How does MLM work?

Under the MLM model, distributors are not employees of the company. Instead, they’re individual business owners who recruit their own distributor networks to help them sell products. Multi-level marketing firms rely upon this extended network of independent distributors to generate revenue. To understand how MLM works, think of a pyramid.

What are some examples of MLM business models?

This type of business model is also referred to as a direct-sales model. Other examples of MLM businesses include Tupperware, Rodan + Fields, Natura & Co., Vorwerk, Nu Skin, and PM-International, among many others. Multilevel marketing is a legitimate approach to sales, but it does share some characteristics with illegal pyramid schemes.

How much money do MLM sellers make?

Based on the results of a 2018 poll conducted with 1,049 MLM sellers, the majority (60%) earned an average of less than $100 in sales over a five-year period, and 20% never made a single sale. The majority of sellers made less than 70 cents per hour.