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Multi-Level Marketing Plan

Pyramid Scheme

Business Focus

Sales of products and services to end-users (NOT other distributors)

Recruiting new members

Profits

Primarily based on the sales of products and services by the distributor Perhaps some percentage of income from sales by downline recruits

Primarily membership fees paid by new recruits or !bonuses" for meeting recruitment goals

Products or Services for Sale

#ousehold goods or services that consumers typically use in everyday life $oods and services are priced competitively with traditional retail outlets

Often a thinly-veiled and poorlymade !miracle" product or service that few consumers want or need %erchandise is typically priced well above comparable products sold in retail stores

&ow or none at all

Start-up Costs

Substantial' often involving recurring !membership" fees or e(pensive !educational'" !training'" or !advertising" materials that can easily be found free of charge elsewhere

Support System

&ow-pressure' eager to answer )uestions about the business and provide detailed information in writing upon re)uest' such as a business and mar*eting plan

#igh pressure' with a constant focus on recruiting new members of the scheme #ard to reach when )uestions arise

Employee/ customer eferences

+ager to provide references who provide honest evaluations of the viability of the %&% plan and the wor* necessary to succeed

,nwilling or unable to provide references or only provides references who themselves attempt to recruit a caller

Sales Pitch

Provides detailed information about the wor* involved Offers no promise of easy riches -oes not use high-pressure sales tactics

.nvolves promises of large profits with minimal wor*' often in highpressure seminar environments ,ses phrases li*e !limited time offer'" !can/t miss opportunity'" and !guaranteed income "

!nfo "vaila#le$

#as a good report with the 0etter 0suiness 0ureau (000) and consumer protection agencies and is registered with the local 1hamber of 1ommerce Provides detailed information on their 2eb site 3N- provides hard copies of annual or )uarterly reports' business plans' and mar*eting materials on demand' for little or no charge

Not registered with the 000 or local 1hamber of 1ommerce .nformation about the company is scarce or limited to a 2eb site

Merchandise Buy-Back

0uys bac* unsold merchandise at 456 or more of purchase price

Refuses to buy bac* merchandise at all or buys bac* at significantly less than the wholesale price

%etting out of the Business

+asily accomplished and accompanied by a reasonable merchandise buy-bac* program

-ifficult' with high-pressure tactics used to *eep participants in the scheme' possibly accompanied by pitches to spend more money on !training" to improve performance

&o' Long the Business (ill Last

Sustainable' based on repeat sales of products and service

-oomed to collapse

&o' Likely )ou*ll Profit

Profits are based on time and effort devoted to selling goods or services to consumers

The vast ma7ority of participants lose money

+he Bottom Line

!t*s a legal #usiness opportunity that may or may not #e a good fit for you,

!t*s illegal, -on*t 'aste your money,