The Myth of “Product Sales” in MLM

A common tactic of multi-level marketing companies is hiding behind “product sales,” convincing potential recruits that significant retailing of products occurs, while in reality money is made from recruiting new marks. Sure, some products are retailed to third party customers (rather than just distributors making purchases). But the amount of …

How MLMs Stay in Business (The Scam!)

Multi-level marketing companies that depend upon an endless chain of recruiting are doomed to collapse… as eventually the world will run out of people. Yet MLMs like Mary Kay continue to exist for decades, don’t they? (And the MLM apologists even using this longstanding history to give the company legitimacy…. …

10 Big Lies of Multi-Level Marketing

Following are some excerpts from Robert FitzPatrick’s article “The 10 Big Lies of Multi-Level Marketing.” Robert has studied MLMs and pyramid schemes for years and is the author of the book  False Profits and the head of  Pyramid Scheme Alert. Robert has also served as an expert witness on pyramid …

Massive Failure Rates in MLM

Robert FitzPatrick of Pyramid Scheme Alert has conducted extensive research on multi-level marketing companies (MLMs). The research can be difficult with companies like Mary Kay, which are privately owned and therefore don’t release hardly any information about the dismal earnings of the sales force. On the other hand, certain companies …

Common Deceptions Used to Lure People Into MLMs

Multi-level marketing expert Robert FitzPatrick summarizes the common deceptions used to recruit new marks into MLMs and pyramid schemes. From his paper The Myth of “Income Opportunity” in Multi-Level Marketing: The Lure and the Hook MLM companies divert attention from the flawed business model and the disastrous financial outcome suffered …

Why MLM Doesn’t Work

Written by Rachel I recently read a quote from a site promoting an MLM: To recoup your initial $570 costs, focus on enrolling two distributors into your downline and then help them also enroll two people each. This is the problem. Right here. It’s the exponential growth caused by unlimited …