Pyramid Schemes are illegal schemes that pays people to recruit members into the scheme without any purchase of products. Such schemes have very few people at the top of the structure and many people at the bottom of the pyramid. People join such schemes in hope to profit from recruiting members.
It is sometimes difficult to differentiate a honest mlm scheme from pyramid schemes because of the many similarities in structure. But the main difference is that pyramid schemes earns money from you when you join, but mlm schemes lets you earn money through the sale of products and services and not primarily through recruitment of new members.
Pyramid schemes are not sustainable as there is a limit of people joining the network. In most cases, the bulk of the members in a pyramid scheme will lose money and time, while the people in the top of the structure profits the most.
People commonly mistaken MLM companies for Pyramid schemes. But in a good MLM company, you will only be rewarded if you work hard.
The main objective of an MLM is to enlarge the area of distribution for different goods by involving as many people as possible, either as customers or as possible representatives. Each company representative earns their money through honest work. They may receive commissions for selling and may also receive a bonus for offering the business opportunity to others.
The truth is, all organizations are in face pyramidal in structure. Most of the staffs are controlled by a few people high up in the structure such as the CEO and managers. The difference is that, distributors in a MLM company are not controlled and do not need to report to their superior.
With an MLM, you can build your business as large and as profitable as you want and you do not need to be at the top. In fact, with many MLMs, you can surpass the earnings of the person that introduced you to the business.
It is sometimes difficult to differentiate a honest mlm scheme from pyramid schemes because of the many similarities in structure. But the main difference is that pyramid schemes earns money from you when you join, but mlm schemes lets you earn money through the sale of products and services and not primarily through recruitment of new members.
Pyramid schemes are not sustainable as there is a limit of people joining the network. In most cases, the bulk of the members in a pyramid scheme will lose money and time, while the people in the top of the structure profits the most.
People commonly mistaken MLM companies for Pyramid schemes. But in a good MLM company, you will only be rewarded if you work hard.
The main objective of an MLM is to enlarge the area of distribution for different goods by involving as many people as possible, either as customers or as possible representatives. Each company representative earns their money through honest work. They may receive commissions for selling and may also receive a bonus for offering the business opportunity to others.
The truth is, all organizations are in face pyramidal in structure. Most of the staffs are controlled by a few people high up in the structure such as the CEO and managers. The difference is that, distributors in a MLM company are not controlled and do not need to report to their superior.
With an MLM, you can build your business as large and as profitable as you want and you do not need to be at the top. In fact, with many MLMs, you can surpass the earnings of the person that introduced you to the business.
About the Author:
MLM Absolute is an online learning platform for all MLMers, Network & Internet Marketers to be equipped with the right skils and attitude to excel in this business. To know more about MLM, visit MLM Absolute
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