Network Marketing is a method of distribution and compensation that has been utilized in the United States for over 50 years. The Direct Selling Association (DSA), based in Washington, DC, represents the Network Marketing industry. The DSA has existed for more than 100 years.

Over 1,000 Network Marketing firms distribute well over $50 billion dollars a year in goods and services. An estimated 8 to 10 million Americans are either part-time or full-time distributors.  The industry has created more millionaires than any other industry, and millions of people are customers of network marketing / MLM companies.

The common myth about Network Marketing is that the Top Guys make all the money off the little guys.  The people who circulate this myth are usually those who define fairness in terms of everyone receiving the same benefits regardless of their efforts and contributions.  Or they may frequently be folks who tried and failed in a network marketing business.  Many times they are the folks who believe that those who sit around and do nothing to earn their share should be paid the same as those who have been working and effectively promoting and contributing to the organization.  This is not what network marketing is.  A viable network marketing /MLM organization is one of the fairest compensation mechanisms in the world because it will reward based on “Deserve” not on “Want or Need”.

Network Marketing actually does work, and work well. Those who train, refer and motivate the most people earn the most money.  A viable network marketing compensation plan will allow someone that comes in on the bottom level to go on to be a top earner while the very first person enrolled in the organization may make nothing. 

If you sell or consume $50 worth of product a month, and you have referred 50 people who do the same, you will earn 50 times more than the person who only sells or consumes $50 of product a month regardless of where you are within the organizational structure. That is a viable MLM compensation plan.  Is that not more fair than most? Why should you do all the work only to receive the same income as someone else who did nothing?

Pyramids

Pyramids - A Pyramid is a structure where those at the top make more money than those below? This describes nearly every traditional company in existence! The problem here is that the CEO is the recipient of the efforts and hard work of each person below and these people do not have the opportunity to earn as much as or more than the CEO. Does a Vice President earn more than the CEO? Does the factory worker earn more than the plant manager? No, almost never.

No matter what effort the factory worker exerts, they still maintain the same level of income and status. They will almost never have a higher income than those in upper management. This is how a Pyramid works.  Those at the top make all the money while many others earn little and do the bulk of the work.