The Basics About Multilevel Marketing Businesses
How successful are multilevel marketing businesses? Let’s just pump out some numbers here, shall we? Avon, probably the most well-known MLM company in the world, tops $6 billion a year. Amway makes about $4 billion, Herbalife about $1.5 billion and Mary Kay $1.2 billion. That’s how well multilevel marketing businesses are doing these days, thanks to the hard work, solid product and service lines and tireless recruitment practices of its members.
What is a multilevel marketing business?
A multilevel marketing business, also known as an MLM is essentially a networking business. Unlike traditional forms of businesses, MLM is made up of representatives, distributors or members who are allowed to recruit other distributors and members to form a downline.
Depending on the business model being followed by the MLM program, members earn by collecting commissions from the sales generated by their downlines and commissions obtained from their own sales. Sometimes, recruiters earn a percentage from the membership fees paid by their downlines. However, in legitimate MLM businesses, this is not the only means with which members earn. Otherwise, the business will be treated as a pyramid scheme.
Are multilevel marketing businesses legal?
Yes. The manner with which an MLM business creates its sales force and pays its members is perfectly legitimate. Problems only arise when unscrupulous individuals begin using the concept of MLM for their own dubious designs, either to promote a business that doesn