This organization follows a Multi Level Marketing business model. In history this model has never succeeded and has very serious consequence and affects numerous people. Example Amway, modicare, etc. There
are more than 17 companies which has followed the same strategy and some are still running. In this model there are few basic traps
1) You have to pay Rs.33,600 in advance before joining the organization or immediately after joining the organization
2) You have to join your friends or relatives in the same business for you to get paid You have to join 6 of them for you to get one payment. So nearly 1.8 lakh is the amount that goes to company out of which you are given Rs.11,600. Why do you want to cheat your friends and earn??????????
3) There might be some products that you have to buy which are costlier like 7 gram gold coin for 33k which actually costs 6k in all jewelery shop
.
By these points you can identify the MLM strategy of the company. How you get paid is through the friends whom you have joined below you in the network. They pay a big amount to the company, out of which you are paid a part of it. If you are given some products, those arehighly costlier than the outside market. For the cost the company people and the members give thousands of explanations which are completely false. You will get a commission amount for the sales of the products which people below you in the network bought. So the money you get is the part of the money which is lost by the people below you in the network.
The company gets profit in two ways
1) The products which you buy are most of the times costlier. These products does not have any marketing expense or the sales cost, because the members themselves are the market and they do the sales. They usually do not have after sales or anything of that sort.
2) When each member joins they have to pay a huge amount for which the new member is given some crap product which is highly over valued.
Some companies use a lot of other ways to get in money, but these are the standard ways.
How people are fooled!!!!
1) These people are motivated only by the money which they are going to get when lots of new members are added in their network.
2) They are told false information about how the company makes money and how they are paid. The members are told that they are paid by saving the marketing charge and sales but that is a false information. They are paid from the amount spend by the people he has joined in the network below him.
3) They never think what will happen if they are not able to join someone below them in the network, reason might be all of the friends are already in the chain or they are not willing to join. So the guys in leaf node will be ultimate losers. In any network tree construction about 30% to 70% of the members will be in leaf node.
4) Comparing with coke and Pepsi business, gmail reference strategy and others are total crap which any one with common sense can understand.
People who enter this business are getting cheated and they cheat their trusted friend and own relatives, your friendship and relationship is in trouble. If a guy in this business tells that he has earned a lot of money then it means he got many of his friends in trouble. Please avoid getting cheated and avoid cheating. Words may be harsh but thats the truth. MLM business model is a chapter in MBA subjects, that is an example of worst business model.
I would like to recommend that you check out the following links. These pages will explain more:
What’s Wrong With MLM--FAQs
http://www.vandruff.com/mlm_FAQ.html
The Zero Sum Theory MLMer Tom "Big Al" Schreiter on MLM
http://www.mlmcentral.com/library/zerosu...
MLM Watch: A Skeptical Guide to Multilevel Marketing
http://www.mlmwatch.org/
The Network Marketing Game Dr. Jon Taylor, who did the Network Marketing Payout Distribution Study
http://whatisgood.com/nwm/
Worldwide Scam
http://www.worldwidescam.com/
MLM or Pyramid Scheme?
http://factsource.com/srmlm.html
Cagey Consumer MLM and Financial Scams Exposed
http://www.geocities.com/WallStreet/5395...
False Profits Analysis of Network and Multi-Level Marketing (MLM)
http://www.falseprofits.com/
and coming to people who joined will get dumped.....
Hope this info. was useful to u....
I wish u good luck...
Happy investing...!!!!