Economics Explained The Bitter Economics of MLM
Jun 7, 2023
Exploring the economics and flaws of multi-level marketing companies, highlighting the risks and unlikelihood of success. Examining the income sources of a top earner in Amway and the questionable financial impacts.
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Unexpected MLM Coffee Pitch
- The host received a pink flyer inviting them to an “exciting business opportunity” and met “Coco” for coffee.
- The meeting turned into a two-hour multi-level marketing presentation about Amherbovon.
Referral Programs Turned Into Business Models
- MLMs amplify normal referral programs into multi-tier commission structures that form the core business model.
- The referral incentives extend multiple levels, turning marketing into the business’s foundation.
The Real Job Is Recruiting, Not Retailing
- Joining an MLM usually makes you a commission-only salesperson or narrow-product retailer, not a general entrepreneur.
- The real pitch is recruiting others to buy in, creating a team-based income dependency.