the 1979 FTC ruling on the Amway Trial concluding that Amway was not a
pyramid scheme but in fact delivered products to the end consumers not
paying for recruiting.
It did, however, order Amway to stop retail price fixing and
allocating customers among distributors and prohibited the company
from misrepresenting the amount of profit, earnings or sales its
distributors are likely to achieve with the business. Amway was
ordered to accompany any such statements with the actual averages per
distributor, pointing out that more than half of the distributors do
not make any money, with the average distributor making less than $100
per month. The order was violated with a 1986 ad campaign, resulting
in a $100,000 fine.
Half of the Distributors Do Not Make Any Money!
This is largely due to the structure of the MLM organization. Which is
a horizontal marketing structure.
Like chain stores, Insurance companies, Real estate, Car dealerships,
etc. Let me explain a bit further.
Lets use the example of Macdonald's. When the company sells you a
MacDonald’s. You then begin working really hard to cap the business.
Yes franchises are cap. There is only so much you can make with one
MacDonald’s.
When this happens the Macdonalds Corporation brings in their executive
team and tells you something like this:
"Joe you have done a fantastic job building this Macdonalds! In fact
you have done so well that we want to open another MacDonald’s 2 miles
away. You have 1st choice on purchasing your 2nd franchise."
Now Joe is in a tricky situation because if he does not decide to open
the second one he will lose it to someone else. Meaning that someone
will be able to take half of his business. So then he decides that he
should open a second one. Investing time and money to build the second
one up. But the second Macdonalds does nothing to support the first
one. In fact it takes away business because now customers can go to
the one is that closer to them. Now Joe has double the expense, the
overhead, and the headaches.
Well with MLM this scenario is multiplied a lot more. In order to
succeed in MLM you have to build a network of thousands sometimes 5,
6, 7 levels deep. Yet the person at the top of your network benefits
from all your efforts.
And the person next to you is your competition.
Now imagine a scenario where no matter what level you came in to the
organization you were going to be compensated on your production. And
you could in fact make more money then the person above you!
Sounds Fair to me!
Does it exist?
Yes! Its called Binomial Marketing or Vertical Marketing.
Its based on 2 sales distribution centers not 100’s
Why 2?
Averages show that people have been proven to build 2.8 sales
organizations.
Also 2 are the smallest multiplier to pay a group without running out
of money.
In a vertical system everyone is placed directly below you. You are
not paid on levels. You get 100% credit for the volume your
organization produces through infinity. No one is next to you because
you can only be placed below someone.
Here is an example. Lets use the make-up counter saleswomen. Let call
her Sally.
Sally sells a one custom foundation and a liquid mineral foundation to
a customer. She would make a commission and that same commission would
be paid to her team 100%.
Instead of a normal dog eat dog scenario where she would be competing
with the other counter women.
In the Binomial scenario everyone benefits from each other. This
creates synergy and teamwork. Thus allowing the team or network to
succeed because everyone has an economic bond to each other. It’s
simply a work of genius.
I have seen this tried and proven formula work on many of my
distributors. We all work together. The more successful my team is the
more successful I become!
I posted this thread to shed light on the different options that are
available. If your looking to plug yourself into a Biz Opportunity
likes this ask yourself some important questions.
How long has the company been around for?
What is the executive team like?
Who will be your leader when you first join? (You will have to learn
techniques to be successful so you have to be trained)
Do other people love the products?
To your success and growth,
Rey Valentin
Independent Distributor
Market America Inc.
