Network marketing can be one of the most fulfilling ways to earn an extra income. It is work that you can do part time or full time. With multi level marketing, you have the flexibility of choosing your own working hours as you earn money that is commensurate with the amount of effort you put in. Unfortunately, like with any other good business opportunity, there are potential pitfalls too. The best way to avoid illegal and scam network marketing companies is to source for network marketing legal advice from a lawyer that is conversant with all laws and regulations that touch on multi level marketing in the area you intend to operate in.
But what are these pitfalls? None is more prominent than pyramid (or ponzi) schemes. Many pyramid schemes try to present themselves as legitimate network marketing companies. The reason they find this easy to do is because even though pyramid schemes are illegal in most jurisdictions and network marketing is legal, the two have a number of similarities that can lead an unsuspecting person to join a pyramid scheme convinced of its legitimacy. Despite the similarities, there are clear differences between the two that engaging the services of a lawyer for network marketing legal advice can help you indentify and avoid falling prey of a pyramid scheme.
So what are the differences between pyramid schemes and network marketing organizations? First, pyramid schemes emphasize and solely thrive on the recruitment of new members. Commission is based on the number of new people you bring into the scheme. But since there are only so many people that can be recruited to join the scheme, the pyramid falls apart when few or no new people are being recruited.
In network marketing, you also expected to recruit new members to better your chances of earning more from the program. However, network marketing companies are primarily focused on selling products or services. A percentage of the sales you and the people you introduced make is what you receive as your commission unlike a pyramid scheme where you are paid based on how many people you recruit. Even when there is a product, pyramid schemes ignore or give little importance on selling the product or service. An organization that focuses more on recruitment than on selling the product is one that any competent lawyer you engage for network marketing legal advice will advise you to steer clear of.
Another characteristic of pyramid schemes is the huge start up/initial costs required to join in. To become a distributor in a pyramid scheme you will be required to pay high joining costs or purchase a large number of products. Legitimate network marketing organizations on the other hand usually have small start up costs. What's more, there is often little or no market for the products you are required to sell by a pyramid scheme while a network marketing company will only push products that it knows attract substantial demand from the market.
Legitimate network marketing companies also provide training on sales and marketing to assist you in marketing their products. Pyramids rarely do this since they concentrate on recruiting more and more people. Network marketing legal advice is thus important to help you make the right decision when picking the ideal network marketing company for you.
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