Silicon Valley Blogger joins some others in hating on a particular MLM company. You can read his/her post to find out which one and why …
Now, I have absolutely NO experience with that particular MLM, and very little personal MLM experience at all, other than reading a lot about MLM when I was younger and participating in Amway for a little while.
But, I take issue with SVB’s sub-heading (about half-way into his post; asking: “Does MLM go too far?” And, I wasn’t afraid to tell him/her so:
I don’t think that there’s anything inherently wrong with MLM; it’s like saying that franchising sucks: it all depends on the company.
It’s POTENTIALLY a great business model on 3 levels:
1. For the company: they get to take a product straight to market, cutting out layers of fixed marketing costs by replacing them with a multi-level commission structure.
2. For the (very?!) small % of ‘distributors’ who build large networks: they get to build a ‘passive’ income stream that lasts as long as the company does. I have a friend who makes $200k+ a month (for years now), and sips coffee and develops property when he gets bored. Not so bad.
3. For the majority of distributors: they get to buy product that they presumably love and use at discounted prices, and they may even earn some ’side income’. It’s what they do with this money (invest? start a ‘real business’?), and what they learn (people skills? sales skills?) that can provide the real value.
… this is all assuming that they do their homework and choose a reputable company. But, isn’t that the case with everything we do or invest in?
DISCLAIMER: The author of this comment has no relationship with any MLM, being a retired multi-millionaire who made his money in MUCH more mundane ways (‘real business’ and ‘real investing’)