MLM DEFINED

It is an interesting fact that thought there are millions of people working in the Multi Level Marketing business model, most of them are unable to define this ‘MLM’.  Companies try to define it the way their business model is functioning, and try to prove that all other models are wrong.  This lack of clarity has created confusion amongst the regulators and Government authorities.  

In actual terms companies who are involved in genuine product based business are in DIRECT SELLING using a Multi Level Marketing Business Model.  Here we are trying to define the model

Multi Level Marketing, which is also called as Network Marketing is a Direct Selling distribution model where a Company markets its products through independent sales agents/affiliates/distributors/members or any such other names which in general can be called as Distributors, where the distributors themselves become the consumers and also promoters of the products and services of the company and for whichcommissions or discounts are being offered.  Moreover these distributors can recruit/refer more distributors and they in turn can refer more distributors with the sole intention of increasing the sales volume of products within that distributor’s network and whereby the company pays not only for the distributor’s personal sales/consumption but also for the business volume generated by the sales/consumption volume of all the downline distributors under him based on a published compensation plan.  Every distributor can buy products/services directly from the company or its affiliated merchant stores either physically or electronically and doesn’t require to operate an inventory.

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