I have recently had someone try to recruit me to work for Primerica. If you are not familiar with them, they sell life insurance, mortgages, and retirement investments to mostly middle class people. They are a sub-division of Citigroup. The only sub-division that is making money and not taking from the government bailout funds. Their claim is that they help people out by finding better investment options than the ones they already have. I mean, if you take someone who is already investing, but allow them to get more for the same amount of money they already spend, that is helping right? What if you get them better for less money, and educate them on saving and /or investing some of the extra? That is really helping. Now Primerica only sells one option. That would be a strike against them. One can’t provide better every time with only one option.
Here is the kicker. They are structured as a multi level marketing company. On one hand, you can make a lot of money in a MLM if you are willing to work harder than the average person and put in the time it takes to reach the right levels. This money can be acquired faster than the normal route to millions take. Even if you only make $100-$200k a year you still get it quicker than with less overall effort than normal. Besides, that is good money even if you have to put in a lot of overtime for it. The down side is the first year or two is a grind with low pay for the effort. For starters you are commission only as far as pay goes. This is not easy when you have bills to pay and mouths to feed. For this reason, one usually finds young people doing MLM mostly. The business model is dependent on new recruits. Constant new recruits. I would venture to say that 90% of the work is done by new people who don’t last very long at all. These new recruits can cost somewhere between $1000-$1500 to recruit and train. Then they quit mostly before their training is done. Also, if the business model had its way, their would be no one left to recruit or sell to in a few years. Reality is not that way. There are way too many people in the world, and way too few that want to work this model. As a result, an MLM business continues to hire week in and week out. So much that the job description becomes more about selling the job and training than it is about selling the product.
I didn’t take the job. I have worked for Kirby the last two years (I don’t work for them now). I know what it takes, and don’t want to do it. I also know what it pays, and have seen the proof. If you stick it out, you will bank for your efforts. In many ways this type of business is similar to a cult. That is right, a cult. From the way they recruit right down to the sales rallies and company payed vacations. They are elusive and mysterious when they hire. The very nature of the job isolates you from friends and family. Those sales rallies and payed vacations keep you in their “bubble”. Plus all of the work is to benefit the people on top. If you prove yourself and stick it out, you can be on top, but most people don’t make it.
Does this make it immoral? I don’t think so. They do put off telling you what is going on until you are giving it a try. Most people find this offensive. It is, however, very common in our world. Not just by cults/religion, MLM, and gangs. Most of the people who have profited from these businesses got recruited the same way. They would have never done it if they were told up front what really was going on. These same people are grateful that they were “duped” into it. if you have what it takes, and get very rich from it, would you really complain after the fact? As long as 70% or more of the products are sold to non-representitives of the company, then it is not a pyramid scheme. So it is a legitimate business, and if you are willing to do what it takes, you can have what they promised.
The next big problem is it is a sales job. Most people don’t feel they are good at sales. These companies do have a system though. If you follow their system, you don’t have to be good at sales. The law of averages kick in and you can’t help but sell. You will still get way more NO’s than YES’, but it will average out to enough sales to get payed. When you get to the right level, it will pay well. That does not mean that some people will not be able to do it. There are a lot of people who can’t do most things. Such is life. The average person, however, can do it.
I would love to hear your feed back and experiences when it comes to multi level marketing. If your intent is to just bash MLM and the people who do it simply because you don’t like the business model, then don’t bother. However if you would like to discuss the business model as a whole, or perhaps ways to improve it, by all means do so. The same goes for Pro MLM people. don’t jump down the throats of people who don’t like them. I’m looking for and educated debate, not a yelling match.