According to the Direct Sellers Association, Multi Level Marketing , also known as Multi level Marketing, had its start in the early 1900's. It has become popular in recent years through companies such as Amway and The Fuller Brush Company.

A true Multi-Level plan is one in which there is an agreement between yourself and a manufacturer or distributor to purchase products at wholesale and sell them at retail, also with the right to sponsor others (your down line) thus multiplying your sales base and profits by receiving a percent of the sales made through your downline. Persons you sponsor show others the program and sign them up as members under themselves. In effect you are multiplying your efforts by selling the product through a network of distributors. The downline is usually set up at three to five levels deep although it seldom gets that far, especially if it is a multi-level program being circulated through the mail or on the Internet.

A small initial investment is all that is usually required to become a distributor. You should have a flexible schedule but little experience is necessary. For you and your distributors to have any kind of success, you must handle high quality items which can be sold at substantially below retail store prices.

Distributors are charged for the program packet which includes instructions, literature, samples, etc. To be legal, the investment must be only a nominal amount. Sale or consumption of the product must be the prime objective and no fees should be collected for recruiting endeavors.

A common problem in recruiting people is getting them to "Look at the Plan". If they have seen network marketing [multi level marketing] plans before they won't give anyone a chance to explain the program as they think they already know all about it. Some get around this by inserting an ad in the local paper or signs posted around the neighborhood, asking interested parties to call by phone or contact a Web site on the Internet, about "a good money-making plan". They use a telephone answering machine which advises the caller where and when to attend an "Income Meeting". The machine doesn't give them a chance to ask questions. If they are interested and not just curiosity seekers they may show up for the seminar.

Multi-Level selling by large party plan firms are often successful because they keep their members productive through a series of coaxing, weekly meetings, phone calls and home visits. This stimulates activity and better results are obtained. These elements are missing in multi-level mailorder or Internet marketing based programs. There is no motivation, inspiration or force applied to downliners. The meetings and personal contacts that represent strength are missing when the business is conducted by mail or by the internet. Therefore a good many of the multi-level mailorder or Internet marketing programs can not work and are basically worthless, especially on a 4 or 5 level down line position.

A typical multi-level [network marketing] get rich scheme is where you are offered a book selling plan for $5.00. You are assigned a code number and mail out 500 brochures. When your name reaches the fifth level you are supposed to have collected something like $50,000 in commission for 100,000 books which sold for a total of $500,000. This is based on only 10 orders received by you and 10 orders received by each of your downliner's who also mailed 500 brochures.

If only 10 people in the entire United States initially worked this one plan with the same success you are supposed to have, there would be 5,000 brochures out the first level; 50,000 the second; 500,000 the third level; 5,000,000 the 4th level, and 50 million in the 5th level. That would amount to some $11,000,000 in postage with brochures delivered to over one-half of the 90,000,000 mailorder buyers in the U.S.

This type of program will collapse under its own weight. After one level there is usually a complete drop-out.

Most such plans get started because of exorbitant, dishonest claims. Tell the truth in an ad on Multi Level Marketing and there are very few takers. Change the ad to greatly exaggerated claims, such as "Earn $100,000 a year working from the home part time" and the inquiries pour in. The response on this kind of ad doesn't mean that anyone will make any money!

There are too many ways to make an honest living without telling lies so keep your Multi-Level plans level!