MLM vent

[MedicMom]

I'm sort of grouchy today anyway but this set me off.

 

I have a long standing friend who the last few years has done incredibly well with a certain MLM. She has a couple thousand people underneath her, has written a book, and managed to retire both her and her husband and buy a house in cash. Not my cuppa, but good for her.

 

On her Facebook page though, she has hundreds of people saying how they can't even afford her $17 book or a $3 coffee, yet she keeps encouraging them that if only they try harder shilling the quack oils(sorry, I know some people swear by them) they too will be rich. All the have to do is spend X amount of dollars on the oils and hold classes and people will flock to buy from them. They will be rich and have "money in perpetuity" to pass down to their kids.

 

I'm pretty sure I got banned today because I pointed out publicly that just a very small percentage make it as far as my friend and that market oversaturation is real. They'd be better off scraping that $100 together for a bill or new tire or, say, FOOD, while looking for a non MLM job. Like everything else, people will eventually stop buying and find the next new best thing.

 

My sister and cousin jump from MLM to MLM. Both are actually really in need of money, but they spend what little they have on these things.

 

It just irritates the heck out of me.

[Tanaqui]

It's a pyramid scheme. Maybe I'm too judgmental, but I wouldn't be friends with somebody who pushes others to join a pyramid scheme - especially when the product they're selling is a scam in and of itself.

[Seasider]

So you got banned for calling the emperor naked. I wish more people would do that (call out fallacies, not the get banned part).

 

There are people I hear from every other year or so, going through their acquaintances list each time they jump to the next product to hawk.

[Sunshine State Sue]

I'm sorry that the MLM has divided you and your long standing friend.  I will point out that she is not retired if she is still working on growing/maintaining her empire, or pyramid.  And encouraging others (and I'm sure that's not all she's doing) ... IS working.

 

Playing the devil's advocate, are you a little bit jealous?

 

I will never forget the day I met a really fun and interesting mom at a park and thought we were on the road to becoming best friends right until she marketed her MLM to me.  I'm surprised no one else has commented on this thread.  I'd love to hear more bashing MLM stories.  :bigear:

[Tenaj]

I've only had one friendship survive the MLM monster.  In that case, the husband set up a time to come over to formally present the "opportunity".  The wife (my friend) didn't come because of a small baby and I left the house.  My husband is much more diplomatic than I and was able to say no firmly without destroying the friendship and even though they stayed in the "business" for years, our friendship continued to grow and it never became an issue.  

 

I prepared tax returns for years and many of my clients were victims, "investors" in various MLM schemes.  I can honestly say I never saw anyone make any money.  There were a few who enjoyed using the products and I can understand getting involved in order to enjoy discounts but the true MLM'ers rarely make money and from what I saw, generally jump around from MLM to MLM trying to find the magic one that will enable them to become millionaires with little to no effort.  Sorry, that's just not going to happen to very many people.  

[MaeFlowers]

The Federalist just did a piece on the problems with Lularoe. https://thefederalist.com/2017/06/26/lularoe-transform-explosive-growth-collapse/

 

I had a neighbor who got sucked into Mary Kay. Her advisor suggested that she should keep a full inventory and even helped her get a company credit card to do so. On top of that, it was only a month or two before they revamped their entire line. So, she was stuck with a garage full of makeup and skincare because she never sold enough to make even one payment on that credit card. Needless to say, her Dh was ticked when he got back from overseas.

[MommyLiberty5013]

Well, pyramid schemes are illegal. MLMs are not illegal and are legit direct sales companies. MLMs are straightforward with those who are recruited selling quantities of product to buyers outside the company. Whereas, pyramid schemes utilize promises and fancy language to white wash the fact that they are without a legitimate business model.

 

I think being frustrated with a MLM is fine, but it should not be linked in with a pyramid scheme as the terms are not interchangeable.

 

That said, I agree with you on MLMs and I am involved in one and have done it for 12 years now. People have to work their butts off to make it a successful career. My friend drives the pink caddy and buys homes with cash. But, she is doing it 24/7 to anyone and everyone she meets. Good for her. But, that's not me. I just like some of the product and getting it at 50% retail is great.

[Carol in Cal.]

I've seen people make pretty decent money on Amway, Pampered Chef, and CAbI.  I don't know about the others.

One good things about the experience is that some go on to start their own businesses, having learned a lot about that from their uplines, even if they don't stay in the MLM ongoing.

 

But it's really important to lose the rah rah and look objectively at what exactly it takes to make a good return on invested time and money.  It's true theoretically that 'the sky's the limit', but from a practical standpoint people who are looking for prospects by pulling business cards out of restaurant entry jars or who are spending 2 hours selling a couple of mascaras are not going to make much money.  Also, some of the sales pitches are kind of untrue, like pushing 'the oils' for things like cancer (true story, someone I know credited the oils for preventing a return), or calling a product demo a 'facial'.

 

It's also important to understand how often and how completely the product lines switch around.  If you're going to be stuck with a lot of unsaleable stock, that's a significant drag on profits for sure.  LuLaRoe, for instance, is notorious for not letting reps order very specifically, which I can't believe anyone puts up with. 

 

Lately I've been impressed with Lilla Rose hair clips and such.  But again, small sales prices, how much can someone make on that?  Still, a lot of the sales are online so at least there isn't the same kind of time investment that there tends to be with, say, make up.

[amy g.]

I feel like MLMs prey on people who do not have the creativity or the talent to actually produce and market an original product. I feel sorry for the victims who fall for the lure.

 

That said, I went through my FB friends list and unfriended everyone who promoted a MLM through their personal page.

 

A few people noticed and messaged me saying how much they missed me and how they thought we were friends.

 

Well, too bad. Friends don't treat friends like potential money makers.

[MedicMom]

Not jealous at all. What irritates me isn't even the MLM hawking, but the encouragement to these people to spend their last few dimes buying into it.

Especially coming from someone who was living near the poverty level, and should know better.

 

It's not okay to prey on the desperate with your rah rah everyone can do it schemes. Sell whatever you want. The "join my team even if you're broke and you can be rich" makes me mad.

[bettyandbob]

Some people are quite successful in an MLM. This is really due to personality type. People with this type of personality would be successful in real estate or commissioned sales as well. 

 

To make money or even to break even you have to have to be able to project that personality type. I don't know what to call it. definitely extroverted, confident, optimistic. Other stuff. I don't know what it is, but there are similarities between various people I've known who were successful in MLM. 

 

Of course, the way MLM is set up you have to have many sellers below you in order to make money. The deception is when they are selling the business to someone else no one considers if the person trying the business out is really suited to be in that business the first place. So, someone who really doesn't project what is need to attract sales looses a ton of investment in "starter kits". That person has a couple of so-so parties and gives up. I think it would be less deceptive if people did a little analysis on sales ability before encouraging investments in the business. It really is wrong to say "I'm successful and you will have all the success I have." Desperate people want to believe that. 

 

I have a friend who has had a few different MLMs through the years. She has been semi successful (winning prizes and trips and such). She was in a couple different jewelry ones and now Lularoe. The thing that's great about her is she doesn't force it one everyone. She's never asked me to join her network. She probably knows that 1. I am uninterested and 2. I'd be a complete failure. 

 

 

[Farrar]

Well, pyramid schemes are illegal. MLMs are not illegal and are legit direct sales companies. MLMs are straightforward with those who are recruited selling quantities of product to buyers outside the company. Whereas, pyramid schemes utilize promises and fancy language to white wash the fact that they are without a legitimate business model.

 

Actually, the FTC investigates and ends up classifying various MLM's as pyramid schemes routinely - it's sadly not uncommon for 90% or more of the participants not to recoup their costs in getting starting for some of these outfits. Obviously, not all fall under that legal definition, but I've never an MLM that doesn't rely in part on getting new sellers to enroll. And colloquially speaking, I would say that *is* a pyramid scheme, the same way the people use the phrase "price gouging" or "monopoly" to informally describe things that don't meet the legal standards for those crimes either.

[EMS83]

Not jealous at all. What irritates me isn't even the MLM hawking, but the encouragement to these people to spend their last few dimes buying into it.

Especially coming from someone who was living near the poverty level, and should know better.

 

It's not okay to prey on the desperate with your rah rah everyone can do it schemes. Sell whatever you want. The "join my team even if you're broke and you can be rich" makes me mad.

This.

 

My friend recently got into one, and she's excited and I'm happy for her.  I'm not signing up, though.  But I wish her well.  :)  So far she hasn't been pushy or said anything nuts like your friend, though.