The Truth?

I ran across a great article titled The Truth about Network Marketing by Crystal Tein. In it she talks about what network marketing is, how it works, and why it is here to say. She makes a great many points, many that I agree with. One that stood out to me is something that I have written about before.

"Many distributors have argued that in network marketing, this is avoided as the product goes directly from distributor to consumer, making the product less expensive and relatively cheaper. The argument that it is cheaper is the point that I seek to discount.

Although the products in network marketing do not need to go through the multiple channels of distribution, the incentives offered to distributors far exceed those of the salaries of the typical retail assistant in traditional business models. In the company that I was working for, for instance, top distributors are given a car and a fund for car maintenance. In addition, normal profit margins of the typical distributor are higher, high enough to add on to the cost of the product. In addition, in some network marketing companies, top distributors also get to have a cut of their companies’ profits.

Thus, it is not true that the products of network marketing companies are cheaper. If one really breaks down the budget, the prices as compared to traditional business companies are comparable."

When I was in Quixtar they never really claimed that since their products didn't have to go through a normal distribution chain that there products would be cheaper. What they said is that extra money would go to us the distributors. Which is if you think of it means basically the same thing. The members of the MLM or Network marketing company are the distribution chain. Hence why they are called distributors.