Network Marketing has recently become very popular. Not the best financial situation in the world is pushing people to find an alternative method of making money, very often online method. Let’s talk about MLM, one of the home business models.
Business idea categories
I want to let you know, that there are a different ideas of business, before we start talking about MLM, which is just one of these ideas. It will help you to make your own decision, as everyone likes something different. The most important thing is to let you know that every business is based on selling something to a wide group of people, customers.
That’s the foundation for every business model. It’s very simple, you make money if you can sell something, no matter it’s a physical product, software, service or information. The wider the audience, the greater the chance of earning more money.
Due to the form of cooperation, business model, and source of the idea, we can specify the following categories of business ideas:
1) Own Business
- Start Up – related to the new technology, the best example is an online store. What’s interesting, you don’t have to sell a physical product, you can if you want, and have access to these products in good price, or you can also produce your own product, for example candles. It is a good idea to create your own digital products, such as online courses.
- Traditional Business – I think we don’t even need to explain what is that. Traditional or stationary business is still the most popular business model. The problem is that you need to have enough money for a start. If you want to open restaurant, you have to pay rent for the local, all the tools, bills, food and obviously pay people who work for you. Check the article Traditional or Online Business?
- Freelancer – one of the best choices of you have no money for start, but you have appropriate skills and tools to do the job. The job is to search for orders online. You can write articles, create the graphic, design website and more. If you are interested in this business model, I recommend creating your profile on Fiverr, which is the biggest online portal for freelancers.
2) Ready Business
- Franchise – ready ideas for implementation, business based on a license under the franchisor’s brand. For example popular McDonald’s or KFC.
- MLM – this form of cooperation has many supporters and opponents. We are going to talk about MLM in this article.
- Company purchase – you need to have a lot of money to buy an existing company, and I’m not talking about big corporations. Then you have to continue the development of the company, or implement your own solutions, which must be profitable.
3) Business Partner
Reseller, distributor, broker, agent, affiliate marketer. The work consists in establishing cooperation with suppliers and selling their products.
I hope so the scheme above will help you to choose the best business model. It is important to start something that you are sure and you like it.
What is MLM?
Multi-Level Marketing is a model of business where you are selling the product of given company. You need to buy that product first. Another task is to recruit other people, and once they’re recruited, you get the commission from their sales. MLM companies are existing long time on the market in almost every country in the world.
Everyone can join the MLM company. There is no special requirements. You need to have money to buy the product you want to promote. How does it work? It’s very simple. You can contact the MLM company, or agent/distributor who works for the company already.
They will welcome you kindly. Next some kind of training is provided, and you’ll be ready to buy their product, which you’ll need to sell to make money. The most important task is to recruit more people, who will be under you in the company’s structure. You’ll get the commission from each person.
If these people will recruit others in the future, you’ll get paid commission for that as well. For example, your are on level A. There is 3 people you have recruited on level B, under you. You’ll get the commission for every sale these people made. That three guys also recruited someone, for example each person recruited 2 people, who are on level C.
In effect, you will get paid for each sale of people from level B, let it be 20%, and for each sale of people from level C, let it be 10%. People from level B get 20% commission from level C. What happens if people from level C will recruit someone? We will have level D and obviously you’ll get paid for each sale of these people, for example 5%.
This is how the MLM works. Your main task is to build the network of people, who are under you, and they will generate a profit. That’s why MLM is also called a Network Marketing. Selling the product is also important. Remember that your sales will bring the commission to someone who is above you.
Product you promote is also important, as nobody is going to buy something what is useless. You have to make sure that you sell something that people really need, and it’s not easy.
Is it worth?
As I mentioned above, Network Marketing has many supporters and opponents. I personally belong to the second group and I’m going to tell you why.
My Money Force, by definition, is dedicated to financial topics, for people who want to earn money online. I am a person who is guided by honesty and ethics in business, and this is missing in MLM companies. Years ago MLM companies were working usually offline. I remember in 90s last century, almost nobody had access to the internet.
I’m sure that many of you, dear Readers, let you know Avon, Oriflame, or Amway. These companies are a great example of Network Marketing. In that times, agents, who work for them, had to talk to other people, friends and family members, to convert them to buy the product or joint the structure of MLM company. It was really hard.
Today we have internet everywhere and Network Marketing started the “online mode”. You can notice that, while browsing Facebook, Instagram, and other social media. Especially the groups about making money online.
People working in MLM structures tempt with big earnings, financial independence, expensive cars, awards and connections, while all this is a lie.
The only ones who make big money is person on the top-level, and people who are two, three levels below. All the rest is making a little, pocket money, or losing money. As I said, to start your MLM “business” you need to buy a certain amount of products, usually every month. Otherwise, you will lose your “job”.
This is the mechanism that is designed to ensure liquidity of income for higher levels in the MLM structure.
Once you have joined Multi-Level Marketing company, they will probably offer a training for you, obviously not for free. And to be honest, there is nothing wrong with selling training and courses, but it must be something that is useful for you. The courses provided by MLM companies are usually useless. There is no substantive knowledge there, but manipulation methods.
Very often MLM leaders influence the emotions of their subordinates, promising them huge earnings and solving all problems, even in personal life. If you haven’t reached the monthly target, they are going to tell you that you are lazy, or worse, even cut off contact with friends and family, because according to the leaders, your loved ones limit you.
Doesn’t that sound familiar? Don’t religious sects work that way? Exactly! They do! That’s why I’m going to call all MLM companies a financial sect. The same as Jehovah Witnesses, and other sects, they are recruiting people just to pump their money out of them.
There are plenty of people who lost their money, friends even spouses and other family members, thanks to Network Marketing. They turned their houses into a warehouse of useless stuff that nobody wants to buy.
The quality of the product offers by MLM companies is usually very bad. I spoke to the people who had been involved in Network Marketing, and they said that you can visit your local store and buy better products for much cheaper.
And now have a look. If the quality of the product you promote is poor, and the price is high, you are pushed by your leader to lie to the people! That’s why I said there is no honesty and ethics in MLM.
Have you ever heard anything about Pyramid Scheme, or Financial Pyramid? Two names for the same thing. MLM is very similar to Pyramid Scheme. The difference is that in Pyramid Scheme you are not offering any product. Your task is recruiting people and your earnings depend on people paying money to the Pyramid.
Financial Pyramid is illegal in many countries. For example in Poland it is punishable by imprisonment from 6 months to 8 years. MLM is officially legit, just because of that, they are selling something (usually physical product). For me, personally it is a form of Pyramid Scheme.
If you are still looking for an answer for question “is it worth to start MLM business?”, I can tell you: NO, it’s not!
What’s the alternative?
As you can see, it’s better to avoid Network Marketing, even if it looks very attractive to you. The statistics show that the most people are loosing their money. I think it would be better to play lottery, then get involved in MLM companies. The financial effect is better, and you’ll avoid the problems related to that “business model”
In my opinion Multi-Level Marketing is not a business. It’s more like job, as you work for someone else, and you need to achieve the goals imposed by someone else. In typical business you are the person who makes decisions and sets the goals.
OK, but what’s the good alternative to MLM?
It depends on what you are looking for. I’m going to show you several examples of legit and honest ways to make money online. If you are looking for a quick money, you need to let you know that it cannot be a life changing income. Let’s call that “pocket money”.
- Honeygain is an app where you can earn money online without any investments. What you need is internet connection and mobile phone or laptop. I prefer laptop or desktop computer, because it works faster. You can withdraw money from $20 via PayPal or Bitcoin. $5 Bonus for new users.
- Stormgain – another good app, where you can make more money, then on Honeygain, but it requires some knowledge about trading and cryptocurrencies. It’s a cloud miner. You can get a $3 Bonus. Check the article How to Make Money Online Without Investment, where I show, step by step how to use the Stormgain app.
- Freecash.com is an online platform, where you have to do different tasks and receive money for completing them straight away. Some tasks pay really good money, even $50 for one task, it depends on what task you are going to complete. You can get the random bonus between $1 to $250.
I have described the apps mentioned above in the article Bitcoin Investment Strategy, as you have a chance to get Bitcoin for free, that means without investing your money. You’ll find there some interesting information. If you’ll decide to start your journey with Bitcoin, or other cryptocurrencies, I also recommend keeping your money safe, in crypto wallet.
If you don’t let you know what the crypto wallet is, you’ll learn everything here.
If you are looking for good money in long-term perspective, there are different ways of making money online, then apps above. Affiliate Marketing is a great business model, and fantastic alternative to Network Marketing. It’s completely different from MLM.
The major difference is that you are your own boss, what makes it a real business. How to make money in Affiliate Marketing? It’s simple: by coping and pasting links. What’s important, you can choose the products you want to promote and you don’t have to behave like a peddler. Instead, that, you can choose really good quality stuff, paste the link to it and someone who is interested in that, will simply buy it and you’ll get the commission.
You can work whenever you want, and create your own strategy, what makes you independent. If you haven’t heard anything about this business model, I can suggest you two platforms, which in my opinion, are the best for affiliate marketers.
- Wealthy Affiliate – a great platform, if you are a beginner, Wealthy Affiliate will teach you literally everything about Affiliate Marketing, and not only. The platform offers two core training, plenty of additional courses and classes, fantastic community, support 24/7, all necessary tools. Check the Wealthy Affiliate Review, where you will find more details.
- MyLead – another fantastic platform, but it is different from Wealthy Affiliate. MyLead offers training and classes as well, but also important tools, for example to promote your affiliate links in social media, like Facebook, which is automatically blocking this kind of links. MyLead will help you to avoid the block on Facebook and other platforms. MyLead is affiliate networking, that means you’ll find there plenty of ready affiliate programs, and some of them are really profitable. MyLead is completely free, you don’t have to pay anything for registration etc. Just registered and start making money.
Affiliate Marketing is not the only one way to make good money online. I’m sure that everyone has some skills. If you let you know anything about the computer graphics, you can register on Fiverr, create your profile and just wait for the tasks form other people. Fiverr is the most popular platform for freelancers. A lot of people around the world are using it every single day.
If you have writing skills, you can get paid for writing something, for example articles. You can use writing skills to write your own books and publish them on Amazon KDP, which is 100% free. Amazon is the online store, known everywhere in the world. That’s why you can have a lot of customers.
You can publish no-content book, like notebooks. It’s very easy. You can use Canva (also for free) to create a nice looking covering and publish it as a notebook, and trust me, many people buy it!
And finally creating your own vlog on YouTube is last time very profitable method of making money. You can show literally everything in your videos, people will watch it and you’ll get paid from YouTube.
There is a lot of methods to make money online, but I would have to literally write a book to describe all of them. I just tried to show you the easiest ones.
Many people can see an opportunity in MLM business model, but unfortunately we have to clearly say it is a deception. MLM leaders promise life changing money, but they do not say everything. The true is that you are going to lose your money and probably get in the trouble.
Another thing that they don’t say is the settlement with the tax office. Usually you should to be self-employed, as they will not pay the tax for you. If you won’t pay the tax you’ll get in big trouble and they don’t care about that. They care only about the money and to recruit more people who will pay them.
MLM is a business, but only for people in the top of the Pyramid Scheme, and we have to clearly say that the Network Marketing is a legal form of Financial Pyramid. They work like a religious sect, and unfortunately many deceived people wasted their money, life and even lost their friends.
Network Marketing is not a home business. It’s a scam, that we should to avoid and warn others about the danger of getting involved in MLM.
Fortunately there is a lot of alternative, cheaper, or free ways to earn money. I have presented the scheme in the first paragraph of this article, to show you how many opportunities you can have. One of the best alternatives in Affiliate Marketing, where you are fully independent form leaders. You are your own boss, and that’s the proper business.
And what is your opinion? Do you have any experience? Or maybe you let you know someone who was/is working in MLM structure? Let me let you know in the comment below!
If you like this article, please share it in social media, so other people can read it as well.