Multi level marketing (MLM) is a work from home distribution business in which a company markets their products directly to consumers by relationship referral and direct selling.

The people marketing the products are referred to as independent distributors or independent business owners.    They are not paid a salary by the parent company.    Their remuneration is based on commission earned by  volume of  the retail sale of products purchased from the parent company.   The parent company will also encourage the independent distributor to build and manage his/her own sales force by recruiting, motivating, supplying and training others to sell the products.   Hence additional income/commission can be made by  distributors based on the retail sales and recruitment efforts of their down line.   There can be multiple levels of people receiving royalties from the sales of one person.   

Financial investment is required upfront for the purchase of a "start up" kit which usually consists of  retail products.   The amount can vary and will depend on whether you want to work part time or full time or whether you are interested  purely retailing the products or  you have higher ambitions and want to start your own full scale business .                

Although it is possible to build a successful multilevel business with comparatively little start up capital, be warned that it is not a get rich quick scheme.   Successful distributors who recruit and train a large number of sellers, also have to assume ongoing  wholesaling and managing responsibilities as well maintaining and serving there own retail customers.    Managing  such a large operation can be very profitable, but requires hard work, perseverance and discipline and will be a full time job.

Multi Level Marketing is very attractive because it sells hope, by promising that wealth and financial freedom can be easily attained by working from home.   MLM is a powerful and effective marketing system, however, for every one successful distributor, there are a large number who do not succeed. 

Some Multi Level Marketing Companies are household names and have been in business for a many years.   Before making an investment your are urged to check out the company with your local Better Business Bureau (BBB) for a reliability report.

 Watch out for "PYRAMID" schemes.   They concentrate mainly on quick profits earned by selling the right to recruit others.    Unless you recognize the tactics of of a "PYRAMID" scheme, you may find yourself tempted to become involved.   This is an example out how they operate.

You have been invited by a friend, neighbor or colleague to attend an "opportunity meeting" to find out how you can earn an enormous amount of money.   You go, thinking this may be a way to build a business,   In a frenzied, enthusiastic atmosphere you are told how easy it is to realize a fantastic return on your investment.   A smooth talking organizer may try to convince you that his plan is an exciting short cut to riches, easy living and early retirement.    To invest you are usually required to invest a substantial amount.   They may tell you that you don't have to invest, but it is clear you are expected to, or would be a foolish not to.

You are confused and not really sure what the product or service is, or how it is going to be sold.   Instead, throughout the meeting it has been stressed that all you have to do, apart  from investing your money in the program, is to get others to invest.   The plan focuses more on the recruitment of other participants than on selling a product or services.

In order for everyone in a "PYRAMID" scheme to profit, there would have to be a never-ending supply of potential and willing participants.   Obviously this is not possible, and when the supply runs out, the "PYRAMID" collapses and most participants lose their investment.              

The really sad part of "PYRAMID" schemes is that they usually target and exploit people who can least afford it, people with limited means and business knowledge.   Thousands of unsuspecting and trusting investors have lost millions of dollars in "PYRAMID" schemes.    Many people and especially retirees  have been scammed out of their life savings.

Bear in mind that "PYRAMID" schemes are illegal throughout the United States.    Please be wary when the "start up" cost is substantial.     Legitimate Multi level Marketing companies usually require a small "start up" cost, whereas "PYRAMID" schemes pressure you to pay a large amount to become a distributor.