
Holy Mamma, today I learned that not everyone knows what an MLM is or how it works! If you haven’t noticed by now I am hardcore anti-mlm, but what made me see the light on this pyramid-shaped “business”?
What is Multi Level Marketing (MLM)
An MLM is any business model with multiple levels of people earning off the people below them, but to be clear, it does not include traditional businesses that pay a salary or wage to their employees. Confused? Here are some examples to give you an idea:
Walmart: Has millions of employees and retail locations. Pays each employee a wage for their time at work and “clocked in”. Everyone gets paid, even simply greeting customers at the door. Walmart is a traditional business.
Amway: Has a central location where they employ humans to run operations. These employees are paid. Has a network of “distributors” who are independent contractors that sell the products to their friends and family, as well as recruit friends and family to become “distributors” themselves.
Distributors earn a commission off of products they sell, products the people they recruit sell, and products that the people recruited by their recruits sell. Those who take part in the “business opportunity” do not get paid for their time. They also are required to invest in marketing materials which can include websites and training seminars. They are required to purchase products for their personal use every month to stay active in the business. This is known as a “quota”.
I am unsure how many levels down the chain Amway pays for sales by recruits of recruits, but as you see “multi-level” is multiple levels down. Amway is a Multi Level Marketing Business, sometimes called Network Marketing.
Why are MLM’s Bad?
Oh let me count the ways…
- Not everyone gets paid. I like getting paid for my time, don’t you?
- You are only paid if you make a sale or your downline makes a sale, or you recruit more people
- Your “business” is being an independent contractor for the MLM, you do not own the business
- You have no control over the marketing materials or the products sold through the MLM
- You must purchase all of your training and marketing materials from the MLM
- You must purchase products to stay active (quota)
- Only the people at the top are making money
- Uplines promote toxic positivity
- Uplines require your presence at expensive trainings and seminars
- Promotions such as “free cars” and “mortgage payments” are dependent on maintaining a high level with the MLM, if you lose that level you are no longer getting the stipend.
- You are not allowed to choose your own car if you qualify for the stipend. You must purchase (get the loan) an expensive vehicle that you aren’t even allowed to choose the color of!
- If you have bad credit and cannot get a loan for an expensive car the MLM chooses, you are fucked. You will not get a stipend at all.
- Uplines promote getting and maxing out credit cards to continue in the MLM
- According to the FTC, the bottom rank (50% of participants) average is $528 per year. My horrific math skills tell me that is $44 a month, $11 a week, and $0.27 per hour for a typical 40-hour work week.
- Uplines encourage “vulnerability” in posting on social media, some women have taken this to an extreme and posted on Instagram in the middle of miscarriages, deaths, and family crises.
- No job security. A company can shut down with no notice and you are stuck with products, no pay for anything you have sold or your downline sold and you have to find a job fast.
This list could continue, however, I have already given you 16 reasons why MLMs suck. If none of these reasons scare you away, take a look at your bank account and imagine losing money every month on products you don’t need, training you don’t want to travel to, and having a panic attack because it is the end of the month and you need to buy more products than usual to hit quota. Imagine alienating all of your friends and family because you won’t shut up about your “business”. Imagine your phone blowing up non-stop because your upline is “encouraging” you to spam more videos on social media.
Is this the life you want to live? I don’t.
If you are still on the fuck you Mandie, you are a hater train, take a gander at one family’s adventure in Amway by reading MerchantsOfDeception. Or if you prefer you can listen to me practice my reading-out-loud skills on my podcast.