What is MLM

This is me in Feb. 2013When people hear or see the words MLM or Network Marketing, they think it’s a pyramid scheme and the people behind it are just out there to take their money and run.

Although there are “schemes” out there and it is important to recognize them so you don’t get taken. The MLM model is a solid, legitimate way to make money as well as save money with special tax deductions you do not have with anything else. This special way to make money is open to anyone, but success does depend on people doing the work necessary to generate income. There is training on this in many MLM companies.

Take a look….

The reason many people are attracted to an MLM is because the cost to get in is low, and the earning potential can be very good.

MLM ( Multilevel Marketing) and NWM (Network Marketing) are both used to describe a unique form of business, a Home Based Business, where there is a special relationship between an MLM Company which supplies products/services along with commissions and bonuses, and an independent distributor who markets and advertizes these products and services.

It is a low cost, alternate way to make money from a business, where you don’t have all the headaches and high costs of a regular brick and mortar or franchise, but still have all the income potential and benefits of a business. MLM actually makes it possible for anyone to have this special opportunity, and it doesn’t have to be a full time commitment..it can be a part time venture.

There are simple MLM companies available that make this unique opportunity accessible to the masses.

In fact, Financial Experts advise:
everyone to get a home based business for the tax deductions

MLM is a unique way of distributing goods and services that allows independent distributors to establish their own home business and be responsible for their participation within the MLM company. You are your own Boss, and you can decide who you want to have as business partners in your venture…ie. who you want to work with. You are also in a unique position to help others make money and save on taxes.

Like any business, there is a cost to set up, and monthly expenses, including products/services from the MLM company.

The business model involves ” sponsoring or recruiting” other independent distributors as well as customer retail sales. There is a “Big Lie” that has been sweeping the networking industry for some time now that entices people to get involved with a program, and it goes like this:
~DO Nothing,
~Make a Ton of Money.
This never works and to me is a sign of a true “scheme” to avoid. It also hurts the industry by having people falsely believe that the money they so desperately want and need could come this easily.

When distributors take their MLM home business seriously, learn what they need to know about the products and income plans in their chosen MLM and decide on how they are going to let the world know they are in this business, and do what they need to do to “work” thier business..that is what creates an income.

To be qualified to receive commissions, distributors are usually required to purchase the products/services supplied by the MLM. These sales become part of the commissions and bonuses paid to distributors.

Each MLM is unique in what they offer, so it is important to thoroughly investigate the MLM business before getting involved. You can be involved in more than 1 MLM at anytime, creating multiple streams of income.

This is an interview of Robert Kiyosaki with Oprah
were he shares his money secrets…having a Home based business is one of them


Well known author and businessman Robert Kiyosaki commented that traditional corporations have the pyramid scheme structure with the CEO on top and everyone else below. MLM is the opposite because it works in a way that anyone within the structure can rise to the top.
Source: Success Magazine April/May 2008

Other well known successful business people support the MLM business model including Donald Trump, and billionaire Warren Buffet, who also owns MLM’s.

A true pyramid scheme can be recognized when there is no product or service. The MLM company also needs to have a means for contacting them, and be forth rite on who the owners are.


There are special tax deductions which only apply to Home Based Business, and being in a MLM qualifies for these deductions…eg business use of home.
For more information:CLICK HERE

Aside from the obvious tax breaks, being in an MLM allows you to work from home. This can give people who must stay close to home a way to make extra income. This includes stay at home Mom’s/Dad’s and people with illnesses or situations that make it difficult to work outside of the home. Marketing and advertizing can be done many ways and anywhere including calling on the phone and sending info via the internet.


Answer: Anyone, but success depends on a personal ability to:
~plan and follow through
~being highly motivated is as asset
~a take charge/let’s do it attitude helps
~ being passionate about what you are doing
~believe you can do it

Real success involves “networking” or talking with people, so being sociable is an asset.


~ work when you choose
~ no commute time
~ some MLM’s are Global so you can do business in most countries
~ low start up cost compared with a traditional business
~ support and training available
~ excellent income potential
~ with the “leverage” of the distributor system, not trading time for money
like in traditional jobs
~ possible unlimited income potential


MLM is an alternative means to make money, save on taxes and is a legitimate low cost way to have a business…a Home Based Business. There is a cost to get set up and the good ones require a monthly purchase of products/services to qualify to remain in business. MLM involves marketing and advertizing to find future distributors and customers, and there are many different ways of doing this including “word of mouth” ,social media marketing, offline marketing, and internet marketing. MLM is a good way to diversify ones financial portfolio, and can easily be added into ones existing schedule. Success comes by focusing on others and helping them achieve their goals.

If you are still a skeptic…how about taking a look at how the US IRS tax system
defines MLM….


Multi-level marketing. Certain companies sell products through a multi-level marketing arrangement, such that an upper-tier distributor, who has sponsored a lower-tier distributor, is entitled to a payment from the company based on certain activities of that lower-tier distributor. Generally, depending on the facts, payments from such multi-level marketing companies to independent (non-employee) distributors (upper-tier distributors) that are based on the sales or purchases of persons whom they have sponsored (lower-tier distributors) constitute income for the performance of personal services in recruiting, training, and supporting the lower-tier distributors. The source of such income is generally based on where the services of the upper-tier distributor are performed, and may, depending on the facts, be considered multi-year compensation, with the source of income determined over the period to which such compensation is attributable.

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