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  1. #1
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    Controlled Growth in MLM - Is is Possible?

    In other businesses, adding means growth and growth means adding. Take McDonalds for example. McDonalds add stores all the time. That has been their main growth strategy for decades. We don't call them a 'scam' for adding a store do we?

    In MLM, adding means growth (and growth means adding) too. In MLM, it's people they are adding. MLM growth strategy is based largely on adding new distributors. Yet we call that growth strategy a "scam".

    What's the difference? Controlled growth is the main difference I believe. McDonalds (and other businesses that add locations) do a heavy (and I mean HEAVY) amount of research before adding a location. McDonalds doesn't just look at an empty lot and say "Let's put a McDees there". And while even McDonalds adds a location that turns out to be non performing every once in awhile, for the most part, their stores by and large become successful. McDonalds and other business usually have a rigidly controlled growth strategy.

    Not quite the same in MLM. MLM distributors are largely rewarded for growth by numbers of new distributors signing up under then. They are not really penalized for failure of their added distributors so many MLMs just operate on "any warm body will do". The application process for most MLMs let's anyone join as long as they pay the fee and agree to the terms. So the upline gets a one time reward (the sign up bonus) and the company gets a few $$ from the new sign up. If the new sign up never does anything, that's all they get. Not really a controlled growth strategy is it?

    So is it safe to say that real growth in an MLM can only come from the addition of quality distributors? Is that even possible in MLM? I can't think of an example of any MLM that qualifies their new signups very much - other than the usual mumbo jumbo. The MLM qualification process might be something like:

    Do you want to earn extra $$$?

    Do you want to work for yourself?

    Do you want fire your boss?

    Do you want financial freedom?

    .. etc.


    So the question is: can an MLM exercise some control over their growth and still be successful? What are some MLM's that do some level of real qualification (if they even exist).

  2. #2
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    Re: Controlled Growth in MLM - Is is Possible?

    Quote Originally Posted by yodaattone View Post
    So the question is: can an MLM exercise some control over their growth and still be successful? What are some MLM's that do some level of real qualification (if they even exist).
    There was a time when market analysts would not recommend
    MdD stock due to the fact almost all growth was due to building new stores. In many areas, they were losing market share.

    Many sales-type opportunities require licenses, background checks, continuing education, etc.

    Unfortunately, in many MLM programs, the only requirement is being able to fog a mirror.
    Everyone is entitled to be stupid, but some abuse the privilege.

    Quote Originally Posted by Joecool44 View Post
    What am I hiding? My true identity and I've been quite successful at it.
    Quote Originally Posted by Joecool44 View Post
    I'm not hiding my identity.

  3. #3
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    Re: Controlled Growth in MLM - Is is Possible?

    Quote Originally Posted by jebaroo View Post

    Unfortunately, in many MLM programs, the only requirement is being able to fog a mirror.
    LOL... and --> :cwm2:

    Unfort that is all too true.

    Side note: I forgot to mention growth by adding customers in MLM. In theory that is possible but does it happen in reality? And the blurred line between Customer and Distributor doesn't usually exist in regular businesses like McDees.

  4. #4
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    Re: Controlled Growth in MLM - Is is Possible?

    MLM as such wouldn't be a bad business model if it wasn't for the overpriced product, high fees and mandatory orders to keep your position on the network.

    While McDonalds don't accept just about anyone as a 'partner' it is hard to fail the tests. McDonalds also provide much more services with marketing which MLM's don't. There is value in the McDonalds fee but not in the MLM fee.
    "This thread is as much of a failure as you are at MLM."

    MLM explained

  5. #5
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    Re: Controlled Growth in MLM - Is is Possible?

    yoda....i think that is a great way to word a big part of the problem with MLM.

    When I interviewed with my company (and others), they asked me what skill sets I had and evaluated how I fit their needs. they didn't show me pictures of the car's the CEO's drove or where they lived or vacationed. They didn't ask me if I was interested in earning hundreds of thousands a year (though they did ask me my long term career goals).

    MLMers seem to think that the skill sets that lead to being successful salespeople, recruiters, and leaders are all generic skills that can be easily taught. fogging the mirror is the only requirement as jeb says. they don't seem to separate customers and recruits...it's the same pool. recruit everyone you can, nevermind that not only will many of those recruits never do anything, but some of them will poison the well by doing the wrong things, ruining it for those that would try to do it a better way.

    of course, none of this addresses the core problem of joke products and joke pricing that is an absolute plague, but it is a key problem that makes MLM the cult-like fringe industry that it is.
    I'm not selling anything, so I don't need links in my signature to for-profit ventures. You really should question the intentions of those here that have them, as they are generally advertising, not informing.

  6. #6
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    Re: Controlled Growth in MLM - Is is Possible?

    Quote Originally Posted by calvinandhobbes View Post
    yoda....i think that is a great way to word a big part of the problem with MLM.

    When I interviewed with my company (and others), they asked me what skill sets I had and evaluated how I fit their needs. they didn't show me pictures of the car's the CEO's drove or where they lived or vacationed. They didn't ask me if I was interested in earning hundreds of thousands a year (though they did ask me my long term career goals).

    MLMers seem to think that the skill sets that lead to being successful salespeople, recruiters, and leaders are all generic skills that can be easily taught. fogging the mirror is the only requirement as jeb says. they don't seem to separate customers and recruits...it's the same pool. recruit everyone you can, nevermind that not only will many of those recruits never do anything, but some of them will poison the well by doing the wrong things, ruining it for those that would try to do it a better way.

    of course, none of this addresses the core problem of joke products and joke pricing that is an absolute plague, but it is a key problem that makes MLM the cult-like fringe industry that it is.
    true, but as soon as your expenses start piling up with nothing to show for all your effort..."you didn't have what it takes" or "you didn't do it right or work hard enough". This simple brainwashing tactic is the single most effective weapon in the mlm arsenal. It's what not only dares new recruits to jump in, it's what keeps them in longer than common sense would normally allow.

    Humans have a natural inclination to feel special, to realize their value. This is the psychology that is targeted. For someone with minimal options in life, having a guide and encouragement to invest as much effort as possible into a sure fire way to make 6 figures is pretty appealing. Not many investments of time and money are presented with such implied guarantee. The guarantee being that if you put in the effort, you will be financially free. The catch, of course, is that mlms do admit that less than 5 percent actually make decent money but that is almost never brought to the attention of a new comer until they fail. It's not an important number until they fail. This is one example of withholding of information and not presenting all the necessary facts on which to base your decision on that makes mlm unethical and a bad investment
    'everyone needs a gimmick darling' -Freddie Mercury

  7. #7
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    Re: Controlled Growth in MLM - Is is Possible?

    Quote Originally Posted by BuffBluff View Post
    MLM as such wouldn't be a bad business model if it wasn't for the overpriced product, high fees and mandatory orders to keep your position on the network.
    Quote Originally Posted by calvinandhobbes View Post



    of course, none of this addresses the core problem of joke products and joke pricing that is an absolute plague,....
    MLM must maintain high prices in order to support their structure. It's the MLM Achilles Heel! They cannot maintain truly competitive pricing because the money to pay the sign-up bonuses and distributor structure (for the few successful distributors) has to come from somewhere.

    In a standard company, there would be a sales force to sell the product/service. They may also work on a commission structure but their cost would be more easily rolled into to an overall budget since the size of the sales force is generally a fixed number.

    So that leaves the MLM with few options other than maintaining high prices. In this economy, they can no longer rely on the expectation that "the customer won't notice" the higher prices.

    Another advantage MLMs can potentially have is if they have a truly unique product or service. Then they can charge what they want for it. However, that usually doesn't last long. It usually isn't long before someone else pops up with the same or similar product or service. Remember MonaVie? In its early days, it was a unique product but then everyone started jumping on the Acai bus. Now you can buy Acai berry juice products at the grocery store.

    Thanks for everyone who is contributing to this topic. So far we are keeping this an interesting discussion instead of the usual "Pissing Contest". :cwm2:

  8. #8
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    Re: Controlled Growth in MLM - Is is Possible?

    Quote Originally Posted by BuffBluff View Post
    MLM as such wouldn't be a bad business model if it wasn't for the overpriced product, high fees and mandatory orders to keep your position on the network.

    While McDonalds don't accept just about anyone as a 'partner' it is hard to fail the tests. McDonalds also provide much more services with marketing which MLM's don't. There is value in the McDonalds fee but not in the MLM fee.
    Buff when you use the term "fees", what specifically are you referring to?
    “The seeker embarks on a journey to find what he wants and discovers, along the way, what he needs.” ― Wally Lamb

  9. #9
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    Re: Controlled Growth in MLM - Is is Possible?

    Quote Originally Posted by yodaattone View Post
    Thanks for everyone who is contributing to this topic. So far we are keeping this an interesting discussion instead of the usual "Pissing Contest". :cwm2:
    only 7 posts so far... give it time

    good luck

    Quote Originally Posted by GeryD View Post
    Buff when you use the term "fees", what specifically are you referring to?
    could he mean joining fees?
    Everyone is entitled to be stupid, but some abuse the privilege.

    Quote Originally Posted by Joecool44 View Post
    What am I hiding? My true identity and I've been quite successful at it.
    Quote Originally Posted by Joecool44 View Post
    I'm not hiding my identity.

  10. #10
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    Re: Controlled Growth in MLM - Is is Possible?

    Quote Originally Posted by jebaroo View Post
    only 7 posts so far... give it time

    good luck
    If I offer my 2 cents, the pissing contests will follow shortly thereafter.
    As long as it is acceptable for a person to beLIEve that he knows how god wants everyone on Earth to live, we will continue to murder one another on account of our myths. ~ Sam Harris, 'The End Of Faith'
    ~~~~~
    Christianity demands the crucifixion of the intellect.
    ~ Susan Kierkegaard

  11. #11
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    Re: Controlled Growth in MLM - Is is Possible?

    Quote Originally Posted by GeryD View Post
    Buff when you use the term "fees", what specifically are you referring to?
    Not sure what exactly he meant, but I would point to "monthly fees" on that. MLM is like a subscription service in that regard. Who else charges monthly fees? Cable, ISP, Electric company...to name a few. So monthly fees by themselves are not a bad thing as long as they provide some value. Those examples I gave provide some direct value to the customer. What value is provided by MLM monthly fees and who is it provided for? I assume there is a monthly fee in Vitamark?

  12. #12
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    Re: Controlled Growth in MLM - Is is Possible?

    Quote Originally Posted by ohein56 View Post
    If I offer my 2 cents, the pissing contests will follow shortly thereafter.
    Maybe if you tried actually adding some real content (rather than the "hit and run" one liners like this) there wouldn't be a pissing contest? You are in Send out Cards as I recall? So maybe you can tell us about the growth strategy of Send out Cards for example.. Do they do any kind of controlled growth?

  13. #13
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    Re: Controlled Growth in MLM - Is is Possible?

    Quote Originally Posted by yodaattone View Post
    So is it safe to say that real growth in an MLM can only come from the addition of quality distributors? Is that even possible in MLM?
    I would argue that it's not. If the MLM's growth is built around recruitment, then we still have the problem with the pyramid mathematics; for every new distributor that makes money, about 99 will lose money. That might not apply if the company's growth strategy was built around product sales, but if that's the goal, then MLM would be just about the least efficient way to achieve it (think Walmart, Amazon, etc.).

    And you can't attract quality distributors unless you (a) have a screening process that sets the bar high; and (b) offer competitive compensation (competitive relative to other non-MLM sales opportunities that is). MLMs do neither.

    Seems to me that most of these MLM companies look to profit through signup fees and selling sales tools and distributor motivational materials. If the MLM aspect were eliminated, so would that revenue stream.

  14. #14
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    Re: Controlled Growth in MLM - Is is Possible?

    Quote Originally Posted by jebaroo View Post

    could he mean joining fees?
    Most likely, yes. But it is also a term that is commonly misapplied so I would rather know how it is being used, perhaps with an example, before agreeing or disagreeing or offering commentary.
    “The seeker embarks on a journey to find what he wants and discovers, along the way, what he needs.” ― Wally Lamb

  15. #15
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    Re: Controlled Growth in MLM - Is is Possible?

    Quote Originally Posted by GeryD View Post
    Most likely, yes. But it is also a term that is commonly misapplied so I would rather know how it is being used, perhaps with an example, before agreeing or disagreeing or offering commentary.
    it is not the normal business model here to know facts before agreeing, disagreeing or offering commentary
    Everyone is entitled to be stupid, but some abuse the privilege.

    Quote Originally Posted by Joecool44 View Post
    What am I hiding? My true identity and I've been quite successful at it.
    Quote Originally Posted by Joecool44 View Post
    I'm not hiding my identity.

  16. #16
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    Re: Controlled Growth in MLM - Is is Possible?

    Quote Originally Posted by yodaattone View Post
    So is it safe to say that real growth in an MLM can only come from the addition of quality distributors?
    Usually the issue is the sales rep leads with the opportunity, not the product.... one would think that given a quality product to market, one could build a customer base.... then over time if a customer wants to become a distributor, they could do so

    good theory, but does not happen much
    Everyone is entitled to be stupid, but some abuse the privilege.

    Quote Originally Posted by Joecool44 View Post
    What am I hiding? My true identity and I've been quite successful at it.
    Quote Originally Posted by Joecool44 View Post
    I'm not hiding my identity.

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