MLM, multi-level marketing, network marketing, etc, has gotten a bad wrap over the years. Originally designed to give the advertising budget of a product's price to independent distributors instead of media corporations, many so called "companies" have sprung up over the years trying to imitate this success with a thinly veiled scam.



You see, there is such a thing in this world as a legitimate network marketing company. And there is also such a thing as an illegitimate pyramid scheme.

In a legitimate multi level marketing company, a product is being sold that is of value. It is usually, though not always, of a better quality than one could find in a typical store. This makes it sought after.

The product is typically a little higher in price than its retail counterparts, but is also typically worth the higher price. Distributors sell this product, as well as the distributorship opportunity, to earn income.

With a pyramid scheme, one of two things is wrong. Either there is no product whatsoever, or the product is worthless and completely overpriced. Instead of selling a product, distributors only sell an opportunity, with a product on the side.

To find out if the company you are thinking of getting involved with is a legitimate MLM or a scam, ask the following questions. If you have trouble coming up with the answers, ask someone close to you not already in the opportunity for a non-biased opinion.

Does the product have value?

The product or products that your company sells must have value. Though they are often slightly overpriced, they cannot be priced completely out of the market, and must be of better quality.

For instance, would you pay $20 for a box of paperclips? No. That would not have any value to you. The product that the marketing sells must be worth it.

Can you envision this product selling at a fair or convention?

Picture a booth at a flea market, farmer's market, roadside stand or upscale convention. Will your product fit into some sort of festival?

Whether you are selling food items, candles, or some sort of service, your product needs to have a marketable venue. Those that do not will be very difficult to sell.

Would a distributor be able to make a living on product sales alone?

Is there a good enough commission on your products to be able to make a living strictly selling products? Is there a market for the products?

Or is the company's commission plan based solely on recruiting, with sales as an afterthought. If you can't sell the product, you can't sell the opportunity.

If your product passes all these tests, then the company you are investigating is a sound one, and should warrant further consideration. If it does not, and you are basically selling an empty opportunity, run now, before you waste both your time and your money.

There are dozens if not hundreds of legitimate companies out there that will pass these tests. And for those that do, the opportunity can be a very worthwhile one.