Is Network Marketing Pyramid SchemeOft times as I introduce my business opportunity to new prospects they ask me, “Isn't that another Network Marketing a pyramid scheme?” Back some years ago, I approached my cousin's adult daughter about looking at one of the businesses that I was involved in. She spoke to her father about it before allowing me the opportunity to explain exactly what it was that I was proposing, and her father warned her that I was involved in a network marketing pyramid scheme and not to get involved. I never got the opportunity to explain to her exactly what it was that I was proposing but I should have followed up with her for 2 reasons…

  1. To let her know that it wasn't a network marketing opportunity at all, and
  2. So that I could give her a little advise about shutting doors before you really know what's on the other side of them!

Anyway, over the years, network marketing has gotten a bad reputation because of the Organizational Network Marketing pyramid structure. What is funny about this is that almost everyone who works in a 9-to-5 job exists within a pyramid structured organization.

I remember back when I was a kid there were these chain letters going around where you were supposed to send $5 to everyone “above” you the list and then put your name at the bottom of the list. In this scheme, everyone who participated gave away 5 dollars of their money in exchange for the possibility – a hope – a wish that 100s of people would start sending them crisp $5 dollar bills without them having provided anything of value.

This is the nature of pyramid schemes, within them, there is no exchange of value between the participants, and this is how pyramid schemes and network marketing differ. With network marketing, the people involved in the business are directly compensated for selling products, recruiting and properly training others .

Network Marketing is a Real Business Not A Network Marketing Pyramid Scheme

If you are involved in a reputable network marketing business, there is value exchanged in the form of actual products/services and in some cases even higher value training and coaching.

Network Marketing companies are just like all other reputable companies who have a product or service that they make available to the public, the only difference is that instead of spendingmillions of dollars in TV, radio and newspaper Advertisements while network marketing companies allow their independent business owners or partners to use their personal networks to advertise their products and services, thus allowing those people to make a living by marketing the company's products.

There are even some Network marketing businesses that are publicly traded, and if the United States Security and Exchange Commission thinks that these are legitimate businessesand not network marketing pyramid schemes, then who am I to question them.

As I mentioned previously, almost every corporate entity in America has a pyramid hierarchical structure, the only difference is that in Network marketing, is that everyone who joins a viable network marketing company has the opportunity to become the CEO of their own organization!

 

 

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