Anybody who is dedicated and talented to his work, outdoing his
peers, can succeed in any field he is good at(inc business);
doesn't have to be MLM. I don't see anyone in the top 10, top 20 or
even top 50 in the world's richest list doing MLM anyway. The like
to, and only can, cite this one person - Donald Trump. But sorry,
Trump made most of his fortunes thru real estates. And of course,
he should be relatively more succesful(as compared to his peers in
the same industry) in MLM because SO MANY pple know him, thru his
publicity stunts.
Not so. Again, as i emphasised many times, in the business world
today, size and revenue are not the main measures of good business.
Profitability measure against industry and quality of services and
products, plus cost efficiency are the mainstay. It is always
ridiculous to see people measuring large, non focused companies
like Wal Mart, against companies with focus on specialised products
and niche market, or to be correct, on few markets, such as
Microsoft, Amway and other such companies. Do you know in Singapore
alone, many companies are changing focus on mass market to quality
service, products and niche market. I can tell you heck a lot about
companies such as Pestbusters who goddamned compromise their
profits in exchange for quality and training. Such ranking of size
of companies can only make their way to magazines such as Times,
rather than serious business journals such as Harvard Business
Reviews. Companies are asking for troubles by having narrow minded
vision of targetting just size and revenue.
Yes, some people do make money in MLM, but how much? What's the
proportion of people earning? And how is the industry as a whole
doing? Anyway, if selling through MLM involves lots of overheads
and ending up overpaying these 'salesmen'(I do not see what other
role they are playing other than making sales), this makes neither
business nor economic sense; more inefficieny, less
competitiveness. I'd buy a non-MLM pdt any day, as long as it's
value-for-money, unlike lotsa MLM products. Remember, there's no
free lunch in this world. Earning loads of money in MLM means that
somebody have to pay for these services, where i still don't see
any products that's really solid and best in the industry such that
it deserves to be sold at a premium. Anyway, among the all coys
involved in direct-sales, the most successful firm in executing
this strategy is none other than Dell, ironically but not
surprising, non-MLM.
Again, its your observations. So far, none could provide
legitimate statistics on how the MLM industry is doing. I seen many
people only pick a handful out of the possible few hundred direct
selling companies in SG and make a judgement. Heck, in last year
Straits Times, they admitted they couldnt even get the right
estimates of people working in this industry. And, like the Coke
theory, everyone guess the cost of these products. Unless the stats
come straight out the company, how can you be sure these industry
observers are absolutely right?
Something worth heckling about your comments on products sold at
premium. While some argue costs are lowered by elimination of
marketing intermediaries, others are also right to say its being
raised to cover the commissions due to these distributors.
Seriously, any businessmen wouldnt care whether its right or wrong
to set prices at preimum, but rather, whether these premium prices
suits market demand, Again, these are the fundamental flaws of
price costing, than the marketing channel which is MLM. Its basic
business laws that boss should match their prices to achive demand,
and keep the company going. I wonder how can anyone attribute this
breaking of fundamental rule solely to MLM? This is
hillarious....
The 'MLM is the next wave' hype just reminds me of the dot.com
boom and ultimately very fvcked bust. People simply put their
money, buying in at atrocious prices, in these company which has no
value and sell sh!t products simply because this is the 'next big
thing'. Sure, there are people who made money, but only because due
to luck and psychological shrewdness(reading these idiots minds and
emotions). The majority of the people lost money - loads and loads
of it.
The prob with MLM is that it's fundamentally flawed. First,
almost all of them have lousy and overpriced products. Secondly, it
involves lots of manpower to promote and sell their products(the
traditional mode - advertising, made use of economies of scale -
screening to millions of people at one go - such that marketing
cost per product sold could be kept reasonable or even miniscule;
one man displaying and selling a handful of products at a time,
compared to Walmart, with one store and a few employees displaying
and selling loads and loads at a time), thus jacking up the price
further more. Third, people join in less because they like the
product nor have a good impression of the products, but more
because they just want to make money - loads of it. Fourth, even if
the products are very very solid, almost all the companies do not
have a cap on the number of people allowed to join, ultimately
resulting in fierce competition among networkers for business of
the same products since there are so many of them and thus, their
individual income as a whole is still very limited.
Again, this paragraph clearly shows your perceptions.
The general health of MLM companies remains to be vague and very
much mysterious, since almost all of them are not listed in the
stock exchange. Even, the largest of them all - Amway - had been
delisted from NYSE some years ago. And, I also find the fact that
James Phang receives 5% of revenue(this is not even counting the
other portion he'd be receiving for his stakes in the coy) for
every product sold is too much and unreasonable. C'mon, even
McDonad's charge their franchisees only 8% of revenue, to be paid
to the thousands of executives and staff in the headquarters as
salaries and yearly bonuses, to pay for the cost for the lease or
real estate, to pay the gov as taxes, to pay for advertising and
other marketing campaigns, with the end profits to be distributed
to the millions of shareholders, etc. And that Phang wanna get 5%
for free? No way!
Yes, this is true, which actually contradicts your first few
points. Until someone make a thorough observation of the whole
industry, I would never speculate on these few aspects you touch
on, whether its good or bad. Thats why I make my judgement or
arguments solely on specific or individual companies, than making a
generalisation of the whole industry as you have done.
At the end of the day, business success cannot run away from
these fundamental factors - desirable products at a desirable
price, good marketing(MLM may come into this, but it's subjective),
good accessibility, and ability to keep costs low. Forget these,
and you can forget about everything else.
This whole paragraph is damn true, but it sticks out sore thumb
when someone read through your whole post.... 
