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. MLM expert Robert FitzPatrick explains in his paper The Myth of “Income Opportunity” in Multi-Level Marketing: Put on the …

How MLMs Stay in Business

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…. …

The Non-Retail “Direct Selling” Company

Written by Robert FitzPatrick As market-based economies become the prevailing global model, millions of people are being exposed to sales promotions, income opportunity solicitations, and investment schemes with which they have no experience or knowledge. Vulnerability to deception and the need for consumer education correspondingly reach global heights. One especially …

Just Say No to MLM

Written by Black Nova Just keep saying “no.” I have learned when my friends invite me to MLM engagements of any sort to tell them that I have a personal rule of not supporting any form of MLM because I don’t believe in the business model. Regardless of the quality …

The FTC’s Warnings on Pyramid Schemes

Is Mary Kay a multi-level marketing company (MLM) or is it a pyramid scheme? Does it really matter? Not really… both are essentially business opportunity scams that take money from millions and millions of households a year. MLMs generally have an air of legitimacy about them, usually because they have …

MLM Versus Pyramid Schemes

This article comes from a site called StopSpam.org. The site’s primary purpose seems to be stopping email scams. However, they included this article which addresses the multi-level marketing (MLM) and pyramid scheme issue. I think that Mary Kay falls under the “fraudulent multi-level marketing plan” category. Read the 13 points …