MLM Networking Women

Most people often mistakenly lump Multi Level Marketing (MLM), Network Marketing, Affiliate Marketing, Ponzi Schemes and Pyramid Schemes together as one big group of scams.

In reality, network marketing, MLM, and affiliate marketing are different and usually legitimate business opportunities.

Whereas Ponzi Schemes and Pyramid Schemes are illegal scams designed to make the person or people at the top rich and rip off everyone else.

In the MLM industry, a person still has to be careful in choosing an opportunity to join.

Not all businesses are designed the same and not all contracts and policy and procedure are created equally.

It is vitally important that a person understand what makes a company a strong business opportunity for the distributors. 

At Mentoring For Free, we use the Five Pillars and the $10,000 Question to measure an MLM company’s strength.

Whatever yardstick you use to evaluate your company or a company you are considering joining, you must understand what would make it a scam.

How To Identify A Scam

An Attorney General would ask these two questions:

1. Would a logical thinking person pay this much money for the product or service if there was not a business opportunity involved?
2. Does the income stop when the recruiting stops?

If the answer to the first question is “No” and/or the answer to the second question is “Yes”, then it is a scam.

The word SCAM
brings up Ponzi schemes and Pyramid Schemes.
They are similar and different.

A Ponzi Scheme usually targets more affluent people referred to as “investors”.

A Pyramid Scheme targets more of the blue collar section of society.

They are both illegal and designed to rip people off while making the guy(s) at the top rich.

Rod Cook of MLM Watch Dog wrote an excellent article about Ponzi Schemes and Pyramid Schemes.

Take the time to read it here: Pyramids and Ponzi Media Reporters.  At the end of the article is some interesting history about Carlos Ponzi.

As Rod says, “A good MLM provides goods or services that a consumer would buy if an income opportunity were not included!”

Believe In Your Success, I Do!
Karen
mentor.karen.j.miller@gmail.com

When you first got into MLM, I’ll bet you were like most people.  You were new to the industry, had no formal training, blindly believed your upline sponsor and trusted your company’s leadership implicitly.

I’ll bet you never thought about distributors having…or being entitled to…a Bill of Rights.

I’ll bet you never thought that there was an MLM Distributor Rights Association or that there was a Network Marketing MLM WatchDog.

Now that you’ve been working your business awhile and probably have some questions, you may not know quite where to turn for answers.

The MLM WatchDog, founded by Rod and Marcie Cook, is a great place to start.

Rod & Marcie have dedicated their efforts into making sure the MLM industry gets fair representation.  They are also committed to protecting their readership from being scammed.

I have included below the Distributor Bill of Rights as found on the MLM Distibutor Rights Association.

Read it carefully.     

 

Distributor Bill of RIGHTS

1. Distributors have a right to own and operate their own independent contractor business. The company and the government should recognize that a distributorship is an independent small business with all of the rights and tax benefits of any independent small business. By entering into an agreement with any company, each Distributor is entitled to specific and undeniable rights to protect and preserve immediate and long-term residual income.
2. Distributors’ personal business relationships shall be honored and protected. Distributors’ downlines that are personally sponsored and personal retail customers are part of the distributor’s business. Companies will recognize the sacred nature of the sponsor/distributor relationship. Distributors have the right to expect company’s efforts to support and sustain that relationship, and do nothing to compete with or harm the Distributors business. No restrictions should be placed on any legitimate business relationship, regardless of a competing company being involved or not.
3. Product usage by a distributor’s personally sponsored downline and customers is considered as retail sales of that distributor and is commissionable. The use of the company’s products within the sales organization is called “internal consumption.” Whether a distributor or a customer receives a discount is immaterial, as in the case that factory or wholesale outlet sales are still considered as retail sales.
4. Distributors have a right to a fair and balanced contract. Distributors shall be protected from termination without just cause. Distributors have a right to automatic renewal without material breach of contract. Distributors have a right to a process and system of fair and independent recourse.
5. There cannot be any restrictions on the distributor’s spouse or family conducting any other legitimate business of their choice. The company has no right to condition their distributors’ business based on any third party that is not a signature party to the independent contractor agreement/contract. Such attempts may be illegal.
6. Distributors have a right to sell, transfer or will their independent contractor business to any party that would qualify as a distributor under normal conditions. This is a provision that also helps protect the independent contractor status.
7. Distributors have the right to expect that their company and employees be honest and treat them courteously and respectfully; and submit to likewise treat them with mutual respect.
8. Distributors have the right to expect that their company has taken all reasonable steps to insure that their products are properly represented and meet any and all legal standards, have taken all reasonable steps to protect the proprietorship of the products and they are shipped in a timely manner.
9. Distributors should have the right to join any legitimate association of their choice.
10. Loyalty is expected from both Distributor and Company to each other.

Does your company’s contract and policy and procedures follow the principles in the Bill of Rights?

Have you even read your contract and policy and procedures?  If you have, do you understand the legalese?

Do you fully understand what could happen to your business if your company has a termination clause, or some other clause not in concordance with the Bill of Rights?

Who owns your downline (aka “your list”)?  If you left your company, are you allowed to contact your downline to introduce them to your new opportunity?  Or will you get sued?

These are questions you have to have answers to.  It means the survival of your business…the one you’ve worked so hard to build.

I can help you find those answers. 
All you have to do is ask.

Believe in Your Success, I Do!
Karen
mentor.karen.j.miller@gmail.com