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What Is A MLM Company – How Can I Make Money With An MLM Business

Hi, everybody Dale here and today’s topic is about MLM companies. I am writing this post for all the people who have heard the term MLM but don’t understand what it means. In the following paragraphs, I hope to explain it in more detail so you will understand what it means and how you can earn money with this type of business model.

 

 

What Is A MLM Company

MLM stands for Multi-Level Marketing and here are a few other names associated with MLM. Network Marketing, Direct Sales Marketing, Referral Marketing, and Pyramid Selling not to be confused with a Pyramid Scheme.

 

Did you know one of the first companies founded in the United States was back in 1886 and is still going strong today? The name of the company is Avon for those of you who wish to know. Not all MLM companies survive, but neither does a lot of other types of businesses.

 

Multi-Level Marketing (MLM) companies operate by having a product or service they wish to get into the market place but instead of hiring a bunch of employees they pay a salary too or spend millions of dollars on advertising they offer what is either called associates or distributors a home based business and pay people like you and me commissions for product sales and sending them customers.

 

Some MLM companies are free to join and others you have to pay a fee to be a member. With some companies, you have to purchase what is called a getting started package which usually has three different price points and then you have to buy products each month to resale.

 

Other MLM companies will give you a replicated website with their products or services that you send people to so they can purchase the products without you having to buy and resale them yourself.

 

Bottom line is if you are thinking about joining an MLM company I suggest you do some research about the company and find out all the ends and outs before you sign-up. It is estimated there are over a thousand companies in the U.S. alone who use the MLM business model.

 

Here is a list of a few MLM companies you might recognize.

  • Amway
  • Avon
  • Beachbody
  • doTerra
  • Forever Living Products
  • Herbalife
  • Kleeneze
  • Mary Kay
  • Melaleuca
  • Young Living
  • SeneGence
  • Primerica
  • Nu Skin Enterprises
  • Nature’s Sunshine Products
  • Telecom Plus
  • Tupperware

 

 

Is A MLM Company The Same Thing As A Pyramid Scheme

As I mentioned up above pyramid selling (MLM) is not the same thing as a pyramid scheme. With a legitimate MLM company, you earn commissions off of product sells and if no one purchases anything from either you someone on your team or your replicated website then you don’t make any money.

 

So, therefore, it doesn’t matter how many people you recruit if no one is buying your not earning an income.

 

Pyramid schemes are illegal, but some pyramid schemes try to disguise themselves as a legitimate MLM company so beware of what you are signing up for and make sure it is a legitimate business.

 

The U.S. Federal Trade Commission has been cracking down on non-legitimate MLM companies (pyramid schemes) and warns people to stay away from multi-level marketing plans which pay commissions for recruiting new associates or distributors.

 

With a legitimate MLM company, it is okay to recruit new associates or distributors into the business, but the only way you earn money from them is from product sales not signing them up.

 

In other words, if you personally enroll someone into your business and they make a product purchase you earn the commission. If that person enrolls someone into the company who purchases something they get the lions-share of the commission and you get a small percentage as well.

 

 

Things To Look For In A MLM Company

If you are thinking about joining an MLM company, there are some things you need to look into first; such as.

 

  • Who are the owners and what accomplishments do they have to their credit?

 

  • Is there any up-front cost to join the business such as having to purchase a starter package or can you join for free?

 

  • What are the requirements of the compensation plan and what percentage do you earn on product sells?

 

  • Do the products work, made of good quality and something you will have repeat customers for or something that is a one time sale and continuously having to promote to get new people?

 

As with anything else in life you are thinking about doing it always pays to do some research first.

 

 

Can You Make Money Working For An MLM Company

Can you make money working for an MLM company? The honest answer is yes, but it depends on how motivated you are as to how much you can make. You have to do the work of promoting the products to get paid.

 

Just don’t let yourself buy into the B.S. most all MLM companies try to sell you on. If you don’t know what I mean by that I am talking about them telling you to just sign-up three people and then help them to sign-up three and so on and you will make a bunch of money.

 

The truth is it doesn’t matter if you sign-up 2000 people if no one is buying any products then you aren’t making any money. The only way you earn any money is on sales so I would much rather have 2000 customers purchasing than to try to build a large team where 90% of them are probably not even buying a product.

 

So keep that in mind if you are thinking about joining an MLM business!

 

One other thing you need to understand and keep in mind is it will probably take you anywhere from 1 to 3 years or 3 to 5 years to build your business up big enough to make good residual income, and that depends on you your efforts and of course some people who have joined your company.

 

 

Conclusion

In closing, if you are anything like me I am not a very good salesperson so I would not be joining an MLM company where I had to buy products and then try to sell them because I would end up giving them away and lose my money. I like a company I can join for free and gives me a free website to promote the products and send customers too.

 

But if you are a good salesman, you might do just fine with buying the products and reselling them but just don’t let yourself end up like so many others with a garage full of products they didn’t sell and lost a lot of money in the process.

 

I wish you the very best in your journey to financial freedom!

 

Sincerely Dale

Prospering With CBD

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Dale Odom

26 Comments

  1. Thanks for your informative website. I had always thought initially that MLM is always the same as pyramid schemes, but after reading your post, I have been enlightened. I will definitely bookmark this page and read it over and over again because your post has already convinced me to join because I am a good sales man. Hope to read more of subsequent posts. Thanks

    • Hi Dapoach, you are welcome!

      Most people seem to associate MLM companies with pyramid schemes, and that is something I am hoping to change with this website by educating people.

      In truth network marketing (MLM) isn’t that much different than affiliate marketing. With an MLM company most of the time they give you a free website with the products you promote. With affiliate marketing, you have to build your on-site and continuously write new content, but you can promote any products you want too.

      But one of the most significant differences is that with an MLM you don’t own the website as you do with affiliate marketing, so you don’t have any control over the content or any of the decision making.

      Dapoach, if you do decide to join an MLM company make sure you do some research on it first. If you find an MLM company, you choose to participate in you can always do what I did and create your very own niche website about the products they offer and the benefits.

      I wish you the best!

      Sincerely Dale

      Prospering With CBD

  2. I like the way you took the time to dissect MLM programs. It seems we are in the same bunch, poor sales representative. I also wouldn’t be signing up for an MLM program because I’ll also just lose money. Have you also noticed that MLM products are always pricey hence making them harder to sell? Just my two cents.

    • Hi Louis, I appreciate you visiting my site. The reason I took the time to try and dissect MLM programs is that it seems like everyone automatically assumes they are all pyramid schemes.

      I am not a very good door to door kind of salesman that is for sure, but I am involved with an MLM company. But I joined the CBD MLM business because of the products, and I am not necessarily trying to build a team.

      I work with people with all kinds of health issues, and I know the health benefits of taking the CBD Oils because I have done my research.

      Louis you don’t have to lose money at all if you find a company that is free to join with no start-up fees. I actually make money every week from the company I am with because the products work so well; I have repeat customers every month.

      I agree with you though that the products are always pricey but if it is a good quality product and it works people will pay for it.

      I wish you the best!

      Sincerely Dale

      Prospering With CBD

  3. Thanks for the tips about MLM Companies. I think multi-marketing is the next big thing when it comes to money making through marketing online. I have been looking for similar sites, and I am more than lucky to be here, not just for the comment but for the info I am getting. Great writeup, am bookmarking this site for more posts like this. 

    • Hi Ayodeji, you are welcome and thanks for stopping by and leaving a comment.

      Multi-Level Marketing has been around for a very long time. One of the first MLM companies was founded in 1886 and is still in existence today known as Avon.

      I am happy you found some value in my article Ayodeji, and yes please stop by anytime as I am continually adding new posts and information.

      I wish you the best!

      Sincerely Dale

      Prospering With CBD

  4. Amazing write up. I had not really heard so much about Multi Level marketing companies until now. Although, I had been seeing and hearing some stuff about Herbalife and Forever living products and oh yeah! Also Mary Kay. This  post has also thrown so much light to the differences between Multi Level Marketing companies and Pyramid schemes. Hence, a balance has been struck in my mind and I can tell the two apart quite conveniently. Cheers.

    • Hi Oneal, thank you for the compliment I appreciate it. Multi-Level Marketing (MLM) has been around for a very long time. I am glad I was able to shed some light on the subject for you especially if you can tell the differences between an MLM and a pyramid scheme.

      I wish you the best!

      Sincerely Dale

      Prospering With CBD

  5. Thanks for this great insight about multi-level marketing. I have always thought MLM companies are scams because of the referral and matrix issues, but your article has opened my eyes to the beauty of what I haven’t discovered for years. I think MLM is for networkers and salespersons that knows how to convince people easily. Thanks for sharing this lovely article.

    • Hey Ola, you are welcome. Yes, Ola, it seems most people are of the same impression as you, and that is what inspired me to write this post. I am happy if my article helped you to have a better understanding of MLM companies.

      I would agree with you that an MLM company is an excellent choice for networkers and salespeople, but it is also a good way for the ordinary person with an above average desire to start a business for very little money and in some cases for free.

      Ola, one of the mistakes people new to network marketing make is trying to convince people to join their business. In my opinion, it is much better to focus on the products and finding customers because the only way you make money is if someone is purchasing the products.

      I wish you the best!

      Sincerely Dale

      Prospering With CBD

  6. Hi Dale! I greatly respect companies like Avon and Tupperware. They have a legit business model and it’s an MLM. I know that they must be doing things right because they have been around for many years.

    On the other hand, pyramid schemes have produced scandals and made lots of people lose money. And the fact that most pyramid schemes hide themselves as MLM, has brought MLM into disrepute in the sight of many.

    I have been researching a bit about MLM and I landed upon your site. After reading the pros and cons of MLM I conclude that MLM doesn’t have anything to do with these pyramid schemes.

    • Hi Henry, I agree with you about Avon and Tupperware doing something right because I am 54 years old and they have been around since I was a kid.

      It is true, and a shame that pyramid schemes do try and disguise themselves as a legitimate MLM company. But I also don’t find it fair for people to place blame on the MLM business model because of some unscrupulous businesses.

      I know a lot of people have tried MLM businesses before and failed at it including myself a few times. But I didn’t blame the company for my lack of skills or go shouting to the world it was a pyramid scheme or a scam.

      I took responsibility for my actions and learned from my mistakes what I needed too to become successful at working this type of business model. Too many people join an MLM company thinking they are just going to makes lots of money quickly and that is usually not the case.

      They got caught up into the hype! 

      So when people don’t make any money quickly, all of a sudden it is a pyramid scheme or a scam. My question to them would be. Did they really try and work the business by taking consistent steps on a daily weekly and monthly basis? Or did they pretend too? Or did they give up to soon?

      If a person doesn’t believe in the product they are peddling, they are going to have a tough time selling it to someone else. On the other hand, if you have a product, you believe in it’s not that hard to sell it to someone else because you then come from a place of passion and confidence.

      Every business in some way operates in the form of a pyramid including the military.

      My advice to anyone thinking about doing an MLM business is to do your research first. Find a company which offers products you believe in and that way it isn’t as hard to sell it to someone else and don’t get caught up into all of the B.S. about recruiting other people.

      Recruiting people doesn’t make you any money selling products makes you a residual income because of repeat customers if the products are excellent. Some of your customers will turn into team members of the best kind because they are already buying the products.

      I would also never recommend a company where you have to purchase a getting started package and have to buy monthly products to resale unless you are a great salesperson.

      If you find a company, you can join for free which gives you a free website and then if you don’t make any money the only thing you’ve lost is the time and effort you put into promoting the products.

      I wish you the best!

      Sincerely Dale

      Prospering With CBD

  7. I never knew what an MLM company was and I never knew that Tupperware is one of them and that is the one in which I am familiar. It really does make sense to hear that you can not make money by just getting people to join, but the only way to make money is to make sales with MLM. 

    I am looking forward to being part of the MLM company and hoping to make even more sales.

    • Hi Nkhosingiphile, I am happy if you were able to learn something new from my article. Tupperware is another one of those companies that have been around for a long time.

      Yes, Nkhosingiphile the only way you earn any income from an MLM is through product sales not by signing people up. However, you do hope to sign-up a few good business partners to help you grow your business faster, but you also need to work and help them too.

      I explain how to find business partners in another post I wrote about generating leads you might find useful if you do decide to join a network marketing business.

      I wish you the best!

      Sincerely Dale

      Prospering With CBD

  8. Thank you for clearing up the misconceptions between the MLM and pyramid scheme. I have actually burned my fingers in a pyramid scheme and labeled all of them as uncanny. The CTFO MLM model is ideal. If you or your downlines don’t purchase you don’t earn. I think it is good. I will join it. Thank you for sharing. 

    • Hey Paschal, you are very welcome and thanks for the comment. I agree with you that pyramid schemes are very unethical and they are partly responsible for giving MLM companies a bad name.

      I have been a part of CTFO for about six months now, and so far the only complaint I have is they have been trying to give us a more professional website with training videos and other great resources, but they haven’t gotten the back-office finished.

      It really shouldn’t be a complaint though because they are making it easier for us distributors to share. I have no complaints with the products or pay plan at all.

      If you do decide to join Paschal look me up and if you ever need any help just ask, I will be happy to help you out if I can.

      Sincerely Dale

      Prospering With CBD

  9. Excellent and honest review in this article on how to make money with an MLM business

    making money on MLM can be challenging for someone that doesn’t know how to sell or talk too much about a particular topic different place and for different people. That’s more reason many are stuck in between the line

    I like how you related the article to how to spot a fake MLM program. I will later look at your recommendation.

    • Thank you for the kind words Ajibola40 I appreciate it. Yes, you are right in saying that an MLM company can be challenging for some people, but fortunately, I have always liked a good challenge.

      I think most people who join an MLM business thinks they are going to get rich quick so therefore they have an unrealistic mindset about the business model. It will take about one to three years of steady work to create a residual income for some people. Others might take longer.

      Network marketing isn’t for everyone. I would never try to sell something I didn’t use and believe in myself.

      Best wishes!

      Sincerely Dale

      Prospering With CBD

  10. CBD oil is a very good product and has been for a while now. It has been said that it has so much nutritional benefits and medicinal value. I don’t think CBD oil should be used for multi-level marketing because the value may certainly depreciate if used as MLM because people don’t like MLM. 

    • Hi Kenechi, I agree with you on the fact that CBD oil is an excellent product with a lot of nutritional and health benefits.

      I also agree with you that most people don’t like the MLM business model but the reason companies use it is because they don’t have to hire a lot of employees or pay out millions of dollars on advertising.

      MLM companies would rather instead give you a free business and pay people commissions for doing the advertising for them. It’s a smart way for a company to do business if you think about it. They get tons of advertising for their products and only have to pay out commissions on product sales.

      CBD is just getting a foothold here in the United States, and I only see it getting more and more popular over the next several years because of the health and nutritional benefits you mentioned.

      Best wishes!

      Sincerely Dale

      Prospering With CBD

  11. Hi Odom,

    You are thanked very much for sharing this informative article. The business concept of Multi-Level Marketing is very amazing. I heard about MLM businesses before. Then I did not think I could do this type of business. Now after reading your article I got a clear idea. I am very inspired by reading this article. I will be sharing this information with my friends and family.

    • Hey Irin, you are very welcome.

      Irin, doing network marketing (MLM) isn’t all that much different than doing affiliate marketing.

      Most MLM companies give you a website with their products or services already on them whereas with affiliate marketing you have to build out your on site to promote products or services.

      Either way, you are promoting products or services!

      I wrote another post about the differences between network and affiliate marketing with the pros and cons to both you might like to read to get an even better understanding.

      I am happy I could help, and if you have any questions Irin, post them in the comments section, and I will respond to them promptly.

      Best wishes!

      Sincerely Dale

      Prospering With CBD

  12. I tried MLM before, thinking of earning an extra income with my day job, it was one of my worst moves because I ended up giving all I bought and planned to sell for free. I wish I could do the job of a salesman, I would have taken MLM full-time. You write really good. Precise and straight to point. Good job!

    • Hi, Faftop, I would never do an MLM business where I had to purchase products and then resale them because I would end up like you did and end of giving them away because I am not that kind of a salesperson.

      You do not have to purchase products to resale in all MLM companies. The company I am involved with gives you a free website with the products already on it. I send people who are interested in the products to my site where they can make a purchase, and the company handles all of the shipping and sends me the commissions.

      But with any type of business you are thinking about venturing into, it is always a good idea to do your research first. Thanks for the compliments Faftop I appreciate it.

      Best wishes!

      Sincerely Dale

      Prospering With CBD

  13. Great post and good info.

    I tried Herbalife once, it is indeed an MLM company, and I would never do it anymore. 

    It is a pyramid company, but it doesn’t mean that the other ones are. I never tried them, but for me personally, I’m not a fan of it. 

    Would you recommend this to other people? 

    Thanks for sharing it! 

    • Hi Emmanuel, thank you. I appreciate it, and you are welcome.

      A pyramid is just a business model; almost every traditional business operates under including the military when you think about it. You have the owner of a company, then the CEO and Vice president followed by Human Resources, Marketing & Sales Team, Plant Managers, Supervisors, Leaders, and then the workers.

      Would I recommend this to other people?

      Network Marketing is not for everyone, but yes I would recommend it because where else can the average person with above average desire start a business with very little investment and can create financial freedom.

      With all of that being said a person needs to research the company they are thinking about joining first. I personally would never join an MLM company where I had to purchase products and then resale them as some MLM companies do unless you are a great salesperson.

      Best wishes!

      Sincerely Dale

      Prospering With CBD

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