This post is part of a series of posts about THRIVE Life (formerly Shelf Reliance), pyramid schemes and MLMs. Read more here: THRIVE Life: Is it a pyramid scheme, MLM, or something else?
Concern #3: In an MLM, Only Those at the Top Make Money, Right?
This is a claim often made by those who do not trust the MLM idea. I used to be one of these people! And the truth is, it does seem to be true and quite unfair! Those who have only been in the business for a few months or even a year aren’t making much compared to those “at the top” with large “teams!”
Those “top leaders” talk about making hundreds of thousands or even millions. It doesn’t seem fair, right?
In some MLMs this occurs b/c the company limits the number of people you can “enroll” directly underneath you. This means that the only way to earn money is to create a TRUE pyramid (you enroll 5 who all enroll 5 who all enroll 5 and so on). But since you only earn a small percentage of your “team’s” sales (say 1%-7% typically), only someone “at the very top” of a LOT of people earns a real income.
This is a problem because by limiting the number of people I can enroll directly, the company takes away any control I have over my team growth. For example, if I can only enroll 5 people directly underneath me, what happens when those 5 people don’t enroll anyone else? Then, I’m stuck and I have no control over creating a larger team. I have to wait for those 5 people to work because my team can ONLY grow as a pyramid. It is impossible for my team to be heavier on top then on bottom. That is a problem and MLMs that are set up this way typically only have a few people who got lucky making a real income.
However, those types of MLMs are actually the exception and are borderline illegal schemes. Most MLMs (including THRIVE Life) allow you to enroll as many people directly underneath you as you’d like to. This gives you a lot more control over your team size. Even if no one you enroll decides to enroll someone else, you can still have a very large team based on your own efforts. In fact, my team THRIVE Life team is actually an upside down “pyramid” meaning I have a LOT more people directly under me than I do a few levels deep. (-:
Typically those who complain that only those at the top of an MLM make any money understand that in most MLMs you can enroll as many people as you’d like to. They are talking about this “barely legal” situation. Instead they claim that the “only at the top” phenomenon is because of market saturation. In other words, since you make money by recruiting and there are a limited number of people who want to be recruited, eventually, there will be no one left to join the teams of “those at the bottom.” So, they can’t make any money.
Answer to Concern #3
It is unfair to apply this idea to only the MLM industry. It is true of any industry. I knew many, many people in high school who wanted to be doctors or lawyers, but now, 15 years later, the vast majority of those people are NOT successful doctors or lawyers or business owners. I would guess that less than 5% of them are. Is this b/c there is now a market saturation of doctors and lawyers and business owners? No! Each year, there are doctors, lawyers and business owners who retire and there are a new group of graduates ready to take their place.
The truth is, anyone with the willingness to work hard and spend the time can become a successful doctor, lawyer or business owner. It is the hard work and time that naturally eliminates quite a few people from making it to the “top!” Not everyone really gets how much work and time it takes to get there, and they give up before they see success. In other words, only those “at the top” are successful.
So, what defines being “at the top” for doctor or lawyers? It isn’t because they “got in early” before the “market was saturated.” It is because of Hard Work. Dedication. Time. No one decides “I’m going to be a doctor!” and then starts making hundreds of thousands a month or two later! No one decides, “I’m going to open a restaurant” and is making millions within a year. Yet people expect these types of results from the MLM industry. They expect the newbie to be making just as much an an experienced distributor.
But the reason “top leaders” or in other words those with large teams make the most money is because they’ve been working at it for a very long time. Just like in the medical, legal, or private business markets, anyone willing to invest the hard work, time and dedication can be successful in an MLM. Just like any other industry, there are those leaving it and those just getting old enough to join it. There is no “market saturation.”
The problem is that most who join MLMs expect them to be a “get rich quick” business. These people are like my friends who wanted to be doctors, lawyers or business owners, but had no real idea of the work that would take.
The fact is that legitimate MLMs (including THRIVE Life) aren’t “get rich quick schemes.” They take time, patience and hard work. If you talk to “top leaders” (those making full time income) in a legitimate MLM they will tell you that they made pennies on the hour at first just like everyone else who first joins an MLM. The difference is they saw their first few years in their business as an investment (like a doctor sees the cost of Med school) into something greater. They were willing to give it the time, dedication and hard work that it took.
That being said, there are some MLMs in which an extremely low percentage (less than 15%) make any money at all. This is usually true when the commission plan is very heavily weighted on recruiting instead of on selling. When you first start,there is simply no way for you to immediately recruit a large team. And not being able to make any money at first is discouraging! While full time income may not happen until you’ve been in the business for a while, ALL consultants making an effort in their businesses should make some money, right?
With the THRIVE Life commission plan, you can easily be profitable in month #1. And even if you never decide to “build a team,” you can still make a great supplemental income (a couple of car payments each month) on just your own sales.