Wikipedia (as of Apr 29, 2008) has interesting articles showing clear contracts between legal & sustainable
multi-level marketing schemes and illegal pyramid schemes.
In short, pyramid schemes just transfer money from large section of participants to a small group of top ones.
MLM schemes on an average sell you the products at retail price minus the advertising costs. All else in it is pyramid.
Federal Trade Commission, US, advises that multi-level marketing organizations with greater incentives for recruitment than product sales are to be viewed skeptically.
Since many are still falling prey to these, esp. in the "free" market world, we owe it to spread this info and forewarn others.
Keywords: ACN Inc., Agel (MLM company), Alticor, Amsoil, Amway, BioPerformance, Cobra Group, Deutsche Vermögensberatung, Equinox International, Excel Communications, Forever Living Products, Freelife, Fuel Freedom International, Fund America, Inc., Herbalife, Holiday Magic (Company dissolved in 1974), Juice Plus, Kleeneze, Mannatech, Mary Kay, Mini IQ, Monavie, National Safety Associates, Neways, Nu Skin Enterprises, Omegatrend, Oriflame, Pre-Paid Legal Services, Inc., Primerica, Quixtar, Shaklee Corporation, Stream Energy, Sunrider International, Tahitian Noni International, USANA Health Sciences, World Financial Group, XanGo
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1 comment:
these schemes are bad for people who dont know about how they work and are tricked.
but you can actually cut marketing costs and make the product spread.
for example - consider that marketing costs are rs 600 per bicycle. a bicycle worth rs 4000 is sold for rs 500 and seven such ticket to be sold to other people. you generate 4000 for first sale and 3500 for each one who comes up with such ticket (you give seven for 3500 and the bicycle). so you cut prices by 500 and cost by 600, more users can afford it and you make more margins.
not that bad.
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