On Friday 08 February 2008, José Mariz wrote:
> Greetings to all,
>
> I'm a portuguese management student of 25 years old that just got
> involved with agel a few months ago, altough i have recruited some
> people and i'm happy with the products, i've been conducting deep
> ivestigation about MLM and how it works.
>
> The main conclusions i've been driven to are:
> 1 - In this kind of business the products must be usefull to your
> own usage, and not heavily overpriced.
>
> 2 - MLM is a way of distributing goods which works on different
> premisses unlike Microsoft or other business giant, and that can be
> extremelly harmful for anyone if we think we are going to earn money
> without working,it's like going to the restaurant to eat, we can
> either eat and spend the money with it and be "losers" or we can not
> go there and eat at home. The products are the basis of the
> business, and if it is an innovative product then MLM can be a good
> way of putting it into the market. They reduce costs of
> distribuition by implementing a referal system where you will only
> have sucess if you can find people that need the products.
It can also be extremely harmful to anyone that expects to work hard.
I've seen people in MLMs that think all it takes is hard work, so they
put in years of hard work and spent tens of thousands of dollars and
lost quite a bit because the structure was geared to funnel their money
upwards, not to help them succeed.
As for the "losers" comment, that is way off base and, to be frank,
totally out of line. That you are using such a term shows me that you
have already had a good does of the Kool Aid. In other words, you're
already starting to believe everything your MLM people are telling you.
I eat at restaurants. I enjoy meeting a friend and having something
like the Pollo Al Chipotle at the place at the end of the street and
being able to sit and chat and not have to worry about who cooks or
does the dishes.
Does that make me a loser? I have my own business. I pay my own bills
and then some. I drive the exact car I deeply wanted to own and today
I just saw my accountant and there's a good chance that this year I'll
be paying more in taxes than I made in one year as a teacher. I could
be paying 2-3 times what my ex girlfriend made in one year when we were
dating and she was in an MLM.
I'm sorry, but on that point you are wrong. Totally wrong.
Now on to another point you make in that paragraph: If it's an
innovative product, it's a good means of distribution. Oh, that and
reduced cost. Both are wrong. Are you strong enough to learn why or
if I dare to tell you, will you just call me a loser so you don't have
to listen to me telling you something?
First, many people mistrust MLMs and won't buy from them. That's my
experience in talking with people and it's what I saw when my
ex-girlfriend tried to recruit people. Second, if it's innovative,
there are many ways to bring it to market. Personally, if I came up
with something like that, I'd patent it and basically sell rights so
I'd make money without having to run a factory.
If a product is innovative, there's a good chance there's a lack of
trust in it until it's proven. In America we have infomercials. These
are shows that usually are on TV late at night and can run half an hour
or longer. They're nothing but long ads for products. Many people
avoid what these infomercials sell because they don't trust the product
to do what the advertisers claim.
I work in computers. I've seen innovated products and dumb products. I
have never seen, in computers or any other field, a single innovative
product that was marketed through an MLM that became well known or a
household name.
Now let's look at the cost factor. You should know some of this
already. Let's look at a product I might buy at the supermarket. For
convenience we'll take something easy: An ear of corn. I just love
corn on the cob! The farmer grows it and gets paid for it. Then a
transport company carries it to a warehouse and gets paid for moving it
and storing it. Then it's brought to the distribution center in my
city. Again, someone gets paid. Then it's taken to my local grocer
where I buy it and the grocer gets paid. If you count, that's the
farmer, two transport or warehouse companies, and the store that are
probably getting paid.
You will say MLMs eliminate the middle man, but let's look closer. The
farmer creates the product and gets paid for it. The trucker adds
value by bringing it closer to me. The warehouse people add a value by
storing it until it can be taken to the local grocer. He ads even more
value to it by putting it in some place I can get to in a 5 minute
drive and I can inspect the corn and take it home easily. Each of
these people ads some kind of value to the product. They are paid for
their work or contribution and each one is an important link in the
chain.
Now let's look at a product made and sold through an MLM. Someone makes
it, then it's stored. I buy it, so it's shipped to me. Sounds good so
far, but let me take one example: My ex-girlfriend. If she sold me a
product, she got a commission. Her friend's sister, who was her
upline, got a commission. Her friend's sister's Father-in-Law gets a
commission because he's upline and so does his mentor, and so do at
least 2 other people I know between them and the top. That's 6 people
that get paid a commission on that product. Not one of them has done a
single thing to ad value to what I just bought, but they make money on
it.
That's good for them, but bad for me. Why am I paying for them to make
money when they haven't done a thing to make the product more valuable
to me?
MLM doesn't cut costs.
> 3 - The biggest "lie" i've found in MLM is that you cannot actually
> perform AT ALL if you want to get money without spending a long time
> having training, if the company provides it to you, you can actually
> save a lot of time and achieve relative success.
That doesn't apply. Many MLMs insist on ongoing training for everyone
in them. In many cases the MLM people make more money from the
training materials than from product that anyone sells.
> 4 - It is as any other business in terms of risk, you actually make
> an investment in something and you must establish the boundaries for
> yourself, if you are a costumer you are a costumer, if you want a
> small part time biz you will spend a lot of time in building that
> business and them you can rest, and if you want to earn big money
> you have to advertise your product and business model as if it would
> be the best, like the guy in the coffee shop next door, i bet he is
> the best :)
No, it's not the same risk. I created my own business. It's a limited
corporation in that if something goes wrong, it's the business, not me,
that's responsible. My assets are not at risk, but in most MLMs, they
insist on members spending more and more money on training and on
products. That means the members keep spending more and more money.
While it's possible to say that's not required, the truth is that it is
what happens in over 90% of the cases.
You are right, though, that you have to establish boundaries and set
timings so you can see if you should continue or not.
As for resting, there has never been proof that you can rest and we have
one member that managed an MLM business and was doing quite well and
she'll be glad to tell you that once it's built, you can't rest. You
have to help others recruit and build the business. I'm sure you don't
want to believe me and would rather just call me a loser so you can
ignore me, so I'll just say I'm sorry you believe this and if you had
an advanced degree and 10 years of management experience instead of
being inexperienced and a student without a real world background,
you'd see just how unrealistic this is.
Most MLMs will not allow you to advertise your product at all.
As for saying you're the best, that's not always the case. I have a
portable DVD player sitting 1 foot from my arm as I type this. I
didn't buy it because it's the best. I bought it because it was the
one that most suited my needs. You've completely overlooked niche
marketing.
> 5 - MLM is not for everyone, and you should not try to fool people
> so they just enroll in your organization and became a "sucker", if
> you are honest to the people around you, you will for sure not
> generate ressentment.
That is about the only point I've seen so far that is a good point.
> 6 - I've met a lot of "bad" people doing MLM, that are looking for
> a "sucker" to join their organization and have no morale at all.
Most people in MLMs are good but have been taught to be "bad" and to
push people to join.
> Thank you for reading all this. I would appreciate very much your
> comments and opinions on my perspective.
You've gotten mine, but since I disagree and have experience to support
what I say, I will not be surprised if you call me a loser so you can
have an excuse for not listening to someone who speaks up and
says, "You're wrong."
> After reading a lot about MLM i think i still can be a little naive
> so please explain your viewpoints so i can understand.
Honestly, I do think you're naive in this field. MLMs look good. Heck,
they look VERY good, but they are a structure which lends itself to
quick and severe corruption. It's like communism. It sounds good in
theory, but it doesn't work.
Now a question for you: Why are you posting these in this group? Do you
understand the purpose of this group and realize that we are here
because we've been hurt by MLMs? I lost a girlfriend I was quite
interested in. Some people here have lost their families due to MLM
problems. Why would you come into a group like that and try to say
MLMs can be good?
Hal
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