Why are MLMs allowed to work?

Multi-level marketing: MLM promising alternative for founders?

If you believe the promises, MLM makes getting rich a breeze. And there are actually many people for whom this has worked. Now everyone defines "rich" in a different way, so let's say many have success with it. I also have positive examples in my own circle of friends, be it in the Tupperware sector but also in the field of dietary supplements and cosmetics. These people all have one thing in common. You are by nature very open-minded and have a very convincing nature, without being intrusive and pushy. In addition, they are absolutely honest - if they are not entirely convinced of products from their range, then they say so too. Serious MLM providers accept such a thing, with others it quickly leads to exclusion from the company. Talent plays a big part in the whole thing. Nothing gets worse with customers than stilted-sounding, memorized phrases from the seminar for sales tactics. Anyone who is not a strong personality and is endowed with a lack of self-confidence quickly runs the risk of coming under immense pressure from the expectations of the higher hierarchies and the constant public comparison of successes and failures.

Another point that is always viewed very critically is the pyramid effect: the higher you rise in the hierarchy, the less you have to work for your earnings, as the commissions passed on lead to what is known as a self-running effect. You no longer have to sell yourself, just motivate. There are even legal regulations intended to prevent such business practices (in Germany: Section 16 (2) UWG). However, this is a gray area. A vehement critic of MLM was Harry Zingel (d. 2009), whose statements the founders' dictionary published in the series "Multilevelmarketing".

That too has come under fire Tupper system. Due to their sales success alone, women sometimes unintentionally slip into a management position - without commercial knowledge or equity - and bear the entrepreneurial risk. This often ends in complete debt. The film contribution to "The Story in the First: System Tupperware" is available in the ARD media library. (Video only available until July 15th, 2014)