MLM Distributor

News, Tools, and Resources for the MLM Distributor.
Read More >>

MLM Corporate

News, Tools, and Resources for the MLM Company.
Read More >>

Spotlight

From the FTC... Multi-level marketing (MLM)

MLM - also known as "network" or "matrix" marketing - is a way of selling goods and services through distributors. These plans typically promise that people who sign up as distributors will get commissions two ways - on their own sales and on the sales their recruits have made. 

Pyramid schemes - a form of multi-level marketing - involve paying commissions to distributors only for recruiting new distributors. Pyramid schemes are illegal in most states because the plans inevitably collapse when no new distributors can be recruited. When a plan collapses, most people - except those at the top of the pyramid - lose their money.

MLMs should pay commissions for the retail sales of goods or services, not for recruiting new distributors. MLMs that involve the sale of business opportunities or franchises, as defined by the Franchise Rule, must comply with the Rule's requirements about disclosing the number and percentage of existing franchisees who have achieved the claimed results, as well as cautionary language.
See Franchising and Business Opportunity Ventures.
Source: http://www.ftc.gov/bcp/edu/pubs/business/ecommerce/bus28.shtm

The FTC also provides a dumbed down PDF on Marketing for MLM...
http://www.ftc.gov/bcp/edu/pubs/business/ecommerce/bus28.pdf

Personally, I like Canada's presentation on a legit MLM.  Let me see if I can dig it up.

Disclaimer

The intent of this site is to provide information and resources to be evaluated upon before engaging in, or during engagement within the MLM Industry.  No article or information provided herein is represented as exhaustive in it's knowledge or scope.  Information falls under two primary categories: 1.) news and information derived from publically available sources. 2.) opinions and information which are privately held.

Industry Announcements

Monavie injunction, preventing recruitment in Germany.

Why?  Important parts of the Monavie Compensation Model are in non-compliance with German law on "Progressive Kundenwerbung" (§ 16 Abs. 2 UWG) which is translated as Pyramid selling.

Below the google translation for "Progressive Kundenwerbung" :
Progressive criminal solicitation

Progressive canvassing is in § 16 para 2 UWG made punishable.. This is so called pyramid schemes. Who led consumers to buy in the trade of goods, services or rights by promising that they would obtain either the organizer or by a third party benefits if they encourage others to complete similar transactions, in turn, the type of advertising such advantages for an to obtain further appropriate advertising customers will be penalized.

It is for this offense to the development of such a distribution system.  There is evidence that such systems operate at best short-term and relatively quick collapse.  Because of their exponential growth Schneballsysteme are particularly dangerous.There are a wide range of affected quickly integrated into the system, which are then damaged in the Zusammnbruch.  That is the reason of the special criminal sanction in § 16 para 2 UWG.

Such distribution methods are of special distinction having these days (maximum) distribution activities that take place primarily on the Internet.  Meant the so-called "Power Shopping". The lifeblood of that effort is beginning to several people at an Internet product offered. Even reverse auctions, where automatically the price of a commodity depending on the surcharge-free period decreases below do not belong to this criminal offense. In the case of the so-called multi-level marketing is § 16 para 2 UWG does not meet mandatory. The customer is not alone here involved as customers in the distribution system, but also as agent used, for which they usually receive material benefits.