I once spoke at a businessmen’s seminar in a large church in Africa where the senior pastor was my interpreter. One of the points I made was that Christians should not be involved in MLM. Some people were particularly annoyed and in the Q & A time asked why. I fumbled for reasons but in retrospect should have deferred to the pastor to explain why a Christian shouldn’t be involved in a marketing scheme based on greed. A few people walked out and the atmosphere was a bit tense. Unbeknown to me, the church was embarking on a MLM program involving the pastor and number of the church members. Months later I found out that God spoke to them though what I said and they didn’t go through with it. I was greatly relieved for it would have ripped the church apart and destroyed a rather significant work of God.
I learned a few things though that experience.
1. If I am not prepared to defend a brash statement, I should keep my mouth shut.
2. Don’t try to fix everything myself. Defer to another’s wisdom.
3. Be better prepared when speaking to intelligent people.
4. God is gracious to me and will even speak through a donkey if need be.
Now about MLM, let me tell you my experience. In 1963, A neighbor invited me to a meeting about a tremendous business opportunity. They were direct distributors for A_ _ _ _. I prefer to call it scamway. I turned up at the most prestigious hotel in town, sceptical that anything would come of this. There was a lineup of Cadillacs at the entrance with the company’s logo on each of them. I later found out they were all rented for the occasion. I think they call it “fake it til you make it.”
The meeting was packed with about 3,000 enthusiastic followers. The speaker gushed with superlatives about the soap as though it was the greatest thing since sliced bread. Most of his speech centered around the copious amounts of money he made, how little time each day it took and how everyone could do it. I felt myself being drawn in. Could I really make that much money with such little effort. All I had to do was eat, breath and think A, so that it would be part of everything I did. Soon it would come out of my pores as I immersed myself in the program. Making lots of money would come as a natural outcome. Praise be to A.
Like a lamb led to the slaughter, I forked over $40 and got a plastic attaché case full of products with instructions. I even got a membership card with my name on it. It’s still in the top drawer of my desk to remind me of how stupid and naive I was. With all the enthusiasm of a teenage evangelist, I decided to try out my new found faith on one of my neighbors. When I did the prescribed test, her soap turned out better than my soap. I tried vainly to justify how it was really concentrated and didn’t need to foam as readily. It would eventually outperform hers and cost less in the long run even though it cost more initially. She didn’t buy the BS so I returned, humiliated, to the direct distributor for more ammunition. Make a written list of all your friends, relatives and especially your church members. They are most likely to trust what you have to say. There’s another meeting next Friday. You need to be more excited about the program. The real money is made in signing up converts, not in selling the soap. In the meeting they layed out how to build your dream of untold wealth by first using the list then branching out to everyone you talked to. Everyday you meet people who need our products and you just need to be convinced that they are the best.
Well I wasn’t convinced and I started to smell a rat. Later I found out that the biggest consumers of the products were the distributors themselves.This was the most embarrassing time of my business career as I retreated to more mundane activities to make a living, like physical work.
In order to make it in MLM you must use the people that trust you the most. The product has little merit on it’s own as it is often very over priced. It has to be to pay so many layers of profits. In our society, most business is done on the basis of trust. (More on this in a later blog.) The only way to sell the product is abuse friendships or to appeal to peoples greed of large profits for little work.
Christians are particularly suckers for this type of marketing scheme because of bad theology. God wants the good life for me and it couldn’t be His will that I should have to suffer to obtain it. Work is part of the curse. All things work together for good for those who love God (and money). Doesn’t God want me to prosper financially? I need the money for the ministry. (justification). I can do it part time and use it as a tool to reach others. (more justification.)
Luke 16:13-15. 13 No servant can serve two masters, for either he will hate the one and love the other, or he will be devoted to the one and despise the other. You cannot serve God and money.”
14 The Pharisees, who were lovers of money, heard all these things, and they ridiculed him.
15 And he said to them, “You are those who justify yourselves before men, but God knows your hearts. For what is exalted among men is an abomination in the sight of God.
1Tim.6:10. For the love of money is a root of all kinds of evils. It is through this craving that some have wandered away from the faith and pierced themselves with many pangs.
Most distribution is done either factory direct to the retailer or through a 2 step marketing system where the manufacturer sells to a distributor who in turn sells to their dealer network. The more people that take a cut along the way, the more expensive the product is to the consumer. It stands to reason that if you want to build a business, get as close to the manufactor as possible, otherwise the goods become over priced.
You are not building your business as they claim but their business. They own your client list. If you leave, all your downstream is lost to the company.
In reality, you are not selling a product, you are selling a concept. An unworkable concept that statistically, only the guys at the top make money. The rest of the drones are left to mislead people into believing in the dream (lie.)
There are many reasons why MLM is not a good business model but my main objection is that you need to deceive people in order to be successful at it.