Can MLMs Be A Legit Business Model?

As you continue your journey searching for legit business opportunities, you will quickly realize that you are surrounded by MLM offers all around you. Which will likely lead you to one question. Are they legit businesses and can you truly make money off of them?

If you are new or perhaps unsure of what an MLM (Multi-level marketing) is, here is a quick definition of what it is as per Investopida:

Multi-level marketing is a strategy that some direct sales companies use to encourage their existing distributors to recruit new distributors by paying the existing distributors a percentage of their recruits' sales; the recruits are known as a distributor's "downline." All distributors also make money through direct sales of products to customers. Amway is an example of a well-known direct-sales company that uses multi-level marketing.

 

A few other examples of them that are commonly known are Avon and LulaRoe.

If you do a quick search for these types of businesses, you will see many people calling them scams and advising people to avoid them as a whole. While this isn't bad advice, you should consider that not every person is a natural born sales person and many won't be good at selling. That is a-okay! This world is full of diversity and that means we need people who are good at different skills. Not everyone will be good at selling and that is certainly not a bad thing. 

But here comes the kicker, because many people who are not good at selling try their hand and it doesn't go their waythey are quick to call it a scam. That isn't exactly fair to the company and while the angry sellers feel duped by the company, that doesn't automatically make it a scam.

Does that mean that people haven't been scammed or perhaps put in a negative zone by a MLM? Certainly not, but just because they have had a few bad apples, that does not make every single one of these companies bad. A lot of them do rely heavily on a downline and push their sellers to focus on that along with buying merchandise that they may not be able to move on their own. That more or less should be researched by the person researching a company before they sign up. People should not be so quick to hear the flashy marketing and jump at what they deem to be a "promise" of thousands flowing in easily. Yes, those advertisements are doing what they are designed to do, which is market their brand for sales. Typically, when you sign up, you are buying as a customer who is preparing to be a sales person for them. You are no different than a regular customer buying the merchandise from you. Many people get caught up and buy into the idea and lifestyle that they are selling.

What can you do to prevent yourself from being caught up by the marketing of these MLMs?

1. Do your research! Most of the time they will have FAQs where they will mention what they require of their salesmen (such as what they expect to meet in terms of sales, etc) and what limitations they may put on you. Know what you are getting yourself into before signing the dotted line. This is good business advice in general and not limited to MLMs.

2. Talk to other sellers, if you can. Find out what they like or do not like about the company. Do they feel that the company is honest and fair, or do they feel wronged?

3. Are you a natural born seller or do you feel like you can get outside of your comfort zone? These are things that are often overlooked and these are key pieces of information you need to consider. If you are not a good seller, are you willing to learn and try it? If not, then you are most likely not cut out for MLMs. There are better fits for you and your life than those. 

4. Have a goal outside of the MLM. Like most retail or sales jobs, MLMs are not ideal for a life-long career. In some cases, yes, it works out fine for some people. However, for most people, they are not a long-term career or business that most people will want to be committed to for life.

Have you had any good or bad experiences with MLMs? Or perhaps you have almost signed up to one and decided last minute not to? Either way, please share your thoughts and experiences with them. Be civil, as this is a place for conversation and not bashing.