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Steer clear of These Network Marketing Swindles

by Larry Franklee

How are you able to tell the difference between a valid MLM opportunity and one of those network marketing cons or ponzi scams everybody has warned you about?

What's the difference that makes all of the difference? Is there a fast way to sieve the wheat from the chaff, gnaw the protein and spit out the bones, and protect you and your pocketbook from being taken for a ride? Let's dig slightly deeper into the subject handy and find.

Network Marketing Cons Defined

MLM compensation plans, also known as "network" or "matrix" marketing, are a method of selling goods or services thru a network of independent contractor, distributors or direct sellers. Amway is one of the biggest, most well-known network marketing firms. They have millions of active distributors worldwide and produce yearly sales in the billions.

Traditionally, Amway has fallen victim to the "network marketing cons" label several times. But in every case, including a 1979 FTC investigation in the US, a 1997 Belgian legal action and a recent 2008 court judgement in Britain, every fake claim was discharged.

In short , the FTC found Amway not guilty of being an illegal pyramid operation or just another one of those network marketing stings because "distributors are not paid to recruit people and have to sell products to get bonus checks, and the company was committed to purchasing back its distributors ' inventory overstock.

Network Marketing Cons Made public

In a legitimate network marketing opportunity, commissions are earned only on sales of the corporation's products or services. Commissions can be paid on both high street and wholesale sales. But no cash may be earned from hiring other people as a distributor. Put simply, you can't make a dime from sign up costs. If a company pays out a sign up charge, chances are it'll fall into that feared network marketing scams category as it then becomes an illegal pyramid or ponzi scheme.

Defending Yourself Against Network Marketing Swindles

Every year there are countless hundreds of new network marketing companies launched around the world. Like most tiny businesses, many of them won't survive a full year in business. Others will drop by the end of year 2 and very few will continue to be around by the end of year 5.

The most effective way to protect yourself against becoming a victim of one of these network marketing scams is to position yourself with a proven company which has stood the test of time and legal examination. As an example, Nexera.com hosts an annual list of the top 25 MLM corporations that fall into this standards :

* The company offer a multi-level compensatory plan. * The company must be in business for no less than 10 years. * The company must have a Google Page Rank of one. * The company must have an Alexa Rank. * The company must show up in Google Trends.

Naturally, much of this factors has nothing at all to do with the legality of any actual company or its marketing model, but if you align yourself with a stable company that has been around more than 10 years and has a well-known online presence, you significantly decrease the risk of falling in yet another one of those "network marketing scams".



The following is where you can find out more. <a href="http://teresagriffith.com/network-marketing-scams/">Network Marketing Scams</a>.

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New Unique Article!

Title: Steer clear of These Network Marketing Swindles
Author: Larry Franklee
Email: leads2income@hotmail.com
Keywords: network marketing,scams,mlm,business
Word Count: 531
Category: Marketing
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