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New Business Venture or Pyramid Scheme?


Four Layer Puzzle With Person on Each Puzzle Piece. Puzzle Forms a Pyramid with Red Person Icon On Top.

Multilevel marketing (MLMs) could earn you some money but they always carry a risk. You may have even heard the term "pyramid scheme associated with MLMs. Before going into a new business, make sure that the income you earn is based on the sales of the product to other people. In a pyramid scheme, the income is generated by recruiting more people and your sales to them, not to the general public. Remember that pyramid schemes are illegal!


Before signing any papers, make sure you understand how you will be paid and any potential expenses including samples, training, and marketing materials. You should also know what happens to unsold merchandise, whether you are expected to pay for it or if you can return it to the manufacturer. When getting this information, make sure that it is in writing.


Another tip is to search online for the brand and product to get a gauge of its reputation. If it's a health or beauty product, what do health and beauty professionals say about it? Are they priced competitively? If the product includes "miracle" ingredients, it is most likely a scam. Many of these ingredients are unproven, useless, and could even be dangerous.

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