Dean Sampano
Mass Consultants Canada

http://www.livemotivation.com

As usual, the tips and info you provided us all in this video is a “home run”!

Doug Hulse
Triple Diamond Team Leader
TriUnity International
845-856-4805

Regarding your math breakdown of mlm compensation: Your major error here is so fundamental that I find it hard to describe but here goes… I know that it is not good to answer a question with a question but let me ask you this “what company in America would function properly if you flipped their pyramid?” With all your research I probably don’t have to explain that every company has the pyramid structure where people at the bottom make much less than at the top, why is this? Does this make every company illegal? Because it is structurally impossible to for everybody to be a CEO does this mean that corporate America is structurally broken?

The difference in mlm is that everybody starts with a clean slate and has the opportunity to develop their “distribution pyramid” as large as they like. They can do this based on a compensation plan that is 100% results driven, not based on office politics or the typical ass kissing that corporate America requires. You are right in saying that theoretically every company would quickly achieve market saturation if everybody maximized the compensation plan, so to would every company become the monopoly of their industry if they maximized their business plan. Microsoft and Wallmart have gotten close but no company will ever achieve this because of competition, sales force attrition, consumer preferences and a thousand other market variables that no company can avoid. The test of legality, viability or legitimacy has nothing to do with “theoretical market saturation based on perfect execution of a business plan” because as I’ve just indicated every company fails that test. Cream will always rise to the top, 20% will always product 80% of the results. The real test is whether or not there is a product of real value driving the opportunity, this product has to be one that consumers are purchasing regardless of the opportunity involved. You are right in one area of extreme importance. It is critically important that the majority of sales and commissions derive from sales to end consumers that are not attached to the business opportunity. If this is not the case then I will join you in saying that I think the company is not viable.

Of the companies you have joined I would say that PPL is a good company with a viable product of value and their sales volume does derive mostly from consumers. Amway and GDI do not fit that bill, this does not mean they are illegal because that is not the case based on the way the law currently reads. I simply don’t think these businesses are viable long term because the majority of their volume is distributor consumption.

Historically you are very much wrong on all accounts. Amway is one of the oldest mlm companies but they did not morph into Quixstar because of being busted, they morphed into Quixstar because of the bad reputation that the name “Amway” had acquired. They also wanted to upgrade their image as more of 21st century company on the internet instead of a direct sales company in which you had to pick up your products every week from your upline leader. The FTC lost in their suit against Amway and that was way back in ‘79, long before Quixstar came along. Amway did change a lot in the Quixstar move but it had nothing to do with getting busted. This can be easily verified by googling “Amway versus FTC”

I’m sorry but I don’t have time to document everything, most of the fundamental facts regarding legality and everything you are interested in are detailed in the Amway/FTC ruling so feel free to go through that. The bottom line is that network marketing is legal, but there are many legal mlm companies that are not viable long term.

As for specific company endorsements I’d have to mention Ambit Energy because it is the company I represent, but there are many others. Enagic is another company I would work if I were not already engaged.

Since you are one of the successful MLM marketers, could you tell me how many people you have under you? the reason I say the math is bad is because for someone like you to be making a profit that is worth your hourly input, you have to be ‘duping’ roughly five other people into thinking they can make as much money as you… which is impossible, because mathematically, even if you only need three people under you to get three people each to be making a decent profit, then the tripling effect will saturate the market quite quickly. All the bottom level people are misled into thinking that they can produce a residual income, when in reality there is no more market share to be had… that’s the dirty little secret of MLMs. Other businesses know that their growth rate will trickle out and adjust accordingly. MLMs pretend their immune from market forces. They do this using SUPER HYPE.

By the way, I’m not just talking out my ass. I’ve done quite a lot of research on MLMs, and most of the positive stuff is only from people IN MLMs, so I don’t think it’s reliable. Everything else is pretty negative.

I know there MIGHT be some good MLMs out there, but my test of a good MLM is this: do they sell more of their products to clients or to ‘distributors’. I think this is a simple test, and if more money is being made by selling to distributors, then the business model is faulty, dishonest, and will eventually collapse.

How about this Jedi Master: give me a list of THREE good MLMs that you think are honest and fair, and I’ll check them out. If I like their business models, I’ll join under you.

So far, I’ve been involved in Quixtar, Global Domains, and PPL (which is a 50/50 one). I thougth Quixtar had the most potential, but in the end it’s still dishonest.

I was a Math minor, but you don’t have to know Calculus to realize the mathematical errors of MLMs.

Historically, MLMs evolved from Pyramid schemes. Amway was one of the first MLMs, got busted for being illegal, and then morphed into Quixtar and made sure they kept the basic business model but framed it within the laws.

If I am wrong on the math and the history, feel free to post some links for me to read. Preferably newspaper articles and research papers. I have access to Ebscho Host, so it can be from online journals and stuff. I can find them… Peer reviewed would be the best.

There are good and there are bad network marketing companies, no different than any other industry. In this tough economy we are going to see a consolidation all across the board which is good, I don’t like bad companies any more than the next guy. The reality is that mlm is such a powerful marketing concept that many companies use it to promote sub par products that would never sell any other way which is quite unfortunate. But when does right network marketing can market exceptional products more efficiently and while at the same time rewarding those doing the ground work promotion.

On another account it is also true that many companies do prey on people with compensation plans that are destined to leave the average distributor disillusioned and frustrated. This is also unfortunate. The problem is that most people join on an emotional high and don’t quite realize what they got themselves into until they get to a point of no return and quite with a massive bad taste in their mouth.

Do your research. Join a reputable company with a solid compensation plan, honest leaders and a product that you believe in and you can do very well in network marketing.

I make a very good living in this industry and do so at the service of both my distribution force as well as our customers

MLM Jedi

My advice: please get out. You might be too entrenched, maybe just starting to make a profit, to get out. Try this though: calculate how much money you’ve made, minus your expenses (like gas driving to seminars) and divide by the time you’ve put into this business. I can almost gaurantee you’re making less than minimum wage.

I can commit to something that is worth committing to. I’ve lived in the poorest country in Europe supporting myself, and I’m not afraid to take risks. I’ve started my own business, and I’ve tried out different MLMs. The bottom line: you can only make money in an MLM if you’re one of the first people in… those people can only make money if they convince the people under them that they can become FILTHY RICH! I did the math, and it’s unstainable. Sorry…

Just my two cents. Really trying to help, but sincerely sorry if I was offensive.

A random caring citizen,
Youngil Ely Loew