In recent years, MLMs have gotten into telecommunications, including local and long distance services and cell phones. Others have developed online services or website products. Today, virtually everything is available from an MLM. Over 2,000 companies in the United States are MLMs and they made over $28 billion in sales in the past year. MLMs employ 13 million people as independent sales people.
Unlike traditional companies that sell to the public, MLMs work on the principal of relationship marketing. Each distributor sells to his friends, family and co-workers. Usually, one of these individuals is interested in becoming a distributor and will sell to his friends and relatives and so on. The system works because each distributor has a vested interest in making it work. The distributor receives a percentage of the sales of the people he has recruited. As well, each distributor is also a consumer of the product being sold. Product and brand loyalty is fierce. There is no need for a store. Everything is sold direct to the consumer and the actual products are shipped to the customer from the MLM warehouse.
A distributor has only so many friends and relatives. What...
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