Sale multilevel or mlm, that employs him, relationship marketing, marketing multi-level sales network by cooptation, co-opted network (V.R.C.) sales, network marketing, etc., in English multi level marketing or MLM, is a structure of the sales network in which resellers (or distributors) may sponsor new vendors, and be so partly paid by a commission assessed as a percentage on sales of recruits. Sale multilevel eliminates the costs of recruitment and training, but also advertising expenses by substituting the word-of-mouth.

The multilevel sale itself was invented in the United States in 1940 and popularized in the 1950s by the Tupperware company. The multi level marketing (MLM) is present in almost all countries.

In france, it is legal

The law allows sales networks by recruiting in string of members or affiliates (not to be confused with the pyramid) 1, ^under certain conditions.

Thus, a legal network shall comply with the following constraints:

• "godchildren" commissions are levied by a number restricted and fixed hierarchical levels, so that there be no hope financial gains resulting from an unlimited increase in the number of persons recruited or enrolled.
• no benefit shall be conducted during recruitment, even in a roundabout way (training, non reprenable initial stock).
• Commissions are subordinate to the sale of a quantity of products or services, either to the acquisition of new customers.
• Stocks must be recoverable

https://www.legifrance.gouv.fr/

The federation of direct selling (FVD) organizes and federates the multi-level sales. Members are the companies at the first level, but it also assists sellers.

Vendors may obtain a status of vendor independent home or an independent status and since 2009 opt for auto-entrepreneur status.

Where the activity is occasional and within the limits of a certain income ceiling, they may have the status of employee social contributions are paid by the parent company. The seller then depends on the general social security scheme. Vendor activity can be considered as falling within the micro-enterprise when he has independent status and that the turnover is less than the tax ceiling.

The seller shall issue a purchase order with its coordinates and its supplier; It must meet the deadline of seven days of its customers. The status of independent home (VDI) seller is status of salaried clerks and society is responsible for his actions in trade when it represents; This status is not suitable for vendors having a product or service to high commission (as in real estate, for example) due to the lower turnover still limit for auto-entrepreneur status.

Direct selling is often presented as an alternative or a plan B financial that may remain at the stage of revenues supplementing the purposes of months, or can become a viable career plan.

What the law says

Code of consumption «art.» L.122 – 6 – shall be prohibited:
"The sales process said the snowball or all other similar methods of in particular to offer goods to the public in him doing hope obtaining such goods free of charge or against surrender of a sum less than their real value and in making sales to the placement of vouchers or tickets to third parties or to the collection of memberships or registrations."

It is forbidden in a MLM pay money for the recruitment of new members. It is important to understand that in a mlm pay must be given "only" for the sale of products and services. Any premium non-contractual, not specified in your plan of remuneration received for the entry of a new Member in the Organization, is potentially illegal. Any premium received for the purchase of product by the representative itself, can be considered a "hidden discount", and can bring the taxing authority as straighten you fiscally. Any premium charged to other title that the sale of products to final customers, it means to others that your downline or members in the system, group or individual can be considered to be hidden and non-contractual remuneration and therefore subject to social security contributions. And in the latter case, it is essential to understand that adjustments can be extremely devastating for your business, for your finances.

Generally, the act very strictly framed system "bonuses", which must remain "exceptional". If the uniqueness becomes routine, it is potentially illegal, because non-contractual. What's serious here, it's the MLM business that will make you directly or indirectly to do so not in is never liable for, as your independent status, it is your sole responsibility to comply with the law. It is up to you to know if what you're doing is legal or not, and not the company to interfere in your management to ensure. It is even more perverse that the company has a blatant interest, and that it has an obligation to provide information on the subject. But these information are often very diffuse, buried in lengthy contracts written in small print that most people don't read ever, and in legal language that you will have the greatest difficulty to understand.

regarding the purchase of stocks

Some MLM do you buy large quantities of products so you do the resale. But it is very likely that you will not succeed to sell all products. Therefore in this case the MLM subject reimburses you unsold products.

Act No. 95-96 of 1 February 1995, J.O. February 2:

"In addition, it is prohibited, in these same networks, to obtain a member or affiliated the acquisition of a stock of goods intended for resale without guarantees of recovery of the stock to the conditions of purchase, possibly of a net sum not exceeding 10. p 100 of the corresponding price. However, this guarantee of recovery may be limited to a period of one year after purchase. »

Within a period of 12 months from your product order, and if the product is in good condition for resale, you can return all or part of the purchased products through their refund up to 90% of sums paid. MLM cannot oppose under penalty of heavy sentences, or even an outright ban. The threat of a complaint is usually enough to get satisfaction. The premiums are generally not contract with these companies, they cannot be justified by actual sales to final customers, and therefore cannot be deducted from your refund. A premium is supposed to reward you for your performance, not because you buy you even a lot of products. In this case, it is more of a "premium", but a gracious discount. And in no case it should be submitted otherwise, would be for accounting, social and fiscal reasons.

starter kits or the products

If a MLM offers to buy a Starter Kit, it is important to check if the purchase of this kit reports profits to the other members of the network. The Act allows the MLM offer a Starter Kit to participate in the system. If this kit contains products for sale, it must be evendue at cost price. If this package contains no products for sale, this kit should be given without charge. Membership fees are not expected to cover the price of said Kit, but the administrative costs of your membership system. The company for legal obligation to provide all or part, and without any financial compensation, the means of sale in order to complete the sale of its products – and especially in the case of exclusivity, franchise or distribution under duress. In other words, the training and personal development aid must be free, cannot be sold in any way whatsoever. In no case it must make a profit or you force them to fund its own POS (point-of-sale advertising).

Act No. 95-96 of 1 February 1995, J.O. February 2:

"In the case of sales networks consisting of recruitment in string of members or affiliates, it is forbidden for a member or affiliate network a sum corresponding to a right of entry or acquisition of materials or services to educational, training, demonstration or sale or any other material or similar service, when this payment led to a payment or the granting of an advantage benefiting one or more members or affiliates. of the network. »

In other words. Any tool for sale, PLV on products, training, websites, etc., must not be sold to the representatives, if this allows the company or representatives to make a profit. Number of promoters MLM do not hesitate to sell you individual training to help you supposedly to "perform" better. To avoid this condition, they do generally personally, with a different legal structure, although often, in violation of their own contract with the company. So check that their activity is well legal and authorized, and check that these courses are useful, you will actually bring an increase in your sales. Anything related to personal development has nothing to do with the sale of your products. And it should logically be the responsibility of the company to bring you free all these programs and information, because his goal is to sell products, and not to exploit your naivete. Force is found in the middle of the MLM, everything sells, even what should theoretically be free.

Law on competition «art.» 55. : Pyramid:

'Article 55 (1) (b) prohibits the CMPs in which a person must, to become a participant, provide compensation for a given quantity of a product. This provision also prohibits the CMPs in which participants must purchase products to receive a commission or higher profits. However, it allows the purchase of products at cost by a participant for promotional purposes. Therefore, a system could raise no problem under this provision if a new participant was required to purchase a "Starter Kit" (manual, instructions, product samples, promotional material) at cost plus handling and shipping expenses. the Commissioner will take into account the fact that a significant part of sales are made to individuals who do not participate in the system because the lack of such sales could indicate that there is indeed an obligation to buy and thus raise a problem with regard to the provision. The Commissioner is believes that an obligation to purchase may be contrary to the provision, which is not the case of an obligation to sell."

This provision provides that a multi-level marketing system is a 'pyramid scheme' illegal when participants receive remuneration for the recruitment of other participants, they must make some purchases to participate in the system, they must get unreasonable quantities of products or that they are not a guarantee of redemption on reasonable commercial terms. » .

Contrary to what is claimed by some proponents of the MLM, pyramid selling excluded nothing the issuance or non-products. In the case of the MADOFF case, it was clearly of 'products' financial investment. And in the case of the MLM recruitment or product, the sale of product exonerates nothing illegal pyramid shape. This deception is all too often used by these representatives of MLM to deceive your vigilance, a pure lie. It is also indicated that the "Starter Kit" may consist of equipment to aid in the sale, and therefore, may consist of demonstration products, they cannot be sold at cost price. At no time the acquisition of this Starter Kit is a "duty". In other words, you can totally adhere to the system without having to buy this kit, or demand repayment at any time. Similarly, any progress in the hierarchy of your compensation plan may be hampered by no other constraint than the sale of the products, and not vice versa. Far too often, and especially in the MLM recruitment, progression of your income can be done only by recruiting new people, not by significantly increasing the volume of your sales.

Network marketing income

In different network marketing companies, there are generally two types of income.

• commissions: the independent representative enjoys a margin;
• residual income: is called residual income (or active or passive, yet income annuity income recurring or income non-operating) income that is paid on a recurring basis. It is calculated using personal turnover of the representative and that of his organization, according to the compensation plan of the MLM company with which the representative works.

The independent representative can also benefit, under certain conditions, premiums (to be encouraged).

The real problems of the MLM

Multi-level marketing suffers from a problem of image recognized due to the fact that it is often difficult to distinguish legitimate MLMs and illegal scams. MLM companies operate legally in the United States and in 50 States and more than 100 other countries, and new companies may use terms such as "affiliate marketing" or "home franchise business". However, many pyramids try to present themselves as legitimate MLM businesses.

The problem of scams

Marketing network, or MLM, knows success growing for a long time now, since one can speak of decades. Unfortunately, it also suffers from a bad image, related to the fact that many people confuse the system of network marketing with that of the Ponzi system, that is a scam. 'Real' network marketing has absolutely nothing to do with the Ponzi system, nor with a pyramid scheme. The problem is that some people have made Ponzi type scams in the past by disguising them as network marketing; There are still my see scams. To put an end to this mix, but also to ensure that you are well informed and can make things if you want to get started in network marketing activity, I will in this article explain you precisely what is a Ponzi scheme system, and how recognizing it compared to a multi-level marketing system, which is reliable and legal.

reminders on the ponzis:

This system is so named because its inventor, Charles Ponzi. This is a very old scam, since he used it for the first time in 1919.

The operation of this system is rather simple: it comes to convince people to invest, promising them generally an interesting ROI, then pay them, but with the money invested by the following clients! The big flaw of this system is that it can not hold in the long term. Assuming that person discovers the deceit before, system always ends up collapsing itself, since it happens always a moment where there is enough new customers to "Finance" the remuneration of the former.

What is the difference between the scam that is a Ponzi scheme and the MLM System?

In network marketing, there are two activities that are exercised in parallel: the sale of products and the recruitment of downline to build its network. There where some tend to make an amalgam with the Ponzi system, it is on the recruitment of new referrals. The Ponzi scheme is therefore nothing other than a real scam, an illegal scam.

In network marketing, commissions that you touch are calculated on the turnover of your downline, but payments are made directly by the company, and are in no way taken referrals earnings. It is this difference that makes the MLM an activity which is, on the one hand, fully legal, and on the other hand, totally reliable. Thus, each Member of a network will have to equal activity, exactly the same income.

For example:

1. If the commissions you'll touch 'on' the turnover of your downline, correspond to amounts deducted directly on the earnings of these referrals. It a Ponzi system.
2. Always beware of too enticing offers: the famous too good to be true is often… really too good to be true. If for example, we offer you to buy a revolutionary financial product that will bring you 20% without risk of interest per year, flee! If it is, it is a scam. In my section scams we have products that are 70-1800% annually. Generally, when you want to invest, do extensive research before, and do not hesitate to seek advice from financial experts etc.
3. About network marketing, never enter into a system which will require you an initial investment! The company that sells lingerie at home and that for example asks you to buy a "starter kit", promising you a then guaranteed minimum remuneration, is also to flee like the plague. If there are products to sell, it is the company to provide you any samples. otherwise it must take back you the stock.

How to check scams:

To protect themselves from this type of scam, in France there is the Federation of direct selling. Go to the partner of the FVD pages to check companies. It exists since 1966 and was founded by large companies of direct sales at the time, to formalize this activity and crafts relating thereto. Any company marketing network (or direct sales) has the opportunity to become a member of this federation, and to do so, it must file his candidacy, which is accepted only after a thorough investigation conducted by professionals precisely to determine that no Ponzi or pyramid system not behind.

Attention however membership is not compulsory for example you can find companies that use mlm as crowdimo but are not members, but yet these companies are legal. If it comes to corporations in the field of finance for example, it is possible that they are not members of the FVD simply because it is not the sale of goods. This does not mean that it has illegal practices.

Some examples: cetelem, franfinance are members of the FVD.
Legal does not mean necessarily bargains. The weak points of the MLM.

Bad MLM techniques

How many times have you been approached by a neighbor, colleague, friend, or worse yet, a member of the family, who said "Let me give you an incredible opportunity" and you are then invited to a house or for lunch for "a debate". Another variant or "I have a friend who".

Most people immediately have this feeling that there is a wolf.

"Is it a multilevel marketing organization or a Ponzi scheme".

Maybe you know someone who, at one point to sold Amway, Herbalife, Mary Kay or other health supplements or cosmetics. Generally, they will tell you how much money they earned but not how much they spent and how they have been obliged to sign new "distributors" or make sales under penalty of losing their mandate.

The problem of the saturation of the market or how you will struggle to find customers

The saturation of the market can be defined as the point where all the people who want the product at the price where it is sold already bought it. No product or service will meet 100% market penetration, since everyone does not necessarily the product, or is not able to pay (beautiful luxury car). The fact that multi-level marketing plan is based on a network still growing distributors, each of which can pay fees, buy products and / or recruit more "distributors" will eventually lead to the fact that not everyone can work because sellers are over-represented compared with the demand of the customers. If the company truly works in MLM, not franchises, so you often have to deal with this problem, it does parrait nothing but it is crucial.

How is determined the point of market saturation?

Now, if everyone could use a new product or service, everyone wouldn't. Some will be afraid to use something new. Others will be existing brand-loyal. Some will want to buy a product of inferior quality for cheaper or on the contrary customers may want a more expensive premium product for prestige.  It n so there will only be customer X.

The question for the future specialists of marketing is… who is 'X', and how this variable can be predicted to maximize profits? The fact that "X" is difficult to define does not mean it does not exist. The market wants that "X" is equivalent to a number of products at $100. What will you do with your additional stock sales in the past "X" and that nobody wants?

No one can perfectly predict 'X', and the situation isn't as simple as reporting, but the objective of marketing is to provide "X" and make sure to convert prospects into customers.

Let's look at an example:

The population of the United States is about 300 000 000, and say that you want to sell a new type of BRA; Obviously, women (and a few transvestites) will want to buy a.
300 million people, there are about 110 million people who are adult women. If you sell the BRA at $45 each, you can eliminate most of the women who are in CSP low-income; You now fall to 50 million potential customers. Then there is the style. Even with a very popular style may not appeal to everyone, so 50 million potential customers, probably half want enough to buy it. Therefore, we can reasonably say that the potential maximum size of our market for the designer of Rihanna arm will not more than 25 million women out of a total population of 300 million people in the United States. This represents about 1 / 10 of the population, even for something as popular as a bra.
Similarly, everyone does not wish to join a club, buying gold, use high range cosmetics, drinking filtered water, wear a particular style of footwear, or using any other product or service.

For example, if the company Apple, based on the experience of the last year, believes that they will sell 10 million phones next year, they plan to build and distribute accordingly. This means prepare factories, set up a distribution channel and a network of dealers, advertising and marketing campaigns and carefully manage inventories at each level so that Aplle will still have credibility with their distributors, retailers and the public the following year, having enough to meet the demand without being in excess.

If it turns out that there is a "run" on the products of Nespresso, and they achieve their goals of sell mid-year so they have miscalculated demand and he will miss the benefit they could have done easily. The most serious problem, however, comes by overestimating the point of saturation for the product. If these companies are 10 million products and sell 2 million, it may be the end of Nespresso / Apple etc as a society, because the surplus will have passed for a fraction of the original price.

The obvious point here is that the management of supply and demand, and it takes a good dose of insight to predict a realistic market penetration and know the saturation point is crucial for any company, for any product or service. Execution on this plan and the calculations and careful management of all aspects of manufacturing, distribution and advertising and marketing is essential to success. Simply said, a failure of supply and demand can ruin a company if the market is oversaturated.

What is the problem with MLM and the saturation of the market?

[sociallocker]

Balance the offer at the request of the market is the key to success of a company. Interestingly, the issue of supply and demand is what led the USSR to knees. By design, the Soviet Government tried a macro-management of the offer where the bureaucrats decided how many potatoes are needed, how many paper toilet, etc. assuming these bureaucrats did the best they could, their efforts to deliberately manipulate supply and demand was not good enough. Despite their good intentions, their assessments were generally false, which created huge shortages and surpluses, and led to a massive economic collapse, because resources are entered in production of products which were not necessary, while other products were too limited quantities.

With MLM, the situation is much worse. No one is at the controls. Even the Soviets had someone to say from when it was enough! If the bureaucrat in Soviet Russia tried to play Adam Smith and his 'invisible hand' in the Soviet Union

MLM is implemented by a design to the fishing expeditions which exceeds the saturation point and attempts to continue to move forward. He will grow until it collapses under its own weight, without even noticing. MLM is like a train without brakes and no engineer who runs and that dark full throttle to a terminal.

Why?

Simply because in MLM people are commercial, independent and that if the company recruits 1 000 this not cost almost nothing.

[/sociallocker]

The lies

Everyone will want to buy this product!"

Who has an eye on 'X', the point of saturation of the market for price given in an MLM? Well, person and what is funny, or perhaps tragic is that the saturation point will be reached and even exceeded, without anyone noticing or take care.
Let's just to assume that it has been reached today in a MLM; the number of possible units sold at this price has been exceeded. Is – that someone cares? Since we assume that the number that allows the saturation of the market 'X' has been reached, everyone who wishes to become a client of the MLM it is now. But this is not what the speaker will say. It will tell you "now is the right time to join us, on to a super year, imagine next l´annee." But all this is a lie, even if the speaker does not know. The total available market "X" has been reached and nobody notices. All distributors will lose from now on. Could this be you? How can you possibly know how you'll become a liar in an MLM

Example

Imagine McDonald's suddenly convinced soi "since everyone needs to eat', we open four McDonald franchises on each of the four corners of an intersection in your neighborhood. In a few months, the four points meurts to a slow death. The franchises there would think twice before doing business in this way. This is why in the real world Concessions and franchises are contractually protected by defined territory and / or market, and only allow not too many distributors in a given area.
Again, the simple fact is that even the most successful products will have a partial market penetration. This is also true for services.
Then why the MLM promoters hide this?
Where is the stop in an MLM if enough sales people are hired? In a normal business of a Manager said: "we have enough, stop hiring people.". But in an MLM, there is no way to do so. There's never enough or too many "distributors" or sellers. Out of control by its design, its gears will grind the money, time, credibility and the entrepreneurial energy of well-intentioned people who joined simply to supplement their income.

The lead becomes too hard:

Due to the saturation of the market and competition, the lead becomes hard and costs increase, as Word-of-mouth is too long and it is difficult to sell, rare are the people arriving in MLM.

Other low points:

• The products offered are often unmarketable products (or hardly). You can make a few sales, but from there to implement a system that pays you a regular profit, it is all another story!
• Must pay the "starter Packs", or this kind of thing with another name who wants to say basically "If you want to start, should pay the right to enter"! For some MLM, its runs squarely at the subscription or the Ponzi scheme. Need to pay every month a small amount to stay in the circuit and continue to hit profits from its godsons, for example. If you do not pay, you are no longer seen as 'active' and strangely your self-help group more as much help you. It will make even you resume a small Pack.
• It is a vicious circle. People who are in this system will never tell you "it is scam, do not go!", because they would then lose an opportunity to recruit you and therefore resume their investment. Remember, the goal is to recruit and sell as possible!
• Many sales or recruitment methods are obsolete, and this is the error. You have tools, sometimes even a website with your Member nickname, but the site does not pro (nothing that from a Visual point of view, it seems that the date of 10 years ago!).
• Level compensation, this is not it. The commissions are rather low and in light of the tremendous work that awaits you, it's very little paid.
• It is above all a commercial business, we need to go quickly

The strengths of the MLM and benefits

What distinguishes the MLM from most other trade it is that by creating your networks you power this enormous fire.

• Be able to engage in the sale without too much risk. Products already exist, you will only have to promote a. No cost of production or complex sales process. You are just Distributor.
• You are generally not single. You join a community of other sellers like you and who will give you some tips to help you and start you. They have every interest in help if they want to be paid them also (explanation on the following point).
• You have the possibility to sponsor other persons, on several levels. You recruit other sellers in your team and you will earn a share of their sales. Practical when the number begins to grow.
• You have tools to promote your products, as well as explanations on the different way to sell. The team that has hired you will also make you benefit from their experience, and they are fairly well organized (from what I could see when I tested this method).
• The pay is often capped.

Sellers who already have experience in MLM are often a big plodders or /et have a book in gold. These are often self-employed with advantages and disadvantages. They are used to provide a large work for little results, and are therefore hard to get by. Imagine now if you have a business, and that you call a friend who is in MLM. You propose not not crumbs, but profit sufficiently interesting to him, if he do the sale of your product… You see where I'm headed?

Doing the same job it does in normal times (networking, promoting etc) he will win perhaps 10 times more and you, you'll have a seller who knows perfectly the strings from the sale. Everyone finds his account, and it is for this reason that a product offered in affiliation is far more cost-effective than a system that sells little-known products and low commission rates.

The commonly used articles.

The home sales (APE 47.99 code A), employs large numbers of sellers. Member of the Federation of direct selling companies (information for the articles come from the site) accounted for only 300,000 people.

The profession of home seller fits into two large existing social categories:

Employees, persons bound by a contract of employment with the company

• non-statutory representatives
• statutory representatives (VRP)

The independent, people bound by a distribution agreement with the company

Independent direct sellers

• VDI agent
• VDI buyers/resellers

Enrolled in a professional register

• commercial agents registered in the register of commercial agents (me)
• traders registered with the trade register

The direct selling, it is also articles varied and suitable for all sellers, whether they are employed or self-employed.

 The VRP

The legal status provides a number of provisions which apply ipso jure to the VRP and to which the contract of employment cannot derogate.

 Commercial agent

The criteria to verify before engage you in a MLM

Before venturing into any MLM company, here are some essential conditions to which you must absolutely be attentive:

1. Make sure it is not a Ponzi scheme
2. A solid management team that was behind it, several years of success in the MLM industry.
   They know how to combine and develop a perfect opportunity both today and for the next 10 years to come.
3. The company has great products 'Very popular' today and for years to come.
   High quality products, providing great value added to the final consumer (this is very important)

4. A company offering products with the buying and selling price is competitive compared to similar quality products, offered in the traditional distribution.
   The price should not be a hindrance. If you consider it expensive, the people to whom you propose will find it definitely too expensive.

5. A compensation system easy to understand and to explain which is especially advantageous for distributors.

6. An efficient and easy-to-duplicate marketing system. Effective training for beginners, presentation systems, allowing you to develop quickly. Ideally the company gives the lead.

7. The possibility of using internet as a means of recruitment. If the company limit you in your marketing efforts, then you better change quickly.
   More you freedom in your way of managing the business, best in your results.

8. A company in full expansion, developing rapidly and globally, the rate of attrition (the number of distributors is disengaging) is low…

9. A company where it is possible to earn money. A large number of distributors exceed the monthly commissions EUR 2 000.

9. Look also at the number of distributors that are thrown out (which it withdraws the mandate) because often this traffic stats with for example 15 hired 5 remaining. Look at the objectives.

Before start you breaking the myths:

1 – MLM, it's easy.

No this is not true, the MLM is simple in concept but not more.

Forget the promises of the kind "win €5,000 per month by working two hours a day!". A full time seller can expect to earn the minimum wage. But working that one or two days a week, you do exceed hardly the €400 per month.
The average annual turnover by a seller at home working on a casual basis in 2010 amounted to €6 030, according to the European federation of direct selling associations (Seldia). It is therefore more of an income supplement, Martin "where the goal is mainly to have fun," testifies.
Senior citizens arrive in number on this sector: in addition to completing their retirement, direct selling provides a supplement of conviviality and socialization. Vendors – women, 77 percent – are 90% part-time multi-level sales.
More revealing still: it is commonly accepted that 97% of people who engage in multi-level sales drop quickly.
A figure due no doubt to the promises of easy money, who are confronted with the reality of work.
For Jacques Cosnefroy, it is also due to the fact that more than in any other sector, anyone can try his luck: "80% of sellers had never been trained to trade before! So, it is a chance for them. As for those who succeed in earning their living, it is not uncommon that they then move to entrepreneurship".

2 – Just talk to 3 people and you'll be rich

No, we must speak of thousands of people to be rich. This is the big problem of the beginner and his address book.

A fact remains, to build your business MLM, it is necessary to create relationships, it is not for nothing also known as MLM, relationship marketing.

3 – In this MLM, one becomes rich without recruiting

Wrong, it is a myth. It does not exist.

Recruit a Godson can not be paid: the commission cannot take place on the sales of the latter. Because the goal of the company is to sell its products. This is where the issue of the status of Sponsor: If the Godson is not correctly formed, it will sell little, or not at all and will not generate or turnover business, nor commission. Recruit a friend therefore requires a very significant personal investment: we must train them, support it, motivate him… This represents a true team leader job, which is not within the reach of all.

4 – I'll help you to do anything, just sign the contract representative

Only the contract representative interested him.

5. in MLM, you don't need to recruit, just do reviews…

You cannot do millions of customers to you alone.

But a good network must allow its sellers to live exclusively of sales activity. "It is essential that in an MLM, the seller has the possibility, if he wishes, to simply remain vendor, without being obliged to sponsor other"

In general, commissions are between 25 and 35% of the price of the product, some up to 40%.
«That being said, a commission of 15% on a very easy to sell product can earn more revenue than a 40% commission on a product difficult to place,

6 – You don't need training in MLM, everyone can do

Flee everything simply. Everyone can not do MLM because everyone may not be commercial. That's why there are trainings. It takes a certain profile to succeed and the desired profile is (drum roll) contractor…

7 – You will have financial freedom in less than 2 years

My opinion: false, may be will you begin just to earn the minimum wage in 2 years.

8 – My MLM company is the best.

My opinion: this is the kind of person who believes.

9 – Use your friends and your book for your first sales

Your friends and relatives will tend to accept your offer, for you to please or to have peace if you have the chance, because if even they do not, who will accept? If they do not accept your address book is useless and you won't be able to start. But often they do not accept because they want you to do your evidence.

The beginner has no book is going to have.

10 – We offer the best training in our MLM business

My opinion: idem

11 – With MLM, you will become very rich very quickly

No, the MLM is not a way to get rich quick… sorry. review highest point

Recruit a Godson can not be paid: the commission cannot take place on the sales of the latter. Because the goal of the company is to sell its products. This is where the issue of the status of Sponsor: If the Godson is not correctly formed, it will sell little, or not at all and will not generate or turnover business, nor commission. Recruit a friend therefore requires a very significant personal investment: we must train them, support it, motivate him… This represents a true team leader job, which is not within the reach of all.

Nevertheless forget the promises of the kind "win €5,000 per month by working two hours a day!". A full time seller can expect to earn the minimum wage. But working that one or two days a week, you do exceed hardly the €400 per month.
The average annual turnover by a seller at home working on a casual basis in 2010 amounted to €6 030, according to the European federation of direct selling associations (Seldia). It is therefore more an income supplement, "where the goal is mainly to have fun", reflects Sylvie C.
More revealing still: it is commonly accepted that 97% of people who engage in multi-level sales drop quickly.

12 – Just sign 2 people who will sign 2 persons each and you will be millionaire

Life is not as beautiful… sorry. Otherwise my sponsorship crowdimo list would already have 200 investors and not 15.

13 – I'll put a system in place for you, just sign the contract representative

Ask to see the system before signing (just in case).

14 – You didn't need to recruit, there will be overflow anyway

If everyone expects the overflow, there will be no overflow in the end…

15 – You are not good in recruiting, just make customers

We already talked about it, is not it? You must find a way to become good at recruiting and good sales, especially on sale. It therefore remains an almost true assertion.

16 – It's easy to find potential customers or clients

Sorry to disappoint you, but this is false. It is even the most difficult part. Otherwise everyone would be rich, isn't it?

Be aware that it must often have the cash, lots of cash especially in the beginning to buy prospect list…

About sponsorship

The issue of the status of Sponsor: If the Godson is not correctly formed, it will sell little, or not at all and will not generate or turnover business, nor commission. Recruit a friend therefore requires a very significant personal investment: need to form it, support it, motivate it… already that find the Godson is difficult, then in addition it is necessary to train them and that he abandoned (97% dropout)

Then the client finally found, all "Networkers" can testify: "is a crazy time trying to convince customers that the multilevel is not a pyramid scheme. Time to justify that the box is. Because, if the "Multi level marketing" is perfectly legal, the system pyramid, them, are prohibited in all the countries", says Jacques Cosnefroy, Federation of direct sales.

And lastly is for sale.

17 – You can combine several MLM

Yes – Not on the paper, you can combine several MLM. But is it really feasible to organize meetings of sale for 2 companies? To train for 2 product catalogues? And would that be consistent? Tupperware Wednesday, Herbalife Saturday… Hum it's average. After there are 2 additional companies of course. In finance difficult to 2 or more (real estate and credits and insurance) products.

18 – You can work with who you want!

Wrong! In MLM, you work with those who are willing to work with you! It's so hard to recruit in MLM, that is not really choosy to say: «not him I do not take it because it is not a leader. If you choose really with which you are working, in 10 years you will always have 3 or 4 people in your network. Even your friends are difficult to convince, because they know that work you not long and wait for the evidence, who can never come because you are unable to sell.

19 – You can work from anywhere in the world!

There again, this is not really realistic. For a simple reason: in traditional MLM, it is you who deliver your customers. So you must be present in a country where your company is present. But you must also be present where your customers are present (it is better to organize sales meetings). So forget the Kenya savanna or Amazon…

20 – You can work when you want!

This is rather true at first sight. If Thursday afternoon you do not work, you have no obligation to do so. But do you mean that you are going to gain anything this day, insofar as your income the first years are active income, and not passive income. Sales meeting no = no money. No recruitment maintenance = no development of the activity.

The average annual turnover by a seller at home working on a casual basis in 2010 amounted to €6 030, according to the European federation of direct selling associations (Seldia). It is therefore more an income supplement, "where the goal is mainly to have fun", reflects Sylvie C.
Senior citizens arrive in number on this sector: in addition to completing their retirement, direct selling provides a supplement of conviviality and socialization. Vendors – women, 77 percent – are 90% part-time multi-level sales.

21 – It's 100% passive income

I just talk about the multi-level affiliate saying it wasn't easy, as the traditional MLM. The difference is that in the membership, it's a true passive income. In traditional MLM, it is in large part from the active income, it means that if you stop to go on vacation, you do not touch the money. It takes years to have a passive income, and more if you sell more, you lose your mandate and the company pays you more your affiliations so you lose your passive income (contracts are often of 1 year).

22 – You have absolutely no expense in your activity

Okay, this first point was rather a lie of crooks

When we recruit, there is often a service brake: the initial investment, and yes the car gasoline rent etc? It's not free.

Instead it should be a maximum of liquid: for your expense to buy the list of leads for your business and as you sell less experienced someone need even more money. More by (often independent) status, we have beautiful receipts.

23 – You have no need to sell or recruit

It is downright anything!

Conclusion:

An interesting and powerful system with its flaws and its advantages and a clearly commercial trade.

Notes and references