MLM means that MLM organizations sell or provide services through multi-level (MLM) and independent distributors. Each distributor can not only sell goods to earn profits, but also introduce and train others as new distributors and establish a new sales network to sell the company's goods. While the company gets more profits, each dealer also gets the corresponding price difference in his own sales network. MLM is popular all over the world, so MLM enterprises get the difference profit of a large number of goods, not the commission. It is precisely because of the huge commercial profits of pyramid schemes that some unscrupulous businessmen use pyramid schemes to carry out illegal pyramid schemes, turn legal pyramid schemes into illegal forms such as "network chains", collect money in disguise, and defraud the masses, thus triggering various crimes with the pursuit of property as the core of illegal pyramid schemes. MLM originated from the genius idea of two mathematics students at Harvard University. At first, they only studied multiplication, such as the mathematical model of 1 2, 2-4. Later, it was quoted in marketing and became a pyramid scheme.
The obvious characteristics of pyramid selling:
(1) The price of pyramid selling commodities seriously deviates from the actual value of the commodities themselves, and some pyramid selling commodities have no use value and value at all, and the service items are purely fictitious;
(2) The income obtained by the participants is not from the reasonable profit of selling products or services, but from the fees paid by others when they join.
MLM is a virtual economy, which belongs to financial fraud in China. It has three biggest characteristics,
1. Take the membership fee as the profit point,
2. Take high returns as bait.
3. Development under the pyramid line.
MLM can be divided into the following categories: violent MLM, traditional MLM, new MLM, online MLM, legal MLM and unprofitable MLM.
1, violent pyramid selling, the most primitive pyramid selling, uses restrictions on personal freedom or even kidnapping to achieve the purpose of pyramid selling. Some people don't even know what the product is or nothing. It is rare now.
2, the traditional pyramid scheme, with classes, brainwashing ways to let people voluntarily join pyramid schemes, there are products but simply can not afford. The MLM organization will restrict some of your freedoms, such as making phone calls and so on. This is the pyramid scheme of tens of thousands of people that we often see. The above two are the targets of government crackdown.
3, the new pyramid scheme, some products can also be consumed, but the price is higher, completely free, you can do whatever you want. Of course, it's hard to say if you pay the membership fee.
4. Network marketing, using virtual products such as point cards and video advertisements to defraud membership fees. In today's society, this pyramid scheme is the most common and hard to prevent. In view of this pyramid scheme, we should focus on prevention.
5. Legal pyramid selling. Enterprises operating in offline mode approved by the government are generally relatively large, and their products can be consumed normally. You can operate independently or jointly, and you only need a certain initial fee. For example, cosmetics, chain stores, logistics and express delivery companies.
6. Non-profit pyramid selling, a non-governmental organization that develops in an offline way, but does not aim at joining membership fees for profit. Like a religious organization.
So how can we prevent pyramid schemes in the process of employment and part-time?
First, don't believe that pies fall from the sky. The most commonly used phrase of MLM company is "let you make money while spending", which is nonsense. Consumption is consumption, and making money is making money. Treat consumption as a job and never make money.
Second, there is a rule in the business world that all relationships must be established by signing contracts. Contract is a necessary tool to ensure equality and mutual benefit of both parties. Especially the labor relationship between companies and individuals, China's labor contract law stipulates that contracts must be signed, and regular companies will take the initiative to sign contracts with you. If the other party doesn't talk about the contract at all or even refuses to sign it, then he must be dishonest and stay away from him.
Third, don't get emotional. MLM companies are usually acquaintances looking for acquaintances. There is a saying that friends don't talk about business. There is some truth in this statement. Don't hurt yourself because of your friends' feelings. Some people, as long as their friends invite them, do it in a shady way without asking anything. As a result, they fell into a puzzle and could not extricate themselves.
Fourth, review qualifications. Whether you join a company or accept the promotion of a company, you must first understand the qualifications and credit of a company.
Say no to illegal pyramid schemes, we need you, me and him.