Okay, time to answer the question.
MLM = Multi-level marketing, a marketing strategy that is based on
direct selling of products to consumers.
The seller gains a percentage of the profit made through selling
the products.
The product, basically, regardless of the claim is not the
key.
The key is the consumers. They direct their sales at friends,
relatives and past associates.
Usually the %age of the profit earned by the seller is fixed by his
position, the introducer (the person who introduce the seller)
gains a %age of the profit equivalent his profits for his position
minus the introducee's. And this list goes on until a certain level
where a person who will gain the remaining profits for the base
sales.
Thus, assuming A sells the product. A is supposed to gain 5% for
the sales. This is direct profit for the seller.
B introduced A and B is supposed to get 15% for his sales, B will
gain (15-5)% of the profit.
C introduced B but C is at the same position as B, so C gains zero
profit, but still accumulates points (which will help upgrade the
position)
D introduced C and D is at the highest position. D gains (35-15)%
of the profit.
This is called indirect profit for D and B.
As D has achieved a certain position in the company, D will gain
profit from the pool equivalent to his position say he gets
10pts.
The total pool pts is 251, D will get from the pool, 10/251% profit
for the sales for the month.
That is pool profit.
The products, thus, may be sold at a price triple to four times its
original manufacturing cost depending on how the company decides
the pool, gain and sales.
The credible part of this system is that, it is indeed a fast
scheme to wealth as long as you're the first few top seller.
Your network, of introducees, will actually, work to increase your
sales volume.
The problem with this system, sellers may be overly concerned over
sales and thus vent their frustration on family, friends who had
taken up their so called precious time listening but refusing to
purchase.
