MLM VS Pyramid
KSA
WHAT IS MULTI-LEVEL MARKETING?
DIFFERENCE BETWEEN MLM & PYRAMID SCHEME
WHAT IS

MULTI-LEVEL
MARKETING?

BUILD
YOUR
NETWORK

REACH
YOUR
TARGETS

Multi-Level Marketing, or MLM, is a business strategy in which salespeople recruit other individuals to sell products or services for them, in order to earn a portion of their sales, in addition to his or her own direct sales.

However, recruitment offers greater profit potential, as the salesperson can have multiple income streams.
MLM distributors are usually encouraged to use personal relationship referrals to find recruits.

For example, Ahmad inherits an entire factory of silverware.

Ahmad decides to sell the silverware directly, but also adopts an MLM Multi-Level-Marketing or Network Marketing or direct selling business model.

Ahmad hires his four younger brothers to sell his silverware, in exchange, Ahmad receives a portion of his brothers direct sales. However he tells his brothers that they can also recruit their friends to help sell the silverware.

As an incentive, Ahmad's brothers can collect a portion of the sales from their recruits; a percentage of which, will then be added to the portion that is paid to Ahmad.
A famous MLM Multi-Level-Marketing company example would be like : Amway or QNet KSA

KNOW THE
DIFFERENCE

Multi-Level Marketing is a legal business practice but it is similar to illegal pyramid schemes in its recruitment strategies and business structure. However, there are some key differences between a legal MLM model and a pyramid scheme.

MLM VS
PYRAMID
SCHEME

MLM emphasizes sales of goods and services to the consumer.
MLM goods are similar in price to traditional retail outlets.
MLMs have little or no start-up costs.
Pyramid schemes focus on recruitment first.
Pyramid products are likely to cost significantly more than comparable products in retail outlets.
Pyramid schemes may have expensive membership fees, and charge you for sales training and materials.

MLM can be a good source of income, however,
be careful not to confuse it with a pyramid scheme.

MAKE SURE TO DO YOUR RESEARCH FIRST
BEFORE COMMITTING BOTH TIME AND MONEY.

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