How are you able to tell the difference between a legit MLM opportunity and one of those network marketing scams or pyramid operations everybody has warned you about?
What is the difference that makes all of the difference? Is there an easy way to separate the wheat from the chaff, chew the meat and spit out the bones, and defend you and your pocketbook from being taken for a ride? Let's dig a little deeper into the subject.
Network Marketing Scams Defined
There are plenty of different terms for network marketing, including MLM, matrix marketing and dare I state pyramid schemes but they all descend to a business model for offering goods and services with networks of independent suppliers and direct salespeople. Ask anyone what the most prominent network marketing company is and they'll probably say Amway.
Amway has a network of tons of active providers globally who produce billions of dollars in sales per year.
Back in 1979 "network marketing" was put on the stand when Amway underwent an FTC investigation inside the United States. According to the 2008 court judgement within the United Kingdom, each fraudulent claim was dismissed.
Fundamentally the FTC discovered that Amway was not guilty of being a pyramid scheme and that the distributors where not breaking any laws through their compensation plans. It is not illegal to recruit people and have them sell your products or services and obtain bonuses in commissions for sales volume.
Just how to Spot Network Marketing Scams
In a legit network marketing opportunity, commissions are earned only on sales of the company's products or services. Commissions can be paid on both wholesale and retail sales. But no money may be earned from hiring other people as a distributor. Put simply, you can't make a dime from sign up fees. If a company pays out for the sign up fee, probabilities are it will fall into that dreaded network marketing stings class as it then becomes an illegal pyramid or ponzi scheme.
Protecting yourself Against Network Marketing Scams
Unfortunately every year there are people that prey on would be network marketers by supplying dubious MLM opportunities. They undoubtedly will not last in excess of a few months or as few a couple of years because they take people's cash rapidly, do not provide the product or service and afterwards disappear. Extremely few bogus network marketing providers will definitely be there after five years.
Guarding yourself against one particular of these fraudulent network marketing scams can be carried out by acquiring a business that has a track record and is immune to legal ramifications from their compensation strategy. You'll be able to checkout Nexeria.com for a list in the top rated 25 MLM firms that qualify:
* They have a legitimate multilevel settlement deal * They've been in business for over a decade * Their site has good Google ranking (PR1 +) * The web site has an Alexa ranking * The provider appears in Google trends
- Company has been in business for a minimum of a decade. - Firm provides a MLM compensation plan for it is distributors. - Company has an Alexa rankings. - Organization has history in Google Trends Reports. - Company at a Page Rank of Higher than 1.
Nonetheless, even the criteria listed above has absolutely nothing to complete with the probable achievement you'll have in such a business. So now you realize the traps, and are far better equipped not to fall into the dreaded "network marketing scam" category.
What is the difference that makes all of the difference? Is there an easy way to separate the wheat from the chaff, chew the meat and spit out the bones, and defend you and your pocketbook from being taken for a ride? Let's dig a little deeper into the subject.
Network Marketing Scams Defined
There are plenty of different terms for network marketing, including MLM, matrix marketing and dare I state pyramid schemes but they all descend to a business model for offering goods and services with networks of independent suppliers and direct salespeople. Ask anyone what the most prominent network marketing company is and they'll probably say Amway.
Amway has a network of tons of active providers globally who produce billions of dollars in sales per year.
Back in 1979 "network marketing" was put on the stand when Amway underwent an FTC investigation inside the United States. According to the 2008 court judgement within the United Kingdom, each fraudulent claim was dismissed.
Fundamentally the FTC discovered that Amway was not guilty of being a pyramid scheme and that the distributors where not breaking any laws through their compensation plans. It is not illegal to recruit people and have them sell your products or services and obtain bonuses in commissions for sales volume.
Just how to Spot Network Marketing Scams
In a legit network marketing opportunity, commissions are earned only on sales of the company's products or services. Commissions can be paid on both wholesale and retail sales. But no money may be earned from hiring other people as a distributor. Put simply, you can't make a dime from sign up fees. If a company pays out for the sign up fee, probabilities are it will fall into that dreaded network marketing stings class as it then becomes an illegal pyramid or ponzi scheme.
Protecting yourself Against Network Marketing Scams
Unfortunately every year there are people that prey on would be network marketers by supplying dubious MLM opportunities. They undoubtedly will not last in excess of a few months or as few a couple of years because they take people's cash rapidly, do not provide the product or service and afterwards disappear. Extremely few bogus network marketing providers will definitely be there after five years.
Guarding yourself against one particular of these fraudulent network marketing scams can be carried out by acquiring a business that has a track record and is immune to legal ramifications from their compensation strategy. You'll be able to checkout Nexeria.com for a list in the top rated 25 MLM firms that qualify:
* They have a legitimate multilevel settlement deal * They've been in business for over a decade * Their site has good Google ranking (PR1 +) * The web site has an Alexa ranking * The provider appears in Google trends
- Company has been in business for a minimum of a decade. - Firm provides a MLM compensation plan for it is distributors. - Company has an Alexa rankings. - Organization has history in Google Trends Reports. - Company at a Page Rank of Higher than 1.
Nonetheless, even the criteria listed above has absolutely nothing to complete with the probable achievement you'll have in such a business. So now you realize the traps, and are far better equipped not to fall into the dreaded "network marketing scam" category.
About the Author:
Joe Burke writes under the names jbmuchin and augustus1. His usual topics are MLM, Internet Marketing and Network Marketing. His articles can be found on many article directories.mlm scams, andnetwork marketing tips
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