It’s a Pyramid Scheme!

 scheme alertI’m writing this blog today after being inspired by a young family member who had visited my new Facebook page for my new business, coming back to me and saying ‘you know it’s a pyramid scheme right?’

Well, I’m writing this for him and for many others like him who only have limited knowledge about the difference between a ‘Pyramid Scheme’ and a legitimate Network Marketing or MLM business.

I have done research  to come up with a balanced collection of articles on both topics. And I hope that after checking them out and reading them thoroughly yourself, that you will be better educated, enlightened and also a little impressed with how hard Network Marketers have to work – every day – in order to build a profitable and sustainable business.

A Pyramid Scheme, by definition is a non-sustainable business model that involves promising participants payment or services, primarily for enrolling other people into the scheme, rather than supplying any real investment or sale of products or services to the public.

imagesLast time I checked, I am not involved in a Pyramid Scheme. From what I have read (many articles whose links you will find at the bottom of this article) A Pyramid Scheme does not require hard work. You don’t have to do any training, attend meetings, purchase product at wholesale to sell retail to a decent sized customer base – which again takes hard work AND it appears that if you are in a Pyramid Scheme, only money and ‘info products’ or similar exchange hands – if anything at all except money.

Now, my young friend in all his wisdom stated that a pyramid scheme was where you get paid commission for somebody else selling something who signed up underneath you – I’m sure he’ll correct me if I have incorrectly quoted apart from a little paraphrasing.

Well, I’ve had many ‘jobs’ where this scenario has played out – NOT my own businesses but employers I have worked hard for.

Owner – director – state manager – area manager – me

I did the hard work. I had buckleys hope of ever being able to make director of this firm, let alone owner – the buck stopped with him. So you can see where my young friend’s definition was perhaps not quite what he meant to say.

Please click on any of the blue hyperlinks above for more information on pyramid schemes.

Now, on the other hand, we have MLM and Network Marketing – set up by organisations who have a consumable product that they want to mass market. Rather than paying for advertising, they set up and rely on ‘word of mouth’ marketing – consumers of the product telling others about the products. As a reward for this, the consumers can opt to become distributors of the product and earn commission AND volume sales bonuses along the way – paid by the organisation that sells the products wholesale to the consumer/distributor. As an added bonus – an incentive to move more product into the marketplace into the homes of more consumers, amplifying the sales volume – a distributor is paid additional commission, a small percentage of any distributor that he personally introduces to the main company. And so on and so on.

There is no one person at the top. imagesCA02YKLF  a distributor can choose to introduce as many other distributors as he wishes. There is no limit. Then when those he has directly introduced, also introduce others who become distributors, another small bonus is passed up the line to the person who referred the first person in the team. It doesn’t stop at 2 or 3 and so on. A Network marketer shares a business concept. Not a get rich scheme.


Robert Kiyosaki Quotes

“For people choosing to use a network marketing system to build a business in the B quadrant, the price of entry is a lot lower, the risks are lower, and the education and support are there to guide you through this personal development process.” — Robert Kiyosaki, Entrepreneur, Businessman and Author

“If you are a person with big dreams and would love to support others in achieving their big dreams, then the network marketing business is definitely a business for you. You can start your business part-time at first and then as your business grows, you can help other people start their part-time business. This is a value worth having – a business and people who help others make their dreams come true.” — Robert Kiyosaki, Entrepreneur, Businessman and Author

Be sure to visit me on Facebook – I’d love to support you in achieving your big dreams. Want to be part of the Better Womens Network with me? Be sure to click here, fill out your details – its FREE to join!



 Keep Smiling!



Hi, My name is Sonia and I have had many titles and roles to date, being the mother of four awesome children who are now all grown up I'm 'Mum'. I've worked for retail giants, Real Estate Agents, Authors and Editors, I've been an advertising co ordinator, a receptionist, a manager, a travelling sales rep, a telemarketer, a spruiker, a karaoke host and an employment consultant. I am passionate about people and am now an entrepreneur with a vision to help as many people as I possibly can realise their dreams through engaging them and showing them tools that work! I'm still a mum. I still go out and do a few hours work for an employer that I love and I'm also still hosting karaoke shows - yes, I can sing a little too. I also own two fantastic businesses that I run from the comfort of wherever I can get internet access. If you'd like to know more, please contact me via facebook

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  • Luba Kanch

    Great blog Soni!
    A great explanation on the differences – this is a blog that sure would benefit most people on the net! Thanks for sharing-I am bookmarking this one!

  • Beautifully done, Sonia! If I had had any doubt about what a pyramid scheme or an MLM is, your post would have cleared it up for me. Thanks!