and now in all seriousness. Multi-level marketing,MLM, known by its acronym, is a type of business in which one founder selling a particular type of product attracts another person to sell a product. These people, of course, have the opportunity to put others under themselves, which in turn will sell and expand the company together with other sellers. This creates a constantly growing network with new vendors. Profits flow to individual sellers both from their own sales and from the sales of people they recruited into the company.
They receive a percentage of their sales. The biggest profit from all other sales, of course, has the first, founding distributors, sellers. Those who acquire additional sellers in the business are calledsponsors. At the moment when there is a large enough team of people under them, they often stop selling products on their own and are paid only a percentage (commission) of other people\’s sales. The sponsor has the function of a “mentor” for subordinates and, above all, for newcomers. After all, it is in his interests. The better the seller is in the team, the more commissions he earns.
Not to be confused with the pyramid scheme.
While it may seem at first glance that multi-level marketing is just another name for the infamous pyramid scheme, don\’t be fooled. Pyramidis also based on expanding the team with new members, but the products sold here are somehow completely missing. In the case of “tickets” sold here, you pay the registration fee and think that from now on you will only earn money. However, this fee will partially go into your sponsor\’s pocket, that is, the person who got you for sale, and some will go into his sponsor\’s pocket until the money falls into the hands of the highest ranked person in the entire system. Even in multi-level marketing, you may incur a registration fee, but there you actually have goods for sale.
Who will succeed?
Whether anyone will succeed in this kind of business can be well discussed. Direct sales are not suitable for everyone. You need not only to reach out to family, friends, but also to complete strangers and convince them of the importance of buying your product. The fact that mom buys shampoo from you does not really predispose you to success. In fact, it is very difficult to learn how to sell effectively, and it is long-term. A small percentage of the total number of sellers in MLM networks is enough only income from sales. Most of them have MLM as a form of entertainment in addition to their classic work.