MINNEAPOLIS (WCCO) — Multi-level marketing firms often tout full-time income on part-time work, an incentive strong enough to attract more people into the industry every year.
The Direct Selling Association, the trade group that represents multi-level marketing firms, estimates as many as 330,755 Minnesotans work in this type of business.
The main things to compare, according to Hamline University professor Stacie Bosley, is the retail side versus the recruiting aspect.
The sales part can vary from face cream, to jewelry, to environmental products and beyond. Bosley says the more a company prioritizes that side of the business, the better.
Recruiting involves pulling people from social and personal networks to come on board.
The people recruiting others are considered the upline, those getting recruited are considered the downline. If that’s the main focus, she says, it could suggest a pyramid scheme or, at the very least, it can be really hard for people to get out.
“There can be a very strong, almost familial connection with those people,” said Bosley. “So you feel a sense of obligation… the things that I do impact my upline, the things I do impact my downline. And so there’s a different social bond and connection that can be formed that makes me feel like I need to stick with this for other people’s benefit.”
The other key she mentions in order to have a shot at profitability is timing. One reason why it’s so hard to make money in this type of business is because people are essentially recruiting their competition.
Bosley urges people interested in joining a multi-level marketing firm get into it early and know when to get out.