A multi-level marketing company is a company which uses “distributors” or “salesmen” to find customers and other distributors which get put at the bottom of a chain or pyramid. Usually in companies like this, only those few at the very top are able to make much money in the company.
Some people equate multi-level marketing companies with pyramid schemes. That isn’t necessarily true. Here are two things to find out before becoming involved in any “multi-level” marketing company.
1- Does the company make at least 70% of its sales to people that are NOT going to become "distributors"?
2- If they have promised huge monetary returns to you, did they disclose the actual average earnings of ALL distributors as well as the percentage of distributors that HAVE earned the promised returns?
All multi-level marketing organizations are legally required to disclose this information.
If they don't make at least 70% of sales to non-distributors, then it is most assuredly a scam. And if they can't promise reasonable compensation for you (rule 2), then I wouldn't get involved if I were you.
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