beware any scheme whose product you would not buy yourself as a customer.

Beware anything not set up as Limited Company.

Beware any scheme where buying the product in volume is acceptable in advance of sales.

Remember. Sharp suited conmen the world over know only one rule, "you can only hustle a hustler". If at any time there is a nod and wink, an indication that you are lucky to be there, fortunate to have been selected, or about to rip off the tax man then be alert. They are looking for the guy who is nodding, the guy who thinks that he is smart, but is really just asking for it.

If it looks too good to be true, then it is.

Postscript. Since writing this I have had about one email a week from the US, from people concerned about some organisation or other, and wondering what to do. I have been informed that the following people want to hear from you. The National Fraud Information Center http://www.fraud.org The National Fraud Information Center is a non-profit organization headquartered in Washington, D.C., which helps consumers to report fraud and offers helpful advice on how to avoid becoming a victim.Incident reports are entered in the NFIC database and referred electronically to the National Electronic Fraud Database administered by the Federal Trade Commission and the National Association of Attorneys General. NFIC incident reports are also referred to variety of federal and state regulatory and enforcement agencies- the FBI, Secret Service, U S Postal Inspectors, Securities and Exchange Commission, and US Attorneys

[annsky]

Originally posted by Bobby Magnaye
MLM is a legitimate business and it only works for people who wants to do the work and with burning desire to succeed. It's not a get rich quick scheme. The more work you do, the more money you can make.

His right, problem with other people is, they only think of how much money they are going to get from it, without first thinking if they have the talent of recruiting people.
I recently joined an certain MLM, where a cousin of my husband recruited me, she invested $234, and her first check was worth $400+, next was $500+, then $1,300+ and last was $400+ again. So far I already received my first check worth $147.+.

[palacio_a]

Originally posted by brownpau
I'm with Forever Living, and it has some really darn good aloe vera health/beauty products and a decent at-your-leisure points scheme.

But there's a culture associated with MLM's that gnaws at me. People I know who seriously get into network marketing are taken over by it; their lives revolve around the business. There's so much enthusiastic materialism it's almost cultish, and more than a bit unnerving. Just attend a seminar, and you'll see what I mean.

By the way, anyone here with SkyBiz? Who's willing to pay $110 a year for webspace and email that you could get from any free service on the web?

The thing is you haven't incorporated the culture of FLP. Look if it looks cultish to you then get the hell out of our office! We talk about dreams and all thats what drives us on to work I mean I'm already a multi-millionaire but as far as happiness is concerned I Don't have it y? bec. I'm in traditional business but in FLP we talk about time and financial freedom! Now who in his right mind wont go crazy about THAT sort of thing! PLUS don't tell anything bad about other company as well the hell with them if they are the illegal type or legit MLM you should know that BECAUSE IT'S SLUNDERING!!! and you could be sued by a company because of that.

Well as an ethical networker I prefer to say that we don't have much choice but to go into MLM, as in all of us, you'll get what I mean when MLM starts bitting in the Phil. economy as it is in the 1st worlds.

BTW, Who wants to become rich contact me ASAP!

[palacio_a]

By the way, to all networkers participating in this discussion may i please request that we stop our crab mentality habit and avoid saying anything rude about each others company or that particular person risk of being sued. CASE: Slundering.

For future reference for future participants.

LOVE THE INDUSTRY, LOVE YOURSELF
-Culture of FLPPI

[zimdude]

Calling the finance people and economists...

It seems that the products sold via MLM are foreign products... well of course the stuff you buy at the supermarket are the same... anyway you can't let the money in country grow or else you'll have inflation..

so my question is, if the people in MLM gain, who loses?

How would you compare MLM business as opposed to the usual business which needs capital?

[brownpau]

we don't have much choice but to go into MLM, as in all of us, you'll get what I mean when MLM starts bitting in the Phil. economy as it is in the 1st worlds.

I constantly hear that sentiment... "Jump on, because MLM is the wave of the future, the wave of the new economy; this is how all businesses will be running in the future..."

I've been hearing it for years. And I know it's not going to happen. No business model will work on a wide scale where products are deliebrately overpriced in a pricing pyramid which gives cheaper products to the leaders whose only advantage is that they got on the pyramid earlier.

Oh, I have no doubt that it works, and it does make scads of money for people who can recruit and sell proficiently; but MLM is not something which will ever enjoy more than the niche market it does today, simply because the scheme doesn't work for anything bu t a small market. It draws on a large following of lower-level distributors to supply the needs of a smaller level of uplines without regard for the very distinct possibility of market oversaturation, product oversupply, or lethal product misrepresentation by uninformed-but-well-meaning distributors.

But I shall stop here. Wouldn't want to be accused of (giggle) "slundering," would we?

(Just to be fair, I still use FLP aloe vera products, and I find them wonderfully effective, even at these grossly inflated prices. Nothing beats constipation like that aloe juice.)

[palacio_a]

Originally posted by brownpau

we don't have much choice but to go into MLM, as in all of us, you'll get what I mean when MLM starts bitting in the Phil. economy as it is in the 1st worlds.

I constantly hear that sentiment... "Jump on, because MLM is the wave of the future, the wave of the new economy; this is how all businesses will be running in the future..."

I've been hearing it for years. And I know it's not going to happen. No business model will work on a wide scale where products are deliebrately overpriced in a pricing pyramid which gives cheaper products to the leaders whose only advantage is that they got on the pyramid earlier.

Oh, I have no doubt that it works, and it does make scads of money for people who can recruit and sell proficiently; but MLM is not something which will ever enjoy more than the niche market it does today, simply because the scheme doesn't work for anything bu t a small market. It draws on a large following of lower-level distributors to supply the needs of a smaller level of uplines without regard for the very distinct possibility of market oversaturation, product oversupply, or lethal product misrepresentation by uninformed-but-well-meaning distributors.

But I shall stop here. Wouldn't want to be accused of (giggle) "slundering," would we?

(Just to be fair, I still use FLP aloe vera products, and I find them wonderfully effective, even at these grossly inflated prices. Nothing beats constipation like that aloe juice.)

Theorethically over-saturation can happen...but in reality it can't pyramids are those companies who has no products...MLM is legit and will go the extra mile traditional business wasn't able to accomplish... if you like more info about MLM go read books about MLM in text books in ATENEO!! btw, Aloe vera gel is not overpriced if you like to contest that i'll just laugh... aloe vera gel can get rid of almost all your health problems now how much can that cost in a hospital?

[palacio_a]

Originally posted by arsel
earthwarrior1: are you now engage in MLM?

If not what's the best MLM here in the Philippines that you know? Yong affordable lang ha sa bulsa?

Actually madaming e, BUT i suggest you do some research kasi madaming potential manloloko na MLM, DAW, so... go get some knowledge and contact me via email and i'll give you the best... as awarded by the Consumer Union of the Phil, and European Economic Council.

palacio_a@edsamail.com

[palacio_a]

Originally posted by zimdude
Calling the finance people and economists...

It seems that the products sold via MLM are foreign products... well of course the stuff you buy at the supermarket are the same... anyway you can't let the money in country grow or else you'll have inflation..

so my question is, if the people in MLM gain, who loses?

How would you compare MLM business as opposed to the usual business which needs capital?

Simple... the loosers are those who cannot move thier products among thier target matket... madami yun hirap sabihin lahat...

MLM is a better way to move products to your target market and traditional is limited within the range of that business's capacity to advertise the product through local media, in MLM you already have a customer base so advertising won't be a problem (As with jockey who joined FLP Taiwan who's sales shoot-up way beyond the normal level).

[palacio_a]

Originally posted by Theophilo
"Master of my destiny," eh?

And what if I want to be a topnotch web applications developer? I sure won't get there selling health and beauty products at deliberately inflated prices which pay for my upline.

What if the market gets saturated so there's no one left to be recruited? I end up at the bottom of the chain, again paying deliberately inflated prices for products whose actual worth is about half the cost I'm getting them at. And the markup isn't because of a handing-down from wholesale to retail; it's because the people who recruited me are above me on ... gosh, what other shape could it be but a pyramid?

first of all... you don't know anything about MLM, that for sure i know, so read about MLM first before you speak your ideas, which is by the way a wrong idea of MLM(MAGALING YUNG MGA NAG-AGREE SA KANYA!), i suggest you discuss this with ateneans taking MLM courses so they can enlighten you about MLM.

[palacio_a]

I don't know if anybody wrote this but might as well share it.

in MLM you sponsor people into your business right...

SO if 5 begets 5, and 25 begets 5 per person, and 125 begets 5 per person... and so on.... thats what people call saturation until it reaches a number equal to a significant number of the whole population, around 60 percent...

In theory that can happen but in reality it can't... if this is true then FLP should have run out of proespects in the Phil. but i, as i have experienced it, is of the total opposite.

Not all people will join MLM around 90% will choose to reject your offer and the rest will join and out of those who will join you around 50% will drop-out.

With this statistic V.S. Birth rate you will see why over-saturation cannot occur.

I hope i have enlightened those who have no idea about MLM.

PS: NETWORKING IS A PROFFESSION AND CODE OF ETHICS GUIDES IT so reminder to other networkers pls. stop proselytizing other networkers in other firms.

LOVE THE INDUSTRY, LOVE YOURSELF.
-FLPPI CULTURE

[palacio_a]

Let me share something to you a story that has a lot of lesson.

an elephant is chained to a metal peg, now think can an elephant with all it's might break free?, but why cant that elephant break free? why do you think? the answer is in his past... when the elephant was young he doesn't have enough strength to break free from the restraints now as that elephant gets older he mindsetts himself that he can no longer break free from the restraints... now relate this story to your life...

BREAK FREE FROM THE MENTAL CHAIN!

Wake up to reality and accept the facts! it's time to realize what life truly means...

WE ALL HAVE DREAMS TO ACHIEVE... BUT IS YOUR DREAM BIG ENOUGH?

"ask and you shall recieve, seek and you shall find, knock and you shall be opened" --- This has a reason decipher its meaning.

[brownpau]

Originally posted by palacio_a
Theorethically over-saturation can happen...but in reality it can't pyramids are those companies who has no products...MLM is legit and will go the extra mile traditional business wasn't able to accomplish... if you like more info about MLM go read books about MLM in text books in ATENEO!! btw, Aloe vera gel is not overpriced if you like to contest that i'll just laugh... aloe vera gel can get rid of almost all your health problems now how much can that cost in a hospital?

I won't contest your flood of arguments for the legitimacy of MLM as a business. You are, after all, entitled to your opinion, and I'm sure that just because Ateneo teaches it, that makes it a perfectly legitimate venture. But on pricing, just a note on costs...

Aloe Vera Gel, distributor-level: P450.
Aloe Vera Gel, "manager"-level: about P225.

Managers get a 50% discount. That's with rebate figured in already. So what's the real cost of the product, and why is it so grossly overpriced (double!) when it could be readily available to the consumer at 50% of the distributor cost? That's not just wholesale-to-retail markup, and not just import tax. It's payment to customers whose main advantage, again, is that they started earlier. Is that legitimate? More importantly, is that ethical?

[aticus]

from: palacio_a
first of all... you don't know anything about MLM, that for sure i know, so read about MLM first before you speak your ideas, which is by the way a wrong idea of MLM(MAGALING YUNG MGA NAG-AGREE SA KANYA!), i suggest you discuss this with ateneans taking MLM courses so they can enlighten you about MLM.

Well, I find your insult of a fellow PExer a bit disturbing. In any case, I studied in Ateneo. Now I'm a consultant and one of my clients in the past three years is one of the biggest MLM groups in the country. I know what I'm talking about with MLM. I can even give you the facts and figures, including the processes and prices, of groups like Amway, Nu Skin, etc., etc.

That said, however, I will have to agree with Brownpau and many others who say that MLM is a dodgy proposition for many, many people.

And to take off from zimdude's question about who loses, let me say the following:

1) Not every MLM group, even the legitimate ones who actually sell real products, have products that people will really use. My favorite example has always been Amway's "Glister" toothpaste. I mean, seriously, I know at least 20 Amway distributors personally, and NONE of them use it. That's right. Zero. Nada. They use Colgate, mostly. This means that the prospects for long-term growth are difficult, bec. at the end of the chain, you'll have people who invest thousands for products they don't use and can't sell. The end-users lose, mostly. And the distributors who are stuck with difficult to sell items also lose.

2) Yes, there will be oversaturation eventually for many MLM groups. And my definition of oversaturation is, I think, a bit more realistic than mr. palacio's. I don't define oversaturation as having too many people as distributors. Of course you'll never get even as much as 10% of a country distributing the stuff you sell. I define oversaturation as having NO REALISTIC CHANCE OF SELLING TO ANY OF YOUR KNOWN CONTACTS. This, I believe, is already happening with many groups. It is also why it is imperative that the products you sell be priced attractively, because when you can't sell to your friends, the only way to make money is to recruit total strangers. And THEY won't buy on the basis of trust alone. Since these products are priced atrociously high, it is extremely difficult to penetrate other markets.

3) Finally, NOT EVERYONE GETS RICH WITH MLM. In fact, I can say with confidence that, contrary to the nice statistics your MLM marketer will show you, a majority of MLM salespeople are not only NOT rich, but are struggling to make a living. Mr. Palacio aside, there aren't many multi-millionaires in MLM. Most of them are those who came in within the first 6 months of operation, and are often friends of the main distributor here in the Philippines. I know one MLM company whose sole "diamond" distributor, the guy who won the BMW prize, was actually the father-in-law of the guy who started it all! No one else has won the BMW in the company. I'm not surprised at all.

I would seriously caution anyone about joining an MLM group. The people who sell are highly-trained, very glib, and quite impressive-looking. But they don't always sell you products you can use. And the only way for you to often make money is to get all your friends and family involved, many of whom will rue the day they joined you.
In my humble opinion, I would only consider at most two or three groups to be viable long-term options for most Filipinos.

My advice? Make sure the products you are required to purchase are those you would regularly use yourself. If YOU don't use them, why would you expect your friends and family to? And would you really sleep well at night knowing you sold your mom toothpaste that isn't as good as Colgate and costs much more?

And I'm sorry, I just can't resist , but I am not "slundering" anyone!

[bagyoboy]