Why are so many people skeptical about Home Based Businesses?

[JulieAP0304]

Well most people immediately associate home based business opportunities with multi level marketing scams, high pressure sales, harassing your family and friends and cult like behavior.  So I thought I would take a moment to discuss some terminology that many of you have probably heard.  I have found however that most people are actually unfamiliar with the meaning behind the terminology.  I hope this helps a little!

 

Pyramid Scheme:  This is a business model that is non sustainable.  It requires the enrollment of others (and exchange of money for the enrollment) into the scheme without any product or service.  Pyramid schemes are illegal in the United States.  However, there are many businesses that operate in the “gray” area so it is wise to proceed with caution.

 Some identifying factors of a pyramid scheme are a “hyped” up sales pitch, little or no information about the company unless someone spends the money on products or to become a participant and no products or ones that are sold at excessively high prices. 

Multi  Level Marketing-MLM (aka Network Marketing):      This is a business model whereby a parent multi level marketing company  markets their products by means of relationship referral and direct selling.  In other words, there is typically no advertising involved in the marketing of the products, rather, independent salespeople (which are referred to as independent consultants, agents, business owners etc) try to establish their own sales team (organization) and each business owners markets the products to friends, family, strangers etc and are awarded commissions based on the volume of product sold.

 

There are many components to Multi Level Marketing Companies, including breakaways, binary plans, matrix plans, matrix schemes etc.  Some of these components are not appealing and proper research should be conducted.  Be sure you ask the questions and completely understand the terminology before proceeding with the company.

 

In most legitimate MLM companies, commissions are earned based on the sales of the company’s products or services.

 Direct Sales:  This business model involves marketing goods and services through various vehicles such as presentations and demonstrations.  Direct sales are utilized when goods and/or service require additional explanation. 

Many prominent people began their careers in direct selling.

 

It is perfectly acceptable to be skeptical but not ok to generalize and assume that all home based businesses are scams.  Do your research and make an informed decision.  Just be sure you cautiously proceed and do the research without being sold on the get rich quick concept.  Then, you just may find what you have been looking for!

 www.freewebs.com/dreamsintoreality

[qtmomof2]

Apr. 21, 2008 at 7:11 PM I don't know why people are skeptical ...I guess because everything seems like a scam and/or you have to put money into something. I'd love to work from home ...just don't know what is legit and what isnt :)

[parrothead]

Apr. 21, 2008 at 8:56 PM Great journal post! It's so true, I have met so many moms that are "afraid" of being scammed that they don't do anything.  As long as we offer as much information as possible, they will see the benefits and truth about working from home with a legitimate company with such an amazing track record!  I always tell people how proud I am of being partnered with the company I work with.  I did an mlm that I was not proud of for three months...and what a difference! It wasn't a "scam" per se, but just not the quality that I was lucky to find in my current business!!!