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So you meet your buddy at a burger joint. You reminisce about old times and play catch-up. You’re having a real good time. But then he mentions this nutrition company he’s been selling for lately. He says he’s just getting started, but there’s a lot of income potential. In fact, he knows a guy who has paid off his mortgage working for this company. He thinks you’d be a perfect distributor for it because you lift weights and you’re driven.
This fact is rarely mentioned in the sales pitches. Instead, they typically promote the merchandise (referred to as "lotions & potions" by MLM critics) as wonderous super products that will be in high demand. But, you should always beware of success stories coming from MLM distributors. Most MLM companies pay shills who lie about having had multimillion dollar success with the scheme. These are typically the ones who travel around giving seminars, pitching motivational materials, and putting on recruiting extravaganzas that have been criticized by the Federal Trade Commission for promoting an almost cult-like religious mania as a substitute for sound business practices.
Now, many people are understandably flummoxed by a very active campaign to convince the public that CBD is different depending on whether it’s derived from marijuana or hemp. Hemp and marijuana are both Cannabis. Hemp is Cannabis sativa, and marijuana is either Cannabis sativa or Cannabis indica. Hemp is simply the common and legal term for cannabis that contains less than .3% THC, and marijuana is the common and legal term for cannabis that contains .3% and more THC.
Jim’s friend who recruited him into the company starts telling Jim that the way you really start making money with Company A is recruiting other people beneath you to sell shakes. “When you sign someone up,” explains Jim’s friend, “you will start getting a 10% commission on the product your recruit is required to buy from Company A in order to qualify as a distributor. If you can get 3 people to sign up, it means you would be earning 10% commission on all the product those 3 recruits are required to buy, plus whatever they purchase beyond that minimum.”
I've spoken with enough friends and other people who are into network marketing to know that the default response to this is "Oh, but this plan is different." Sure, every plan has different tweaks and details, but fundamentally they are all the same. The company is going to make tons of money selling an outrageously overpriced product every month to their captive audience buyers: You, and any friends you recruit. Not one of you has any realistic hope of coming out ahead. My advice to everyone involved in network marketing: Simply stop now. Stop convincing yourself that profits are just around the corner if you just buy a few more cases of expensive product. Just stop now, walk away, consider it a lesson well learned, and don't give them another dollar.
An agent can enter an MLM business on very little capital (around $100)—and yet will feel as if in business for him of for herself. Jeffrey Gitomer, writing in the Business Journal, noted that many people value the opportunity to be their own boss and control their own destiny. "The secret to successful network marketing is you—the messenger—and your willingness to dedicate and focus on preparation," he wrote. "Your willingness to become a salesperson who believes in your own ability to succeed. Everyone wants success, but very few are willing to do what it takes to be successful."
Icahn is helping vet Trump’s choices to head the regulatory agencies and one of his companies has already benefited on Wall Street from the selection of Trump’s Environmental Protection Agency pick Scott Pruitt, whom Icahn helped vet. If Icahn assists Trump in naming FTC commissioners, he will be helping to staff the body charged with enforcing the Herbalife settlement.
"Let me tell you about an incredible ground-level business opportunity," and you are invited to a house or to lunch for "a discussion." Funny enough, you feel sick in your gut that there is some hidden agenda or deception. "Probably a multi-level marketing (MLM) organization," you think. Suppose it is? Should you trust your instincts? Is there anything wrong with MLM?
The U.S. Department of Health & Human Services also recommends that consumers should be aware of any active ingredients that dietary supplements may contain. An active ingredient of a substance is any component that produces a biological or chemical effect on the body. Our products do contain active ingredients. The most abundant active ingredient in our supplements is the CBD in our hemp extract.
Multi-level marketing is a legitimate business strategy, though it is controversial. One problem is pyramid schemes, which use money from new recruits to pay the people at the top, often take advantage of people by pretending to be engaged in legitimate multi-level marketing. You can spot pyramid schemes by their greater focus on recruitment than on product sales.
Example: Let's say I sell $10,000 of widgets every month, and my profit margin, after accounting for all expenses, is 10% - $1,000 per month. Let's say I decide to start an MLM business and I recruit another distributor, who takes over all my leads. We'll make a REALLY generous assumption that my distributor's profit margin is 5% - many MLM products don't even scrape 1%.
Dr. Brezinski’s point is well taken and easy to see practiced by popular network marketing companies. Many MLM and NM companies tout a three-to-five year plan to attain freedom and wealth, yet many of the people running company meetings have been in the business for five or ten years and still haven’t left their full-time job or landed on easy street. “As it turns out,” Dr. Brezinski notes, “when other human needs are being met, the members and consultants don’t focus solely on the financial aspects.”
Although MLM is most commonly associated with direct-selling distributorships and/or party planning companies, some major financial/insurance companies also employ this strategy, including Primerica and World Financial Group (WFG). Although party plan consultants will certainly gain valuable grass-roots marketing experience, the college-educated marketer will seek positions within these larger financial companies, or at the corporate level of an MLM company.
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