I work as a web dev, FE/BE, and company I currently work in took a project that is basically some kind of MLM structured business. It’s a challenge to do such project, not only from dev perspective, but also morally I’m not sure if I’m okay with it.
My question is - what do you think about MLM structures in companies ? Is it scam based business or is there something that I’m missing ?
It’s not decided yet if it will be binary or turnover based, but what is your experience with those two types of management system ?- from a technical perspective or product seller perspective. Thank you.
Have you ever worked for MLM company before? What was you experience ?
Multi-level marketing is a kind of pyramid scheme, they're only legal because existing anti-pyramid scheme laws only prohibit "businesses" that don't actually sell any products, and make all of their money through recruitment.
MLMs get around this by recruiting people to "sell" products, but recruits must pay for them in advance (almost always at a massive markup) and the products are typically so overpriced and/or poorly made that many of them go unsold.
So, almost all of the profit of those at the top of the pyramid comes from their downstream recruits recruiting more people to "sell" the product, even though product sales are completely unrelated to the success of the scheme as a whole.
If you're having issues with morals I'll help out, don't worry bud.
MLMs are pure scum of the earth. My mother was a part of Mary Kay in the 90s. She was always a bit socially awkward so MK gave her friends immediately, outings she could go to, everyone was so happy to be included. In the beginning she did okay, she sold some makeup and was happy with everyone, but her upline told her she needed to do more.
Now with MLMs you buy the product up front and then it's in you to sell it. Making rank is based on how much product you buy, not really how much you sell. So I remember growing up with her storeroom of makeup. Shelves and shelves of makeup. Because if she wanted to keep her friends and keep going her upline told her she had to do more, start hosting parties, get some downlines yourself.
So she did, she pushed, and she hustled, and had parties all the time and she made it all the way to the Mary Kay director level. She got the Grand Am award for making it so far! It was awesome!
Until it wasn't. You see that huge amount of sales, that pushing? She had to keep doing that just to maintain that level. To keep going she would need to keep doing the insane amount she did for that month forever.
The car by the way? It was a lease, in her name. Just Mary Kay would pay the car payment as long as she kept the status.
Dad worked for the government making a simple salary. She didn't have a real job. Her sales slipped because she had sold to all of her friends already. She tried to expand but her social network was tapped out. On threat of being demoted and the her being responsible for the car payments she kept buying product, what's one month or just buying a bit more so they'll pay for the car? So she can keep the friends?
It was only a matter of time. She dropped status and they stopped paying for the car. She was ostracized for not hustling enough.
Dad left for dozens of reasons but not in small part due to money issues and quote: "I don't have enough money to get lunch with my friends at work". They repod the car, and finally the bank took the house.
It's been 25 years from that and she is financially destitute. She works retail in her 70s because her entire life plan revolved around Mary Kay. They don't offer retirement, savings, or benefits, and she bet everything on her marriage working out perfectly. So no retirement, no savings, no income. The prime earning period she had was spent giving money to this shill of a "company" so she could feel like she belonged and was helping the family. Her money issues are not solely on MaryKay, she never learned how to properly manage money, but MaryKay and other MLMs prey on people who do not have financial literacy promising them that their worry about bills and mortgages and putting food on the table will be a thing of the past, if they just hustle a bit more.
MLMs prey on moms who live at home who are desperate for friends and community. They rely on people who are not financially smart enough to know that you should never pay to be a part of a company. They're sneaky, you make choices you know feel wrong but don't end up biting until it all collapses
My mom's story is not unique, but it's personal. Check out LuLaRich on Netflix for info on LuLaRoe and how leggings have destroyed countless moms, Betting on Zero which is the story of Herbalife, and John Oliver does a great segment on MLMs and how unregulated they are.
