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RE: LeoThread 2024-12-22 00:43

in LeoFinance • last month

Why Multi-Level Marketing Companies Are Worse Than Pyramid Schemes

Multi-level marketing companies, such as Herbalife and Amway, are often mistakenly referred to as pyramid schemes, but they are actually worse due to their legal structure, financial exploitation, and damage to relationships.

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    Reasons Why MLMs Are Worse Than Pyramid Schemes

    • 📉 The average return for a victim of a pyramid scheme is around 90% of their invested capital, whereas the average return for an MLM is around 30% of their invested capital.
    • 🚨 Even the people at the top of MLMs often struggle financially, with many losing money despite their high ranks.
    • 🤑 MLMs make money by selling overpriced products and seminars, rather than through legitimate business practices.
    • 📊 The financial figures seen on income disclosure statements are top-line revenue figures and do not account for additional expenses, which means even top members end up struggling financially.
    • 👥 MLMs target isolated cultural groups, such as Mormons and migrant communities, who are less aware of the industry's reputation and more trusting of their own community.
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    How MLMs Exploit Their Members

    • 💸 Members are encouraged to spend money on material displays of wealth to lure people into the business opportunity.
    • 📚 Top members host conferences and sell overpriced books, seminars, and courses, generating additional revenue with high margins.
    • 🚫 Members are told to cut off communications with friends and family who don't join the business, making it hard for them to leave the scheme.

    The Damage Caused by MLMs

    • 💔 MLMs ruin people financially, but also damage their relationships and social connections.
    • 🌎 Pyramid schemes may have never worked in the shadows to subvert democracy or run the world's largest mercenary organization, but some MLMs have done so with their multi-billion dollar fortunes.
    • 🚫 The business structure of MLMs forms multiple pyramids, each with a charismatic leader, and is heavily segregated by race and religion.
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