Global Survey Into Multi-Level Marketing
By Peter J Daniels

Text Copyright © 1992 World Centre for Entrepreneurial Studies Foundation

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EDUCATIONAL BOOKS

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HOW TO BE HAPPY THOUGH RICH ©1984 World Centre for Entrepreneurial Studies Foundation

HOW TO REACH YOUR LIFE GOALS © 1985 World Centre for Entrepreneurial Studies Foundation

HOW TO BE MOTIVATED ALL THE TIME © 1985 World Centre for Entrepreneurial Studies Foundation

HOW TO HANDLE A MAJOR CRISIS © 1987 World Centre for Entrepreneurial Studies Foundation

HOW TO HAVE THE AWESOME POWER OF PUBLIC SPEAKING © 1988 World Centre for Entrepreneurial Studies Foundation

MISS PHILLIPS, YOU WERE WRONG…a formula to handle rejection. © 1989 World Centre for Entrepreneurial Studies Foundation

GLOBAL SURVEY INTO MULTI LEVEL MARKETING © 1992 World Centre for Entrepreneurial Studies Foundation

HOW TO CREATE YOUR OWN DYNAMIC MISSION STATEMENT THAT WORKS © 1994 World Centre for Entrepreneurial Studies Foundation

LIVING ON THE EDGE (autobiography of Peter J Daniels) © 2003 World Centre for Entrepreneurial Studies Foundation

A CHRISTIAN CODE OF CONDUCT – the missing link © 2009 World Centre for Entrepreneurial Studies Foundation

WILLPOWER – the integrity of the soul. © 2010 World Centre for Entrepreneurial Studies Foundation

EDUCATIONAL PROGRAMS

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PETER J DANIELS

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DESTINY OF THE THIRD MILLENNIUM (major tutorial program with diploma) © 1989 World Centre for Entrepreneurial Studies Foundation

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GRAHAM K DANIELS

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THE WAY I SEE IT… “a world view on fortune, family and future” © 2006 Graham Daniels

NEW CHALLENGES IN THE 21ST CENTURY

Peter J Daniels guest speaker at a large Multi-Level Marketing Conference

SURVEY INTO NETWORKING/MULTILEVEL MARKETING

This survey is dedicated to the dreams of all those multi-level marketing people, and to the companies which need to help make their dreams a reality, in the fervent hope that ‘a change for the better’ will be the watchword for the future success of this dynamic force.

We hope that this survey will give those committed people out in the field the message they so desperately want, and the multi-level marketing companies the message they so desperately need.

PROFILE

WORLD CENTRE FOR ENTREPRENERUIAL STUDIES

The World Centre for Entrepreneurial Studies is a well established high performance organisation seeking to anticipate the corporate, government and individual requirements in the 21st century.

The World Centre for Entrepreneurial Studies has been involved in assisting many organisations, businesses, governments and institutions throughout the world since its inception in 1984.

It has succeeded in becoming truly global, with international clients and students, and has become a world leader in industry traditionally dominated by organisations established decades earlier.

All of this has been achieved without loans, over drafts or outside capital injection, at a time of immense change and severe economic problems that are prevalent in many parts of the word.

There can be no reason for our success other than that we get results.

The uniqueness of this organisation is demonstrated by its aggressive approach to providing information and education relevant to the challenge and the location of the need in many countries.

Because of the tradition, debt and fixed locations, normal universities and business schools find it increasingly difficult to meet the stringent demands of the every-changing world markets and economies.

Not bound by any of these restraints, and equipped with international reports, and grass-roots sensitivity, the World Centre for Entrepreneurial Studies responds to organisations and governments by travelling to areas of need anywhere in the world. Working within the client’s time frame, it presents the information or challenge required with outstanding success.

Exclusive corporate, staff and individual strategic planning, tutorials and surveys are arranged to obtain a competitive advantage which can help predict new trends. Seminars and conferences, including either selected tutorial presentations or complete conference agenda and management, can be provided to give an ‘effective results boost’ to any industry Confidential advice and guidance can provide reassurance and direction, allowing decisions to be made with new and different insights and information.

The World Centre for Entrepreneurial Studies has conducted over one thousand seminars to some of the largest audiences in the world, and their small group workshops provide a ‘hands on’ tutorial of world class standard. Both have proven to be exceptionally effective.

All tutorial programs, books videos and manuals are exclusive; they are soundly researched and performance-based covering such subjects as Long Term Strategic Planning, Economics and Morality, International Intelligence, Goal Setting, Crisis Management, Motivation, Marketing, Public Speaking, Time Management, Sales, Financial Independence, Success Attitudes and How to Develop You Own Personal Destiny, and are readily available throughout the world, in several languages.

The World Centre for Entrepreneurial Studies has become a world leader in the field of entrepreneurship for one reason – it gets results.

PREFACE

When one hears the words Multi-level Marketing, Network Marketing, Direct Selling, Word of Mouth Marketing, Pyramid Scheme, Passive Income, Affiliate Marketing, Referral Marketing, ‘Home-based Business Franchising’, a Uni-level Plan, a Stair-step Breakaway Plan, Matrix, Binary, Hybrid plan, or Party Plan, in general terms they immediately identify with the same or similar activity, and to the uninitiated it is all the same........ ‘it’s that pyramid scam thing again ‘.

MLM organisations have been described by some as cults, pyramid schemes or organisations rife with misleading, deceptive, and unethical behaviour such as price fixing, misleading information in respect to where some of the real money is earned in the industry, exaggerated income clams, the questionable use of evangelical discourse to promote the business, and the exploitation of personal relationships for financial gain. Additionally, with an overemphasis of encouraging recruits to further recruit others as a priority to the success of the business, there is no wonder why some people say at best MLM’s are nothing more than legalised pyramid schemes.

There are some multi-level marketing organisations that offer greater incentives for recruitment than product sales. This practice of getting commissions from recruiting new members is considered to be ‘pyramiding’ in many jurisdictions, and so we have to ask the question, are such claims and perceptions justified?

Today Multi-level marking operates in one form or another in over 100 countries around the world, and although there have been many scams, rip-offs and frauds, it is the authors view that the basic concept in its pure form can be very good for many reasons, non the least for its potential to exert extreme leverage in time and effort. In effect this leverage was highlighted by Archimedes, the Greek mathematician born in 287BC. It was he who stated: ‘Give me a lever long enough, and a fulcrum strong enough, and single-handed I can move the world. ‘

By utilising the practice of many people doing the work of one, an astute multi-level marketer is able to leverage time and energy, thus multiplying profitability. This formula is uniquely simple in application within the MLM model.

Additionally the concept of personal referral as a means of propagating a concept, product or service is not new. It is in fact a natural means of disseminating information with continuity that dates back at least to the time of Christ where the Apostle Paul stated ‘........ the instructions which you have heard from me along with many witnesses, transmit and entrust to reliable and faithful men who will be competent and qualified to teach others also. ‘

In reality this is the very basis of the MLM plan, and highlights the importance of a training system to ensure sustainability to the growth and extension of life to any MLM business.

A study of the modern history of this MLM concept will reveal that commercial multi-level marketing foundations were laid in the late 1800’s. One of the first was the California Perfume Company, based out of New York by David McConnell, which by 1906 had 10,000 sales representatives selling 117 different products and in 1939 changed its name to Avon Products Inc.

Carl Rehnborg in 1934 started the California Vitamin Corporation selling what today are known as vitamin supplements. In 1939 the company changed its name to Nutrilite Products Company Inc.

Alfred C. Fuller in 1906 started the Fuller Brush Company and hired 270 dealers throughout the U.S. to follow his business plan on commission only.

In 1931 Frank Stanley Beveridge (the former vice president of sales for Fuller Brush Company) and Catherine L. O’Brien founded Stanley Home Products. Influenced by the economic hardships of the Great Depression, Frank and Catherine identified and created an opportunity for ordinary people to start their own business with minimal investment, selling products that people used everyday. Stanley Home Products sold household cleaners, brushes, and mops. Some Stanley dealers began giving demonstrations to clubs and organisations rather than individuals to increase sales volume. Other Stanley dealers quickly embraced this idea as a way to maximise the selling presentation. These dealers took the ‘clubs and organisations’ concept into homes, by having the home owner invite friends and family over ........ and the ‘party plan’ was born.

Stanley Home Products is often accredited as being the training ground for many well-known MLM company leaders such as Mary Kay Ash, founder of Mary Kay Cosmetics and Brownie Wise of Tupperware.

Many of these and other MLM’s that were to follow offered an opportunity of integrity for an individual to earn a living and better their lifestyle by marketing sound products on commission. This industry offered entry into a vocation without formal education qualifications, which presented an opportunity of starting a business with little or no capital outlay, the flexibility to work at ones own pace, the liberty to choose ones own working hours, the invitation to be trained in people skills and product knowledge at no cost, the realisation of the dream to travel the world as a business expense, the comfort of knowing it is possible to leave a viable business as a heritage to the next generation, and THEN to allow others to enjoy and duplicate the same business opportunity. It all seemed too good to be true......but it was true ....until the system became corrupted by the unscrupulous.

MLM is not for everyone. In fact if you do the calculations you soon discover that it can’t be. If you consider one person as the first MLM recruit, recruiting only two others, who in turn only recruit two others, and continue that scenario to its conclusion, you would exhaust the entire population of the planet in just 27 ‘levels’.

However the reality is that this has never happened in the century of MLM existence, because it is simply not for everyone, but it is a business opportunity for more than some, and in its pure form it can be nothing short of fabulous as many will testify.

But before racing out to sign up in the hope you are to be counted among the success stories, there are two questions that need to be answered before any MLM can get to first base.

1. Is the product or service offered, value for money?

2. Would I be an advocate for the product or service if there were no MLM plan attached to the selling of this product or service?

We believe, there are some simple tests to be applied by an individual who is seriously considering a future in MLM and these tests are dealt with in this publication by way of chapter ‘headings’.

It is hard to believe, but up until now, there has not existed a simple test or international registry, to determine if the company who is seeking recruits is one of integrity, honour and promise. The difficulty this has caused for new recruits is that any corporate claims to fame have been subjective and self-gratifying by those who are involved and it is therefore tainted with bias.

Due to the authors open and unbiased endorsement of this industry in its pure form, we are often contacted by those individuals who have read previous publications of this book, seeking advice as to which MLM company we would recommend they join. On many occasions we have offered such possibilities, however it soon became clear that a measurable and transparent system was required. What evolved was a ‘quality control’ register of MLM companies that have undergone scrutiny and have achieved the ‘PILLARS OF EXCELLENCE AWARD’ as a MLM business of integrity. This Registry determines that a particular MLM is one we would encourage the ‘would be recruit’ to include on their short list of companies to be considered. We do not recommend MLM companies that are not on this list. (For more details and to view the ‘PILLARS OF EXCELLENCE MLM COMPANIES refer to the rear of this publication)

This survey is an in-depth study of one of the most lucrative and fastest growing businesses in the world today – multi-level marketing, sometimes referred to as networking.

This survey is not a witch-hunt. We have deliberately avoided identification of multi-level marketing companies.

The Preface to this survey poses three questions:

1. Why is multi-level marketing growing so fast?

2. What are its long-term prospects?

3. Why has this phenomenon not happened before?

1. WHY IS MULTI-LEVEL MARKETING GROWING SO FAST?

Quite simply, the networking/multi-level marketing fulfils a need on two levels.

A) It promises individuals the hope of starting a business without large set-up costs or debts and then surrounds those individuals with an atmosphere of encouragement that is not available elsewhere.

B) It produces individuals who are economically successful and who flaunt the trappings of success unashamedly; at the same time it often promotes a commitment to family life.

2. WHAT ARE ITS LONG-TERM PROSPECTS?

To measure its long-term prospects, one must look to the past. Instances of this type of marketing have existed, in some form or another, for at least fifty years.

The reason this method of marketing is making a strong impact is because of its commitment to its customers and downlines. It adopts, in a sense, the welcome ‘corner store’ mentality that once provided personal service. The commitment of that old corner store created a relationship and similar to that of an extended family member.

Department stores and other merchandising organisations cannot understand this multi-billion dollar business because they are looking in the wrong direction and have quite a different modus operandi. They look at products, locations, advertising, graphs, finance and strategies. Those involved in networking/multi-level marketing concentrate on individual people and their dreams and aspirations. This is the fundamental difference between the two.

The long-term prospects of networking/multi-level marketing can be measured only against the company’s long-term plans, their existing long-range contracts, training, research and development, which looks ahead in this the 21st century.

The other aspect, of course, is the willingness to consider ideas that may not fit into past and present operations.

Networking/multi-level marketing companies and indeed the whole industry’s future, or lack of it, can be summed up in five words: people, contracts, training, products, ideas.

The wild card, of course, is government legislative intervention as the result of lack of forward planning, and industry own self-governance.

3. WHY HAS THIS PHENOMENON NOT HAPPENED BEFORE?

Networking/multi-level marketing has been around for a long time, but it certainly has not been moving at the current accelerated pace. There are several very good reasons for this:

A) New competition between networking/multi-level marketing groups compel them to be more innovative and to create strategies that open more doors.

Competition will often bring out the best in companies and individuals, but sometimes, unfortunately, it also tends to brings out the worst.

B) Economics have changed and will continue to change. The lack of opportunity to do that which provides security for a family, in a lifestyle that is acceptable, now causes some to look at their future in networking/multi-level marketing as an alternative to the threat of unemployment and uncertainty of tenure in whatever well-paid present employment they may have. The facts speaks for itself because.

C) This is the first time in the history of economics that an ordinary person, without the humiliation of going to a bank or relative to borrow money, (and thereby going into debt, maybe for many years) can enter a business arrangement debt-free, with an opportunity to become a millionaire. It’s just never happened before in the history of economics! The revelation of the method, not surprisingly, induces many to join the parade.

Let us say, at the outset, that the World Centre for Entrepreneurial Studies supports and endorses networking/multi-level marketing in its pure form, because it can provide an opportunity for people who want to earn a substantial income.

But as we have stated before it is not for everybody. Just as being a fireman or a politician requires a particular type of commitment relative to that craft, so this requires a particular type of commitment. For those who are energetic and who like to be with people and have challenging desires, MLM can provide an immense opportunity that will absorb their lives in the direction and capacity toward their choice. They will find this survey of immense help in deciding and managing their network multilevel marketing involvement.

For those already committed to a networking/multi-level marketing organisation, this survey may reveal to you some changes that need to be made.

The keen, scrupulous networking/multi-level marketing company has nothing to fear and everything to gain from this survey, because it will enable the company to observe its own weaknesses, and to create new and exciting programs to fulfil its needs, that will help to increase its share of this dynamic expanding business, at a crucial time in our economic history when many people are seeking a new opportunity and a different way of life.

Why did the World Centre for Entrepreneurial Studies conduct this survey?

As strategic planners and speakers at seminars we have been invited to speak extensively at networking/multi-level marketing companies at all levels, throughout the world.

Our telephone, email, fax machine and mail box has been full of enquiries seeking advice, help and assurance in respect to networking/multi-level marketing involvement. At times we were in discussions and debate until the early hours of the morning with groups and individuals who, in many cases, did not understand the contracts they had signed or the basic principles of business law regarding their craft.

Also, many disturbing comments, fears and documents that have been shared with us by concerned networking/multi-level marketers, have put us in the unique position of receiving ‘unsolicited confidence’, which would not be available within normal survey parameters.

What we have been told describes a business world which is reminiscent of a confused army in the midst of a battle, with everyone wanting to be a leader but no one knowing the way to victory.

The networking/multi-level marketing confusion has no company or country boundaries and is universal. For instance, ask any networking/multilevel marketing individual, ‘Who owns the business?’ and they will emphatically respond that they do. Then ask them, ‘Who owns it above or below your position in sponsorship?’ and they will start to grope for words. Ask any networking/multi-level marketing person, ‘Who has the best program?’ and they will immediately respond, ‘We do’. Then ask them to explain their program against two or more competitive programs and you will find that they know little about their competitors’ programs. Ask any networking/multi-level marketing sponsor, ‘Is your business long-term?’ and they will respond emphatically, ‘Yes’. Then ask them to give you a brochure or to explain their career or long-term training program and you will find that they rarely have one.

It is because of this confusion and the many contradictions that we felt that some clarification must be brought. So we launched our three year investigation and survey.

Networking/multi-level marketing is too dynamic a force to be misused by ill-informed, and in some cases, unscrupulous people and organisations, as its expanding influences affect individuals and families throughout the world.

Networking/multi-level marketing must also come to grips with the responsibilities that come with the control and involvement of masses of people. Most people tend to believe what they are told – they should feel free and confident to do just that!

The authors hold the view that this is an industry that is worth rescuing, and this book was published with that objective in mind.

How this survey was conducted.

Most surveys consist of a set of questions peppered with veiled duplications to obtain some insight into the thinking of a particular group, organisation or individual, that will show a pattern or direction in their thinking, movements and aspirations which would enable a formula to be created to direct a market, manufacturing or management strategy.

The difficulty is that in such a questionnaire, whether in writing or conducted by personal interview, it is impossible to pick up nuances, or deep and often hidden doubts or conflicts, and in some discussions we have to sit through long-winded responses in order to discover key thoughts which will lead to further questions.

This survey was not done in the normal formal fashion. It had form, but the form meant discussions in homes, in offices, at airports, behind the stages of conventions, over meals, in aeroplanes, in automobiles and on long journeys. It even went on during banquets, at hotels and holiday resorts. Most of it was volunteered rather than solicited, because as we sought to assist people in sorting out some of their problems, then information would flow in, to the point where we received, by email, post and facsimile, unsolicited documents, agreements, including letters from the hearts of organisations, and from those who felt that there were things happening that were not right. They thought that if we knew about them we might be in a position to help.

The survey was never allowed to be out of our minds because at times double the information we sought came back and it poured in, at times like a avalanche – people were eagerly seeking reassurance on specific points. There were times, to our embarrassment, we were receiving information we neither sought nor wanted.

This survey had to be done in a most informal way if it were to be accurate and successful in discovering the truth. We covered most of the large networking/multi-level marketing companies in the world and a good number of the smaller and aspiring ones in many countries, relating to many different products.

Another valuable response to our survey came from students of our books, CD’s, DVD’s and programs who at their own cost, continually sent unsolicited letters and information to our office regarding their own involvement in networking/multi-level marketing as a ‘Thank You’ for the help our material had been to them.

What this survey reveals.

The most important revelation of this survey is that it proves that the networking/multi-level marketing confusion is widespread and deep-seated, and that what is often said by the promoters does not always relate to what is finally done in practice, although sometimes it takes a long time to uncover the subterfuge surrounding some of the claims.

This confusion concerning what networking/multilevel marketing is and what it offers tends to bewilder honest, unsuspecting and desperate people who want to do something with their lives. They really do want to believe what they are being told, but their reasoned thinking becomes clouded in respect to their hopes and by networkers’/multi-level marketers’ contagious enthusiasm. So the cycle begins.

This survey will also show that there are some principles which divide the doubtful and the desirable, and will also provide guidelines for those wishing to improve their business.

THE MOST AMAZING THING THIS SURVEY REVEALS IS THAT, DESPITE ALL THE HYPE, MISINFORMATION, LACK OF COHESION AND MISUNDERSTANDING, NETWORKING/MULTI-LEVEL MARKETING CAN OFFER INCREDIBLE OPPORTUNITIES.

At the conclusion of this survey, our assessment was that the future of networking/multi-level marketing, if it is cleaned up, is bigger and brighter than any extravagant earlier assessments indicated, and that it will create a massive market shift in this the 21st century.

Survey results:

1. Very few networking/multi-level marketing companies had long-term career track or training programs.

Many networkers/multi-level marketers will tell glowing stories of the future prospects that will be yours if you follow their system.

They assure you that graduation to an upline pin guarantees more money and more opportunity to develop your leadership skills

But if you are serious about succeeding in the world of networking/multi-level marketing, then you would expect that there would be some type of long-term, in-depth career training program to help you develop the ultimate necessary skills through tutorials, workshops and sophisticated methodology to give you some reassurance.

The serious way in which McDonald Hamburgers, with their ‘University of Hamburgerology’, tackled their craft to ensure solid, well-trained, career people was rarely to be found in our survey of networking/multi-level marketing companies. Yet, the potential financial rewards could be as large as those of any international fast-food franchise company.

As a matter of fact, other than repetitive, shallow short-term training by upline personnel and some cursory company attempts by those not acquainted with the needs in the field, there was very little to be found. It would appear that the confidence of long-term tenure was rarely evident in most of the networking/multi-level marketing companies we encountered, which raises the question, ‘Are they really expecting to be around in ten or twenty years time?’

It could be argued that long-term career-track training was never needed before and the business of networking/multi-level marketing does not require in-depth long-term training now.

But the world is changing rapidly and the facts paint an entirely different picture because what we see as a gigantic fall-out rate, sloppy and misleading presentations and extravagant and unsubstantiated claims, and some networking/multi-level marketing companies boast that the massive fall-out rate is part of the business, rather than accepting it as a dangerous economic and public relation problem that needs to be addressed.

In every individual counselling session or group meeting we had, we heard the desperate cry from the people in the field for in-depth, long-term career training.

Many families who are involved in networking/multi-level marketing want to have some assurance that the years that they put into the business will provide for their children the option of following after them. But the drop-outs continue, because somewhere along the hard climb to the top of the networking/multi-level marketing pin levels, they realise that the company has made very little preparation for permanence.

Somewhere sometime out there in the networking/multi-level marketing world, a company with vision and a real commitment to permanence will finally produce a serious career track training program that will induce young people to take it up as a preferred profession. When that happens, their business will explode and the transfer of people from other networking/multi-level marketing companies will be the reward.

2. 95% of networking/multi-level marketing companies have no start-to-finish work manual.

In the early stages of our survey, whilst conducting meetings in the United States for a very large networking/multi-level marketing organisation, we were surprised to be approached by a young man who had been in the business for about a year, who wanted to speak to us privately. We arranged a time to meet. He produced a rather serious attempt to put into written form a work manual that he could use in training those people he had sponsored.

Knowing something of the size and the financial standing of the organisation he represented, we enquired as to whether the company had something already available, based on research and experience, to supplement or even supercede his attempt to create some type of work manual, only to be told that his upline had been asking for something to be done in this area for many years and nothing had been forthcoming.

Over the term of this survey, it was to be part of our aim to find a company which produced start-to-finish work manuals on networking/multi-level marketing, confirming to the newcomer the expected income at the various pin levels - how to demonstrate the products - how to show the business plan, and how to grow, control, and teach others, together with measurable, credible assessment methods to show that the information had been learned and understood.

We have heard from some networking/multi-level marketing field people who wondered why they had been struggling so long to reach a particular pin level, only to find out they had been deliberately suppressed by their uplines so that they would not have to share the financial spoils obtained from the sales of books, CD, DVD and tickets to conferences.

A start-to-finish work manual would declare at the outset the rules of the game and prevent manipulation and cheating by unscrupulous and greedy players.

To be fair, some attempts were made to produce reliable information but, at best, they were inadequate and sketchy, and there were grave errors of omission in their presentations. If there is one available that we have missed, send it to us. If it is good, we will endeavour to give it, and the company the credit it deserves.

3. Few people sponsored were given the full marketing plan and/or provable income figures.

In networking/multi-level marketing, generalities abound with respect to the progress and the incomes of upper pin levels. Usually beginners are asked for their dream, desires and ambitions and then a picture is painted of how networking/multilevel marketing can be the means to attain these.

A whiteboard or paper is produced to show the multiplication effect of leverage, where one person becomes active and encourages others to do the same.

In a very short time it is obvious that the theoretical results are explosive. The theory is correct and in most cases, the plans on paper have been worked out with some accuracy; but in practice it is a very different story.

For instance – ask for the specific and proven time frames required to reach each level and the only reply will be – ‘Some do it more quickly than others; some take a longer period to reach each level’. Other answers will be, ‘It depends upon the individuals and the amount of effort he/she puts into it’ or, ‘It’s hard to tell because everyone is different’.

Yet, wouldn’t you think that the marketing and economic analysis experts of a multi-million dollar company would have some average figures that they can make available as a guide for beginners?

On the matter of income, one would ask a similar question with respect to averaging. The answer is simply this: although the organisations do have the information available, they are reluctant to disclose it because it may not be a selling point! Another question that remains unanswered is why they don’t show the full marketing plan, including extras such as books, CD, DVD and conventions that in some cases provide money spin-offs for a selected few.

The fact remains that business generated from some MLM network marketing companies from side deals by way of books, CD, DVD and commissions, and hand-backs from services recommended, is closeted in secrecy because, it may constitute secret commissions and/or involve other breaches of trust. The honourable operator, of course, has nothing to hide. We would suggest that if you contemplating or already in networking/multi-level marketing, ask the questions but do not accept answers unless they are substantiated by the principals.

4. Most networking/multi-level marketing companies do not use or even consider outside training experts.

Networking/multi-level marketing operations are basically a closed shop and the fear of outsiders is almost paranoid. Most progressive companies in other fields use outside experts in economics, planning or specific needs to update and inform. But in the world of networking/multi-level marketing, the suggestion of anything more than entertainment and inspiration at conferences will be met with a firmly closed door. This of course limits growth and confidence.

Some other areas of need are personal, family and business economics, logic and interpersonal relationships, selling and deep psychological understanding, goal setting and business management. At present these are all addressed by the uplines who eventually work so closely with their downlines’ personal problems and possibilities that they are unable to make unbiased decisions because it can affect the uplines’ income.

A factual example.........Situation A

The downline was strongly influenced to come to a weekend convention because he was told it would change his life and put him on the road to financial success. Because he had no money to go, he was advised by the upline to sell his television to obtain the necessary funds.

Another instance........Situation B

A family was considering getting some expert outside training to help long-term towards their professional future. The necessary money had been saved over a period of time. The upline convinced these people that the training was a waste of money and that they would be better of spending the money to buy one of the organisation’s vacuum cleaners at about the same cost.

In both cases and in many more, the upline was in a position to receive a financial benefit; that should have disqualified him/her from the role of personal counsellor.

In a fast-changing world it seems obvious that no organisation, whether tertiary, commercial or government, can afford to insulate itself from exposing its hierarchy and staff to new information, technology and training. But each must make its own choice.

We often witnessed that outside information, even from experts in their field, generated immense fear and opposition because of the frivolous attitude and inadequate skills of some upline counsellors.

Our office receives phone calls from networking/multi-level marketing individuals who have been ill-advised by counsellors/uplines. We know something of the complaints received directly by the companies. If changes are not made voluntarily, massive law suits could force them to put their houses in order and create some reasonable disciplines.

5. All networkers/multi-level marketers are incestuous and breed and feed on each other’s experience, which tends to multiply clichés and perpetuate faults more than it accentuates strengths.

Clichés reign supreme in many networking/multilevel marketing groups. This is seen on stage at conventions, in meetings at homes, in discussion groups and at conferences. Clichés are not bad if they have substance, but, unfortunately, in networking/multi-level, marketing, often substance is what is missing.

One lecture we gave on the science of goal-setting received such a response from the recipients that it became embarrassing, to the point that a group of the networking/multi-level marketing downlines came to us privately and asked us to speak to their principals to convince them to give us more time in the convention to elaborate further on this needy topic.

Unfortunately, the higher pin levels squashed the idea because they felt unable to compete in the area of training and, quite rightly, perceived a shift in respect and loyalty away from themselves towards a more experienced and knowledgeable presenter who was internationally qualified and immediately earned the respect of the downlines.

With in-breeding of any kind, both strengths and weaknesses surface; but it is amazing how the weaknesses tend to come to the top, like cream rising on heated milk. It requires seemingly less energy to gravitate to a weakness than to expand a strength.

All businesses must be mindful of defects and replace those defects with strengths to prevent the weaknesses from destroying the whole. It is very much like the old adage, ‘Tell a lie often enough and it will be believed’. In networking/multi-level marketing, meaningless clichés are actually faults that give the appearance of motion; but in fact the machine is revving more than it is progressing.

6. Few networking/multi-level marketing companies (or ‘leaders’) have come to grips with uncontrollable egos that repulse the very people they are trying to attract, and cause much division from within the organisation.

The lifestyle of many networkers/multi-level marketers in the high pin levels oozes extravagance, loudness short attention spans and arrogance.

This comes from being stroked so many times by the upline and the company, together with the expected edification from the downline, that after a while they become a law unto themselves, and their world is the only world they see, and the only world that they want to live in – a world surrounded by glorification, glamour, and ‘yes men’.

It becomes very hard for them to be able to step out into the real world and, in some cases, they don’t want to recognise its existence.

This, of course, is repulsive to the outsider; but it also creates havoc within the system. All of the egos push against one another, competing for attention, and trying to outdo others by having the biggest and best and most expensive of everything, even if it means having to go into massive debt. Some of those surveyed recognised the problem and tried, with very little success, to moderate their behaviour with rules and agreements, but no one had come to grips with a simple ethics formula with penalties which could bring to heel this outrages behaviour.

Networking/multi-level marketing organisations recognise the need for a strong ego. There would be few that would dispute that. But a strong ego must not be out of control, because it repulses the very people it is trying to reach.

Our survey showed that friends and relatives of networking/multi-level marketing people were embarrassed by much of their behaviour, because it tends to put others down rather than lift them up, and creates a public relations nightmare.

7. All talk about leadership, but few have even the remotest idea of leadership skills and principles.

Leadership in networking/multi-level marketing is something of an enigma, in so much as those who are charged with the responsibility of leading others sometimes fall into that category by default or accident. For example, if you are sponsored into a networking/multi-level marketing group and you are fortunate enough to sponsor some real go-getters yourself, then you are forced up the ladder by those underneath you, rather than being the one leading.

It is a strange kind of ‘leadership’ which thrusts the untrained and immature into all types of situations where they are not able to perform adequately, and their down-lines become their guinea pigs.

Some have created leadership courses, but after even the most cursory glance at their notes or five minutes into their presentations, one wonders about the results of such fuzzy material.

The question that needs to be asked is this – ’After fifty yeas of networking/multi-level marketing in some form, why have the associations charged with the responsibility of representation of these groups not created some kind of leadership manual that could be universally used or adopted as a guide to better business? ‘

If you feel we have been unfair or that we have slanted our survey by investigating the rogue networking/multi-level marketing groups, then write to us with your specific, measurable results-orientated manual. We would be delighted to hear from you and may be able to give some support and assistance in its use.

8. None have addressed or even shown any concern for the huge fall-out rate.

Some networking/multi-level marketing groups even suggest a figure as high as a 98% fall-out rate.

One organisation has gone through somewhere around 500,000 sponsorships in a twenty-year period, and after all that effort, has still only been able to produce something less than 20 ‘diamonds’, which is around the half-way mark for pin level!

The disturbing fact is that these enormous fall-out figures are accepted as a normal part of networking/multi-level marketing strategy. But because of the system of sponsorship and the magnitude of the army it produces, the casualties seem to be of no interest to those who should be responsible for them. The proof of this is that nobody has seriously challenged the credibility of the system.

The awful truth really comes out in humour. It is commonly joked about like this: ‘Hold a mirror up to the prospect’s face – if it clouds up then get him/her to sign on the dotted line. ‘

What really has been overlooked is the long-term damage such attitudes do to the industry and the immediate and continued work load it creates for all concerned. Let’s deal with them separately.

A) The long-term damage that a fall-out rate produces.

In a world concerned with energy conservation, it seems ludicrous to ignore the waste in human energy involved in signing up hundreds of thousands of people who from experience you know will eventually fall by the wayside. It builds up massive public resentment against the networkers/multi-level marketers, which will eventually express itself in pressure from governments to legislate with Draconian Laws which will seriously compromise or even obliterate the business, thereby closing unnecessarily a field of enterprise that is basically sound in principle, but bad in implementation.

B) The wasted work that is done.

The large fall-out rate produces a repetitive workload that is never ending. Sponsoring people, knowing that the majority discontinue, means you have to sponsor more and more to get a sufficient number to grow. This cannot be considered good business practice. In the normal ebb and flow of any industry it would not be tolerated.

We would like to make a suggestion that might provide some good homework for the reader.

1. Find out from the Bureau of Census and Statistics in the country in which you live, what percentage of the population is in the top income bracket.

2. Find out how many persons have been sponsored by your networking/multi-level marketing group, or the one that you intend to join. How many are still involved now, and how many are in the same top income bracket?

3. Compare the above and note the difference.

We would suggest that if you compare those sponsored in networking/multi-level marketing and those out in the normal work force, the rate of failure (i.e. those under the top income bracket) in networking/multi-level marketing would be higher, which leads to only one conclusion – if you want to have a better chance of being in the high income bracket group, then stay away from networking/multi-level marketing.

The other side of the coin, of course, is that there are those who do stay on and succeed, in some measure. If you accept those numbers and take that percentage, then the outcome is somewhat different. However, at the moment, approximately 98% of those participating in this business are unsuccessful. We would have thought that a figure as large as that ought to get someone’s attention.

What this survey is achieving is provoking the participants and proprietors to think, so as not to destroy this great industry by default.

Sincerely, we would like to warn that, sooner or later, if this issue is not addressed, it will invite a class action suit that could be the largest civil legal case in the history of law. It may even reach the executives, who knew all along that the system was geared for failure.

Should a class action be commenced, it could wipe out one of the greatest marketing programs that has ever been designed in the history of economics.

9. Many of those sponsored in networking/multi-level marketing came from a bad financial situation and almost nothing is done to prevent a return to that situation.

The reason that networking/multi-level marketing appeals to those who are thread-bare or on the financial ropes is that it offers hope and recognition.

It offers an opportunity for independence that is not available elsewhere, especially in uncertain economic times which we can expect in the many years ahead as more people throughout the world are made redundant by failing economies at a time when more people tend to look for hope, because hope is often the only thing that is left.

For the networking/multi-level marketing groups, hope shines brightly, beckoning to wrecked lives and offering safety amidst the economic storm. Our survey, far from being totally negative, suggests that networking/multi-level marketing can be an opportunity for many walks of life and for all ages. The changes that will take place in the industry because of this publication, and the involvement of many clever up-market executives from other industries who have been made redundant, will create a new vista of opportunities that has not been available before.

For example, it has been reported by Neil Offen, Present of the Direct Selling Association of U.S.A., that in corporate North America in 1975, for every middle management or executive position there were seven candidates. That is, one person got the job, six didn’t. In 1985, for every middle management or executive position there were twenty candidates. This meant that one person got the position and nineteen didn’t.

It was estimated in the mid nineties for every middle management or executive position available in North America, there were between forty and sixty applicants, and today it may even be worse, so what employment is open to these executives? We believe that networking/multi-level marketing could attract a large percentage of them.

The sadness of the present situation in networking/multi-level marketing is that it is somewhat like the blind leading the blind. Each one is telling the other that they are going to make it, but the evidence is either very slow in coming or deep down there is a failure to recognise the basic fundamental flaws in a system that can promise hope. Such should give encouragement and recognition, but often fails to deliver, in decent terms the financial reward that is relative to the energy given.

If networking/multi-level marketing persons were to assess their time at its true value, most would fail miserably to come up with an adequate financial return. The basic fact remains that they do get other rewards such as hope, encouragement and recognition, but these cannot be dished up for Saturday night’s dinner or provide comfort in old age. Knowing the need that engenders such hopes, it would appear that a built-in preventative plan in the early stages to assist in learning the principles of financial recovery and in the removal of emotional and other scars, and a plan to prevent re-occurrence, would receive top marks in the area of compassion and concern.

In a recent addition to our survey, we had permission to ask some high pin personnel what they saw to be the biggest need in networking/multi-level marketing. To our surprise, it wasn’t money or more products; it was what they called ‘proper training’. So we say to the proprietors and executives of all networking/multi-level marketing companies, do your own survey, ask your own questions and go into the thread-bare homes that support you and look into the eyes of hope; you will come to a similar conclusion.

10. All talk of helping others, but in only a couple of groups did we find a permanent expanding benevolent fund to help the community. There was almost no real practical emphasis on charitable help to the networker.

In every case, sponsors of networking/multi-level marketing said that they were in the people-helping business, and almost without exception, they subscribed to some religious affiliation which had its roots deeply imbedded in the philosophies and theologies of mercy, compassion and giving. In spite of that, the real empathy towards others was, if anything, it was left to individuals, and in the terms of cold hard cash, it rarely happened.

In some desperate circumstances, where uplines and companies were unwilling to help, we provided our own funds to assist in situations of genuine hardship.

Networking/multi-level marketing companies may say, by way of defence, that there is no commercial return for works of benevolence. We would go so far as to say that the networking/multi-level marketing soul is bared by its pronounced theme, ‘Go for the greedy, not for the needy’. One day this will come to haunt them in the form of competitors who have arisen because of the absence of care. Sponsoring sporting groups is not the answer either, although it is good for public relations.)

There does need to be deeper, more honest, care for those who work in the networking/multi-level marketing business, and for new and long-term recruits who receive little or no reward for their considerable time input and yet provide the backbone of the business. It’s time that management looked at ways to meet the needs of the field people, so that what is preached can really be believed.

A slogan that would assist in addressing that problem could be a fixture on every office door and labelled on every networking/multi-level marketing product: ‘We care and we prove it’.

The day of the church reaching out to the needy has all but gone and its replacement in many countries, the welfare economy, is gasping for breath under its heavy load. Today it may be left to the industries with heart and soul to do the unthinkable in economics, and that is to give a little. After all is said and one, there is, in this case, much, much more said than done.

11. 70% of networkers/multi-level marketing marketers have very bad manners and a lack of people skills outside of their own group.

Most networking/multi-level marketing people are told to edify blindly their upline and, in many cases, they are taken under the wing of someone else who shows them how to do it. The respect that is shown to high achievers is almost akin to hero worship and the attendance to their every need is like having an unpaid servant at hand ready to do your bidding.

Once they step out of that direct environment, the difference is quite alarming and a distaste for obvious courtesies, such as thank-you notes for special attention and the other verbal niceties that come with being polite, are usually ignored.

One example which stands out to us occurred in a foreign country. Some networkers/multi-level marketers knew that we would be in town, and asked if we could speak at a seminar for them from 10:30am until 3:30pm, at no cost to them. Because we had no other commitment that day, we agreed to help. We had an exciting morning and when lunch time was announced, the hall cleared quickly because of the limited time available to eat.

We were left in a strange empty hall, in a strange city, not knowing where we could get something to eat and with not even a phone to call a taxi. It was obvious that our ‘host’ had forgotten that the foreign guests might like to eat also. We include this experience because it is more the rule than the exception.

Manners such as standing up when a woman enters the room, not interrupting conversation, not talking during lectures, table manners and business etiquette need attention if the high pins and others want to be accepted as professionals.

Of course there are the rare exceptions who literally overflow with the milk of human kindness, and they will remain forever in our memories.

12. In most cases, few returned phone calls, emails, facsimiles or kept commitments with any consistency.

High on the list of disappointments with networking/multi-level marketing involvement is that after the initial sponsoring contact, anything requiring discipline cannot be relied upon.

During the revision of this survey, I was phoned from a foreign country by a networker/multi-level marketer asking how he could contact one of his associates with an urgent message. He had phone, faxed, left messages and sent emails, but to no avail.

Of course, the signal that is being sent by those who cannot be contacted is that unless a call is of a direct and immediate financial benefit to the recipient, they do not want to hear from you.

We also found that meetings usually started late and would run overtime and it was common to never expect a clear, concise agenda for any meetings!

It is obvious what has created all this, of course, it is the consistent fall-out of personnel, which breeds a dissatisfaction and an expectancy of compromise that permeates the whole system, unfortunately it even finds its way into the paid staff, who tend to ball-park their activity rather than bulls-eye it.

It also expresses itself in a reluctance to return calls. The lack of substance creates an atmosphere of rush, rush, rush, and the whirlwind of activities creates a climate of preoccupation, giving an illusion of growth and importance.

At first glance we were misled, as we saw that many of those involved in networking/multi-level marketing had at least one home phone plus a cell phone, a fax machine and mail system which indicated quick communication. However, these remained unanswered and at times they were not even switched on, even when the owners were at home. One networker/multi-level marketer had four mobile phones, including a portable car fax, in addition to one in the office and at home. That did not include the business bank of seven phones in his house plus a 24 hour recording service and a full-time secretary to answer the phone and do other work; the secretary admitted that she had great difficulty in getting her boss to respond to calls with any consistency.

Emails can be almost useless. We can recall only two or three that were answered without repeated requests in the three years we did the survey. A facsimile used for the purpose of speedy and accelerated communication may need to be sent several times over a six month period to get a response! We were informed on one occasion that the fax machine had been out of paper for days or even weeks.

Message machines are full of great upbeat comments, saying how important your phone call is, but again it’s just words. Excuses abound for lateness and failures to keep appointments, and sometimes contacts are forgotten altogether.

The networking/multi-level marketing company that can get it right will have a field day compared with all competitors.

13. All talk the business up, but few work the business down.

As we came out of a seminar with a life assurance group, a man recognised us in the foyer of the hotel from a book we had written. After introducing himself, he proceeded to share the rewards offered by the networking/multi-level marketing company he had joined and the additional wealth he knew we could obtain if we followed his advice and put ourselves under his direction. We were courteous but declined, and as he was about to leave, he handed us his card with his name and phone number and the caption ‘Millionaire Maker’. We called him back and after some considerable vacillation, he admitted that he was always broke and could, within the next month or so, go into personal bankruptcy. On further questioning, he admitted that the system was good but he did not work at it very much.

The networking/multi-level marketing business is full of people who catch the concept and pass it on to others like a disease, rather than a cure for their lives. The position is clear and it is this:

Networking/multi-level marketing is too easy to get into and requires no provisional assessment to sort out the vacillators. While it continues in this direction, the lazy opportunists will unfortunately gravitate towards it, swelling its ranks and cluttering up the works.

Those really serious people who work at the business of networking/multi-level marketing, do so with gusto. I doubt whether I have never met a more hard-working group of individuals; the load of stragglers that they are forced to carry under the present system is unfair and it is always justified on the basis of hype, uncertainty and ‘they never know how that person is going to perform’, which creates the myth and the momentum.

After all these years, you would think that, like insurance companies and other industries, they would prepare a profile of what makes a good networker/multi-level marketer, validated by the companies and organisations concerned.

The more realistic approach could be a period of assessment which allows an evaluation to be made. The decision to continue in the business could be made against some kind of criteria which would result in a more balanced industry and truly dedicated personnel.

14. None financially rewarded the beginners all rewarded the high pins – but the difference between companies’ incomes and similar levels was staggering.

We can’t throw out the baby with the bath water and say that the total fall-out rate was caused mainly from the inability to adapt or the unwillingness to put the work and time into the plan. It goes far deeper than that. Inadequate training and initial assessment are high on the list.

The other cause of the massive fall-out rate was the unacceptability of low financial returns in the early stages. Many couples went into networking/multilevel marketing with stars in their eyes and worked extremely hard an intelligently. In the end they looked back on years of work and large chunks of time away from the family in return for a financial pittance.

The reward system is a little back to front. The more successful you financially become, the greater are the financial rewards that come to you. Although this is used an incentive to cast your lot into the ring, the beginners really are the basis of support for the successes because they are also the customers. On that basis, at least, economics ought to get the attention of the management and say, in effect, ‘Give a better reward to the beginners to encourage them to stay and grow’.

Our organisation has suggested this to some principals only to be met with the disapproval of the upline and management who claim that you sell the dream in the early stages, and make them wait for the rewards. The simple truth of reward for measurable effort does fit into the plan but the proportions seem to be somewhat out of focus.

The other area of contradiction is the difference between networking/multi-level marketing companies, with some rewarding their high-pins with millions of dollars a year, and others who seem to cut out at about $50,000. The graduating scale down from there is similarly imbalanced.

Some, of course, major on recruiting and balance their financial return on that basis, which leaves the initial recruiter in a position to retire or enjoy other pursuits if the right people are recruited.

15. Most cheated on tax or manipulated facts to show a more exaggerated income.

The more we see conventions with ticket sales, books and other material sold at the door etc., the more we see in reality the manipulation of funds and the secreting of money away from taxation authorities. We doubt whether anyone is seriously overjoyed by the tax systems of our particular countries. But it is the law, and cash transactions are subject to laws which must be obeyed. We expect to see, within the next few years, major prosecutions for tax evasion in the networking/multi-level marketing industry.

If you doubt this statement, ask a successful networking/multi-level marketing person what their spendable income is and then ask them to show you their tax return to substantiate that claim, if one in a hundred balanced, we would be surprised.

Debt pays a big part in the world of networking/multi-level marketing, allowing a display of wealth over and above the reality of receipts. The system, on that basis, has its workers firmly under control because they rely on the monthly cheque to pay the mortgage. A three month moratorium on cheques from the company would see most high pin networking/multi-level marketing participants begging at the financial wall, and a disclosure of exact income levels would send shock waves through the industry.

16. All said that they had the best plan but none were sufficiently knowledgeable of other organisations to compare.

In a survey of hundreds of networking/multi-level marketing participants, only those who had transferred from other networking/multi-level marketing groups had any idea of competitive groups’ plans.

Without exception, irrespective of countries, we found no full or part time networkers/multi-level marketers who had any real idea of how their competitors operated; yet in each case they were absolutely convinced that their plan was the best. The only exception to this was those who had been in, and fallen out of, a previous M.L.M.

Innuendo and misleading information about competitive groups abound from all networking/multi-level marketing participants, and in some cases the stories and conflicting information within a group of five people from the same company was nothing short of incredible, and it appears to point to fear and ignorance of the unknown.

The other interesting point was that, even in discussion within an organisation, the disagreements as to how their own plan was supposed to work became something of a sad joke.

The bottom line was that very few knew anything about the plans or processes of competitive companies and the networking/multi-level marketing companies, again without exception, did nothing to show comparisons and didn’t really seem very interested.

Could it be that comparisons would also show their own weaknesses? Again or survey was clear in its conclusion based on the following response from networkers/multi-level marketers, ‘You do not talk about weaknesses in your system and you avoid acknowledging them’.

17. Most had problems between paid staff and those out in the field – it became ‘us’ and ‘them’ situation with executive staff creating rules and continually changing those rules to emphasise their power and control.

In almost every networking/multi-level marketing organisation there is a war between the salaried staff and those out in the field. That war is waged in every system, even though we were assured that it did not occur in some groups. The evidence was there, sometimes obvious, but most times subtle. The reason for the so-called war is a lack of understanding from both sides as to what the other’s role is; but the most dominant issue is money and control.

Networking/multi-level marketing field people are a special type. They live and breathe a personal dream and a work ethic that is not fully understood emotionally by those who are charged with the responsibility of management. A field person expects everything to have been done yesterday but may delay several days, or even weeks, in responding to requests from Head Office for added information.

Field people have no starting or stopping times, no public holidays, guaranteed annual holidays, or long service leave. Their employment has no retainer or wage guaranteed or any of the securities that formal employment offers. The interesting thing is that they don’t want them.

They are a different breed who are prepared to risk and pit their energies and abilities against all-comers, but they expect in return a bigger prize at the end of the race. Field people are prepared to ignore onlookers and are willing to jump hurdles. When we compare them with the normal staff person on a salary with all of the above work conditions, all within a structure that usually has some type of gradual progression towards a higher paying position, we find that the gap is extremely wide.

The inside staff are tyring to keep this explosive outside army on course, but sometimes it is like tyring to control a run-away semi trailer. So they add more and more controls, to the point where the field people feel unduly restrained and react accordingly.

In the beginning, the new recruit grows. Things tend to run smoothly until the personal aggression that is required to succeed develops. That then provokes questions concerning control, which seems to kick-start the reactor on both sides. When the field person starts earning a far greater income than the staff person, subtle resentment creeps in and is expressed by the rules being bent or changed at every opportunity.

All this can be resolved if groups are brought together by a company charter in the form of a mission statement relating to the office men and women, the executive, those in the field, the truck drivers and all concerned.

18. None had any training program in public speaking but continued to boast of skills without testing them against outside groups to obtain factual and unpadded feedback.

If you are a networker/multi-level marketer whose business is expanding, opportunity for sharing your success with others will put you before more live audiences in twelve months than most people experience in a lifetime.

As an example a bus driver we will call ‘Jim’ came down from the platform after addressing a lively group of eighteen hundred people with the crowd still applauding and cheering. I asked Jim ‘When would you, as a bus driver, get an opportunity, outside of networking/multi-level marketing, to speak to eighteen hundred people?’ and he responded, ‘Never in my lifetime’.

There is no doubt about it, networking/multi-level marketing offers opportunities in public speaking that cannot be duplicated elsewhere, and the audience is so excited and encouraging there is nothing that compares. The problem is that the speaker loses consciousness of his or her time and euphoria takes over, affecting both the audience and the speaker. This is expressed in cheering, even when things ought to be quiet, because of a sad comment. Blatant mistakes are obvious to the outside observer while the public speaker remains ignorant.

The speakers are never properly trained and phrases like ‘you know’, ‘anyhow’, ‘I mean’, with the usual clichés and slogans of the particular group are added as garnish, to the point that if you’ve heard one, you’ve heard them all.

The shock comes when they speak away from a sympathetic ‘family’ crowd; then the surprise of rebuttal and silence wipes them out! The reason that we raise this here is that incestuous and repetitive, puffed-up behaviour alienates the networking/multilevel marketing people from the real world and makes the whole industry suspect and thereby tarnishing an image that needs to be restored to a place of pride and respect in the market place.

Networking/multi-level marketing companies must come to grips with the fact that all their people are their ambassadors and that the more attention that is paid to professionalism, the more the public will see them as professionals.

19. Products of a similar kind could be obtained outside the networking group.

Let’s face it, networking/multi-level marketing is a simple marketing formula used to move products more successfully than conventional marketing formulas.

It’s a good method of marketing a consumable product because of repeats, and the field people are usually the best customers. Hence, more and different high unit-value repeat long-term products are being used on this track, because it works on a specific captive market principle, since the purchasers are anxious to progress to a higher pin and will buy a product as an example to others in the group. They are called 100% users.

I have yet to see a networking/multi-level marketing product that is not available or easily producible in a similar form or type outside of the networking/multi-level marketing group. As a matter of fact, some are brand name lines with a different label on them to suit the networking/multi-level marketing organisation, and in some situations produce their own products. There are others that suggest that they are the manufacturers, when, in fact they are not. This is a common form of misleading propaganda and is used in many supermarket stores as well.

The other issue is that the cost of some networking/multi-level marketing products seems to be outrageously expensive compared with those available in stores, while others maintain a sensible competitive edge. The mark-up percentage on products for networking/multi-level marketing groups in general terms is not excessive when you compare the number of intermediaries from the manufacturer to the retailer with other products. The difference is that the networking/multi-level marketing groups divide the money usually paid to all the intermediaries in normal business among their pin levels. But, as a general rule, most products that networking/multi-level marketing companies are selling can be obtained elsewhere at a similar price and are of similar quality. The edge that networking/multi-level marketing has is the relationships that they build with their customers.

20. We found no evidence of any group having either a practical, measurable, mission statement or a published ethics journal.

Earlier we made mention of the tensions, between paid staff and field workers and suggested a charter or mission statement to help resolve these conflicts. The reason we bring this up again is that conflict abounds within the corporation just as intensely as out in the field.

A mission statement can be used to bind people to a common cause in order to build and maintain a corporate culture. To do this, it should be valid to the despatch department as it is to the president or to those at each pin level. It must be clear, measurable, realistic and understood. In effect, it tells everyone, including the customer, what the French call the ‘raison d’etre, the ‘reason for being’.

Once an organisation comes to grips with its mission statement, then an ethics journal can be created to conform to the mission statement. Its power will be in its clarity and disciplines. A mission statement that is high on emotion and low on description will create the same difficulties when it comes to ethics, and more time will be spent arguing over meanings and opinions than on clarifying conflicts.

Always remember that leaders are controlled by principles, whereas power holders and manages seeks to control by rules. Principles universally stand the test of time, whereas rules are changed constantly, often achieving little.

We have yet to see these points addressed. If you have something similar to what we are suggesting here, or something you feel is better, then please let us know and we will help to put it into the right hands.

21. Many networking/multi-level marketing companies offered bulk stock purchasing incentives, and some went very close to infringing laws against pyramid selling.

Over forty years ago pyramid selling burst onto the scene like a chain letter promising riches beyond our wildest dreams, some did get wealthy and a few fabulously rich, but the majority were left with enormous debts and garages and lounge rooms full of products that they could neither use nor sell. In some cases, the products became so useless that those who were left with them had to undertake the additional cost of having them taken away and dumped. The law stepped in and passed legislation, almost universally, to prevent this from recurring again.

But even after all these years the stench still lingers. The thought of those millions of dollars to be made tempts others to cross the line or go very close to it.

We expect over the next few years some major prosecutions of networking/multi-level marketing companies who are using clandestine methods and pressure to get their field people to carry excessive stock. It could be in the form of incentive offers or training and establishment contracts; but beware of the seductive inducement to growth as it may be beyond the bounds of practicality and the law.

We suspect that the ‘pyramiding of time’ commitments may be the next infringement. Companies will compel their people by inducements to put in large amounts of unproductive time; this could require legislation to protect against greed.

This is a warning to encourage you to compare your system as it is written and taught with what is practised. We suggest that somewhere you put in a mechanism that tells you if anyone is stepping over the mark deliberately or inadvertently. Even undue emphasis on getting extra supplies because of holidays or impending shortages may invite investigation; any suggestion of buying up to a higher pin and encouraging others to do the same is asking for trouble.

22. Many had book, CD & DVD programs with no real consistency or pattern, and the participation was either compulsory or encouraged by subtle pressure.

Now we come back to the lack of a long-term training program again. Let us say quite emphatically that the book program is often contingent on how cheaply the books can be obtained to provide bigger profits, rather than on its value as a programmed training system.

The content of the CD’s that become part of the regular program are by speakers within the system, who often receive royalties on each CD, and upper pin levels, who also receive a small percentage of the CD profits, as they do with book sales.

Any suggestion of a serious attempt at educating the lower pin levels by this method has to be questioned. Everyone is encouraged to participate because it produces more income for those handling the program.

In their defence, I have to say that on many occasions we noticed books of exceptional standard, by well-known and respected quality authors, which would be of undoubted help to people in most walks of life.

What we are objecting to and what we are pointing out is that the books are not generally part of a planned strategy but are simply convenient revenue-makers. Books are purchased to meet deadlines and to produce revenue and not necessarily for their content.

Generally speaking, if you do not participate in the book and CD programs, you will lose the attention of your upline and feel somewhat alienated, being seen as someone who doesn’t understand the importance of such a program and destined to mediocrity or ostracisation due to lack of ‘commitment’. The easiest way to find out whether the program is real is to ask a question that is never asked, such as, ‘Could you show me the subjects you intend to cover over the next twelve months in your book and CD program?’ Ask them to be specific. If they have a real program, it won’t be a problem to them and they will produce the schedule, usually on the spot.

23. All participants in network groups look to sponsor a champion, rather than being one themselves, and rely too much on the luck of the draw.

The top person in any field rarely has, at first, the appearance of a champion. Our experience tells us that champions and geniuses may come from any walk of life, and at their full and final development may even surprise those that are closest to them. But there are some fundamental requirements. For example, a person who is only five foot tall will rarely make a champion basketball player. Like wise a person who does not genuinely like people will rarely make a good networker/multi-level marketer.

We are not saying that certain strengths cannot be learnt, because that would fly in the face of overwhelming evidence to the contrary. What we are saying is that there must be either a desperate need to make the change or a willingness on behalf of the participant to endure the pain to make the change a reality.

For example, we came across a shy country farmer who, under the threat of foreclosure by the banks, exploded into a human dynamo. Other people in the same circumstances may not have responded positively at all. In spite of this, the survey showed quite clearly that there needs to be some kind of defined assessment or qualifying period that guides a sponsor. Again, we came back to the organisations themselves and asked the question, ‘Why haven’t you created a networking/multi-level marketing profile?’ We reject such statements as ‘You can never tell what a person is capable of’, as a true but superficial explanation for so many failures.

A large number of networkers/multi-level marketers are still looking for someone who will break down the barriers and create a high pin level in record time and thereby provide a big financial return for them, the sponsors. In reality, this rarely happens. In most networking/multi-level marketing organisations, it just doesn’t work.

There are those who depend on the luck of the draw and sponsor at random, but this will never provide the credibility networkers/multi-level marketers need, nor will it provide many with the big returns that they hope for. Networkers/multi-level marketers have a tough road ahead that involves long hours. Selectivity in your down line and involvement in a good organisation with quality products gives you the best chance.

24. None understood the basic fundamentals of principal and agent laws relating to their craft.

One of the most frightening aspects of our survey was the lack of knowledge networkers/multi-level marketers had of the laws relating to the business in the countries in which they operated and the way in which their principals (the networking/multi-level marketing companies) were oblivious, in some cases, to the obligations on the principal to be responsible for the people out in the field (their agents).

In basic terms it works this way. A networking/multi-level marketing company employs its marketers as agents who represent the company out in the field. Under that arrangement what the marketer says or does, in effect, binds the principal (the networker/multi-level marketing company). The principal may have recourse against the agent, but only under certain circumstances. It can get quite complicated when you are sponsoring people four or five deep and they, in turn, are sponsoring four or five deep and so on. The principal and agent laws can become complex in defining who is accountable and responsible. One point which seems to be reasonably clear is this: if principals are aware of what is happening out in the field that are wrong, or that they disapprove of, and they allow it to continue, then they have in a sense endorsed the actions and, for all intents and purposes, must accept responsibility for them.

Whilst what we have just said is a simplification, it points out quite clearly what is not well known. It may take some major court actions to bring some of this to the surface. In our attempts to rescue this industry, we had hoped that the principals concerned would pay more attention to these matters.

Another area of concern is that of secret commissions. In some countries, you cannot act as principal against principal, which means, in effect, if you are acting on behalf of one individual by concurrently representing another principal or group, then you must not benefit financially from that group using the first principal’s people or information for personal gain. There are other issues also in relation to secret commissions which in some countries are offences and carry a jail sentence.

We have given some grave warnings already to groups on this matter and we can only hope that those warnings are heeded.

25. Most networkers put emphasis on looking rich and neglect the principles of being permanently rich.

At numerous MLM conventions we were often confronted by the phrase ‘fake it till you make it!’

The high pins of networking/multi-level marketing are a glamorous group, bedecked with jewels and fine clothes, enjoying large homes, the latest model automobiles, overseas trips and a seemingly endless amount of money.

Our attitude is quite simply this – if they have earned it honestly, as in any field of endeavour, they deserve it and the way they spend it is their business.

The tired joke here is that in many cases it is a mirage – and the closer you look, the less real wealth they seem to have. Many high pin networkers/multi-level marketers with all the external trappings have voluntarily told us that if their commission or bonus cheques were delayed or withheld, even for a short time, then they would default their loan repayments very quickly and be in financial trouble.

The other twist in some networking/multi-level marketing groups is that only the high pin levels are permitted to wear gowns and tuxedos at functions, which tends to over-emphasise their income and elevate their position.

The company has its own way of using the monthly cheque, bonus or discretionary payments and this is one of its major disciplinary tools. If a networker/multi-level marketer does not conform to its expectations, then that company tends to find reasons to withhold certain payments and within forty-eight hours the offending networker/multi-level marketer is on his/her knees. Sometimes a threat is all that is needed to have the desired effect.

In contrast to control by holding or threatening to withhold funds, a great deal of effort is put into theatrical, glamour meetings where expensive motor vehicles, boats and other luxuries are on display, together with expensive fashion parades and videos of glamour spots around the world, to sharpen the wealth appetite.

Is there any wonder once you get hooked onto a high pin level, you can never get off? In some cases you have to say, ‘Who would want to anyway?’ But there does come a point in one’s life when integrity must prevail and an assessment must be made as to whether one’s life is being made subservient to ‘unusual’ principles.

26. To the outsider, networkers/multi-level marketers have about as much credibility as used car sales people and politicians.

In many parts of the world, large numbers of people have been approached by a networker/multi-level marketer asking if they would be interested in an exciting business opportunity to earn extra money. Alternatively, some friends or acquaintances, whom you have not heard from in years, call and want to invite you out or to their home. When the time arrives, you find it is a scam to get you involved in a networking/multi-level marketing group.

To their credit, many networking/multi-level marketing groups do sign up a huge number of peopled using these methods, but again, we must point out the fall-out rate and we want to proclaim loudly and clearly that the end results show that they don’t work effectively. Using scams or gimmicks to introduce people into a business has the suggestion that the business carries the same sort of credibility.

Our survey showed that the second greatest need, as determined by the networkers/multi-level marketers themselves, after ‘proper training’, was to correct their bad image. The two are bound intrinsically together and each relies on the other’s success.

The public is getting tired of being treated as brainless morons and it is in the worst possible taste and very bad manners to try and trick people into loaded commitments. It is refreshing to find out that the field people themselves are also becoming embarrassed by it.

It is time that company training personnel went out into the field to meet the problem head on, to face the embarrassment that the field workers encounter and to come up with some better method. It is past time to clean up the image of networking/multi-level marketing and it must come from the top down, summarised by one simple word, ‘Leadership’.

27. All successful networkers/multi-level marketers create a lifestyle that is controlled and dominated by their business.

Networking/multi-level marketing, with its multiplicity of meetings and commitments of sponsoring and travel, can insulate you from the outside world so that it seems that there is very little time left to do anything else. You will recall in the preface to this survey, we said that networking/multilevel marketing has a slight but positive twist, and that is a suggested commitment to ‘family life’. That commitment is talked about at functions and recommended as a prerequisite for success. Although it does bring the husband and wife together as a necessary team to work the business, and it may have helped some marriages, but sometimes the children become remote because they are so often with babysitters, nannies with the simple feeling of abandonment. The parents console each other by the agreed understanding that they sacrifice ‘family present for family future’. Although this is possible, it is not often forthcoming, due to the huge fall-out rate.

The recommendation of the promoters is to put a few hard years now so that you will be able to spend more time with your family later. However, a few years to a child can represent half a lifetime, and believe us, when the high pins’ money starts to roll in the merry-go-round does not stop; it often still continues, even faster.

I have seen couples almost asleep on their feet for weeks on end, with communication limited to business matters and the children relegated to sitters, all in the name of success that is supposed to have a commitment to the family.

Networkers/multi-level marketers need to be reminded that children are part of the family and while some separation may be necessary at times, no business is worth the final price of distancing your children.

Again, we must come back to the proprietors of networking/multi-level marketing companies and say to them you have one of the greatest marketing tools in economic history; please, on behalf of the families that work for and support you, stop and reassess your program; create a think-tank, streamline your business. No opportunity is so good as to justify abandoning the family. It is not good long-term business, anyway, because the children of today are the buyers and legislators of tomorrow and they will function with memories. It is possible to be successful in this area, and those few who have thought it through should be examples and role models for family success while striving for financial success.

Networking /multi-level marketing deserves more intelligent thought.

28. 99% of networking/multi-level marketing groups suggest a lifestyle that is remote or unobtainable by the average participant.

It’s just not honest to say to networkers/multi-level marketers that they need to sponsor everyone and anyone, promising a lifestyle of wealth, glamour and free time when the statistics say something quite different. To meet people in their homes, tell them that they can do networking/multi-level marketing and convince them to start with the promise of great wealth if they vigorously work the plan, is unfair, as the fulfilment of the promise is possible but highly improbable. The lifestyles that are portrayed are both real and unreal, in the sense that some have made it financially but most who look as if they have made it are hanging on by the skin of their teeth. It’s more illusory than real. One participant testified to us that when they went diamond they were totally broke and the only asset they had as the second-hand Jaguar motor vehicle – not paid for!

In any kind of business arrangement, some proof of income after expenses needs to be shown to validate value – it is called the bottom line – and it is the only expression of reality that will convince those seeking concrete evidence of a successful business. It seems that a simple and very convincing way to get large numbers of people to sign up, if the real income is substantial, would be to show photocopies of high pins’ government income tax assessments, so convincing all doubters. Some may resent this as an intrusion of privacy but we find that hard to accept considering the way they exhibit their homes, motor vehicles and accessories to all and sundry. Networking/multi-level marketing is definitely a people business and its business is being with people and showing others your success; so why not go the whole distance and show them the full picture before you are compelled to do it by law?

If you are told that some networker/multi-level marketer earns a particular income or has a particular life-style, ask for proof. The smart, honest, successful operator will be delighted to take you into confidence because you’re asking the right questions.

29. Most networking/multi-level marketing groups thrive on hype.

And so does sport and anything else that is tackled enthusiastically. Hype means excitement. Hype is a very good response to substance, when excitement is based on a tangible or intangible goal, product or expression it can provide the required energy to get the job done. Hype and enthusiasm certainly can carry you through the difficult times and reinvigorate the downcast spirit. But, without substance, it will eventually leave you flat and with a sense of betrayal.

Our survey showed quite clearly that in networking/multi-level marketing, hype and excitement is, at times, whipped up or orchestrated as a substitute for plans or facts. And that, we believe, is totally wrong.

Because field people of networking/multi-level marketing organisations are hopeful people, who want to achieve a personal dream and are prepared to pay a price for that achievement by way of sacrifice, they are sometimes in need of encouragement; and generally many respond quickly with the enthusiasm and the hype necessary to energise their plans.

Networking/multi-level marketing field people are opportunists. They are one of the most exciting groups of people that you could relate to. By and large they will look for the best in every situation or person, which makes them a very special breed yet they are susceptible to abuse by uplines.

30. In most cases the downline is expected to act robotically towards his/her upline, which negates reasoned thinking.

Now, of course, there are exceptions to this statement and some networking/multi-level marketing companies emphasise individuality. This section is for those groups who encourage and even demand that you should not do anything personal or corporate without first checking with your upline or sponsor.

Suddenly, as a sponsor, you are elevated to the point of responsibility over people’s lives and privy to all kinds of personal and intimate knowledge that can be used or abused at whim. It is not an exaggeration to say that many downlines act robotically towards their upline. The word of the upline can be taken as law and will cause them to break any other commitments they have made that do not fit into the sponsor’s plan for them.

We have witnessed some horrendous examples of absolute obedience to the point that it borders on the cultish and, with large groups, has the overtones of ‘Jonesville’.

One particular case comes to mind. A group of field people invited a salesman to speak to them about a particular product outside of their own product range. After the demonstration, a number purchased the product, which was to be delivered a few days later, with cheques and credit cards. The company, true to tis commitment, went about processing the orders and delivering the goods, only to receive a large amount of phone calls a few days later, as many of the field workers cancelled their orders, dishonouring cheques and refusing to pay for the goods on instruction from the upline, who told them that they weren’t allowed to have the goods. To a person they robotically obeyed, causing confusion and loss to the salesman and organisation. We could repeat that story with other examples.

Creating such a robotically responsive system, under the name of loyalty, does nothing to enhance the image of networking/multi-level marketing, and indeed may be the basis for legal damages challenges in the future.

Loyalty is like any other asset – if it’s not earned, it is neither real nor appreciated. It is open to abuse and neglect in inverse proportion to the price paid for it.

We come back to a fact that has been repeated to us many times during our survey: when anyone transfers a part of the responsibility for the decisionmaking process of his/her life to another person whether willingly or by coercion, he/she becomes very much weaker and becomes open to abuse.

31. In most cases, conventions and special meetings have more to do with generating income for the upline and the company than with beneficial long-term training and nurturing of its people.

Most networking/multi-level marketing conventions and rallies conducted within their own group have a basic three-fold purpose.

Information

Entertainment

Money-making

We will deal with each one separately, but before we do, let us give you an overview of the ‘people’ climate before the large meetings take place.

At every level and at every minor group meeting prior to major functions, there is a great emphasis on how important it is to be at the major events. Every barrier is removed in an effort to get people there. Sometimes, buses are hired to take people two and three thousand miles non-stop to ensure their attendance. The high pins are directed to wear special attire and the rest can dress-up (but not in evening gowns or tuxedos!). Much is said about the speakers and the entertainment and ticket sales are pushed vigorously. It becomes difficult to refuse and the peer pressure to attend becomes overwhelming because of upline demands.

In contrast, rarely does the networking/multi-level marketing company provide conventions free, except for special tours to reward the high pins and, more often than not, these are also money-making events.

31.1 Information

The speakers add very little to the information agenda because the CD/DVD program has already related the clichés a hundred times before. The participants will get to hear most of them again, whether they want to or not, on the CD of the week or month, sometime in the future.

Having attended somewhat more than one hundred of these conventions and rallies, we can say that the relevant and useful information given over a whole weekend, less the repetitions and slogans, could be given easily within one hour.

31.2 Entertainment

The entertainment is two-fold:

A) that which you create yourself with your group and

B) that which is provided formally.

A) There is no doubt that the networking/multilevel marketing field people are fun to be with and their up-beat attitude and fun-loving spirit can make for an exuberating experience. A great deal of entertainment is created through interaction with each other.

B) The formal part of the entertainment is usually excellent, with razzle-dazzle stage presentation and well-known high-priced entertainers. There should be nothing to complain about here, even though their time is limited.

31.3 Making money

Again, the downline contributes to the company or the upline because often hotel rooms, meals and facilities are ‘loaded’ to allow for profit. We have heard many, many times from some high pin personnel, ‘I don’t make any real money from marketing the company’s product, but I do make real income from books, CD and DVD’s and convention ticket sales’. At major conventions they usually do a roaring trade in all three.

On the other hand, let us say this: there may be a very fine line between profit and loss, and to put an extra charge on tickets to prevent a loss is not wrong. What we believe is wrong is to make out that a conference or meeting is put on only for the downlines’ benefit.

32. All networking/multi-level marketing groups need an individual guru with charisma and style, and without this, they cannot survive.

To try and operate a networking/multi-level marketing company along the lines of a normal private or public company is almost a guarantee for failure.

Networkers/multi-level marketers are different and cannot be treated the same way as normal corporate groups. To try and put them into the same category would be like trying to mix oil and water. All successful networking/multi-level marketing companies looked up to a hero or heroes of credibility and charisma. These gurus seemed to ooze confidence and posses both personal and stage presence that, in some cases, almost cast a spell over those to whom they were speaking.

In rare cases, networking/multi-level marketing companies might contract someone from outside the industry who had all the obvious qualifications to handle the task, but not the less obvious qualities of commitment to the people or enjoyed themselves a private life of integrity. These people engendered only limited success. Those at the top who either started the business or who serve as examples, have an enormous responsibility to the thousand under their care. It may be difficult, if not impossible, to buy the kind of long-term deep commitment that is required.

It is our view that large networking/multi-level marketing organisations that are successful, may consider going public. It is our confident prediction that if this takes place, it will be the end of the organisation, as its charismatic figurehead/leader will be replaced by an ever-changing board of directors answerable to share holders. It is also our prediction that some companies that we know of, which don’t have a charismatic leader, will not be around in two to three years unless they acquire a committed, dynamic figurehead.

33. The networking/multi-level marketing proprietors need to look away from the sales’ graph occasionally and asses their own vulnerability.

All board meetings I attend world-wide tend to have a mentality that overlooks the fact that it is people who maintain the bottom line. Usually, in business, we look at the sales graph to ensure that upward mobility reflects costs against income. The upward graph on sales indicates progress, and comparisons of previous years’ trends and market shares can be made. An upward sales graph in any networking/multi-level marketing office give a feeling of growth and security. This can be more illusion that fact, because networking/multi-level marketing field people are viewed by most companies as replaceable fodder. It becomes a matter of acceptance rather than concern.

That networking/multi-level marketing companies have ignored their Achilles’ heel is proved by the fall-out rate of field personnel. When a newspaper or television report reveals rorts in the system and companies balance on the brink of disaster they hire P.R. experts and lawyers to quieten down or explain away their problems.

We heard of one major company losing up to 50% of its people and another up to 80% in a very short time during a period of bad press. In contrast to those, we observed other networking/multi-level marketing companies who treated their field people well. They kept them informed and when a bad report did come, rather than abandoning the ship, the field people closed ranks and the fall-out was almost negligible.

The message here to all corporate people is to be very sensitive to the real bottom line, which is your field people, who go into the highways and byways and make your organisation what it is. Attention to your people power, as reflected in this survey, could be the crucial factor in the long-term life and success of your enterprise.

OUR PREDICTIONS FOR THE FUTURE

Network Brokerage:

The future is full of change and in some cases, there may be a separation between the networker/multi-level marketer and the supply company. Individual groups with large numbers of downlines will contract for their own products and use manufacturers’ goods from many and varied sources. The networker/multi-level marketer may become a broker, not unlike insurance brokerages, incorporating complementary and compatible products and services.

Networking/multi-level marketing organisations will have the power of numbers because of the market available to them. Manufacturers will come to them seeking an opportunity to market their products.

Bunch Marketing:

Networking/multi-level marketing groups, even though they are competitors, could join together to form a type of co-operative for purchasing goods at bigger discounts. Their final prices may even be quite different depending on market strategy, markups and incentives.

Caretaker Managers:

Most networking/multi-level marketing companies in the future will have caretaker manages who can step into the shoes of a high pin’s group and manage it for them during times of absence due to sickness, holidays or other needs. Such managers will be paid on a separate contract basis depending on the size and type of the group and the work involved.

Government Legislation:

There is no doubt in our minds that unless networking/multi-level marketing companies very quickly change some of their long-standing methods of operation, they will be subjected to more and more legislation that may eventually strangle the whole industry.

Display Showrooms:

The future networking/multi-level marketing companies will have a showroom in prominent locations displaying goods and services offered so that a sponsor can show a prospective networker/multi-level marketer the merchandise in a profession way.

Field reaction against waste:

Field workers are always concerned about the enormous fall-out rate of recruits. Reassurance from those in control that is part and parcel of the business no longer hold water. The field people realise that they are the unpaid workers wasting human effort often without adequate compensation.

Counsellors as an Inbuilt Service:

Most networking/multi-level marketing companies of the future will realise the true value of their field workers. Inducements from other active groups will force them to provide in-house counselling on marriage, finance and education.

Career Tracks:

Some networkers/multi-level marketers are now starting to talk about career track training programs in an effort to distance themselves from the bad image of networking/multi-level marketing. They are realising that every person representing them creates a public relations’ impression.

Capturing the Young:

Any organisation is only as good in the long-term as the new blood it attracts in every generation. Progressive networking/multi-level marketing companies will start to get involved in schools, colleges and universities, by sponsoring events, donating equipment and explaining the economics of their particular brands of networking/multi-level marketing in an effort to capture the young and so reach their parents.

The Age Wave:

In most western countries the aging population has escaped the networking/multi-level marketing phenomenon. There is a great scope for a program which can stimulate brains and energies of retirees who are anxious to try something to give them involvement and income in the business world. There is a virtual bonanza for the networking/multilevel marketing company that taps this market.

Exclusive Products:

New products abound almost daily. It’s difficult to get an edge on the market unless you can get exclusivity. Some new products that have strong market appeal will be protected by patents; a registered design may be another option for future networking/multi-level marketing companies, who want to get the edge on competitors and retain their field people.

Training, Advertising and Public Relations:

There is no doubt in our minds that training will become a major emphasis in the future. Networking/multi-level marketing companies with up-market advertising and public relations will change public perception of and response to the difference between the carious networking/multilevel marketing groups.

THE 8 PILLARS OF EXCELLENCE THAT INDICATE STABILITY AND EQUITY IN A MLM BUSINESS:

PILLARS OF EXCELLENCE

1. INTEGRITY

The quality of possessing and steadfastly adhering to high moral principles or professional standards, and a means of maintaining those standards.

a. Court cases past, pending & current

b. Board of directors

c. Shareholders (owners)

d. Corporate structure

e. Stability ratio- Debt/Credit levels

1. MISSION STATEMENT

a. Destiny focus

b. Pride of association (“sloganized” identity)

c. Competent and authoritative Board Governors

2. QUALITY PRODUCT OR SERVICES

a. Thoroughly tested to live up to claims

b. Efficient delivery system

c. Client communication and updates

3. VALUE

a. product

b. time input

c. permanence of tenure

4. PLAN

a. Qualifying the new recruit

b. Defined goals

c. Economic benefits (substantiated by evidence)

d. Measurements and time frames

e. Fiscal advantages

f. Promotion of participants

g. Next generation training

5. TRAINING

a. Manual of Study & Education (multi lingual where applicable)

b. Hybrid external input

c. Career track options and graduated training

d. Schools & universities curriculum promotion

e. Personal mentoring and role model blueprint

f. Public speaking training

g. Law, responsibilities and accountability

h. Sustainability and expansion

i. Savings, reserves and retirement skills j. Long term economic plan

k. Relevant and inspiring seminars

6. INTERNATIONAL BUSINESS OPTIONS

a. Culturally sensitive

b. Legally sound

c. Diversification opportunities

7. DISPUTE RESOLUTION

a. Arbitration panel representing all levels of operations

b. Pre agreed penalties and remedies

8. INHERITABLE STRUCTURE

a. Wills, Trusts, and Estate Planning

b. IS IT REALLY YOUR BUSINESS, or are you building for another?

ABOUT THE AUTHORS

PETER J DANIELS

Founder and Chairman

World Centre for Entrepreneurial Studies

Coming from a poor dysfunctional family background and suffering from ill health and dyslexia, Peter Daniels never passed one grade at school. However, from this humble beginning he developed a deep faith in God and confounded the skeptics. At over seventy years of age he still aspires, works and looks like someone much younger. Peter has authored numerous books and self help programs that span the world in several languages. This material has been endorsed by such greats and personal friends as, Dr. Norman Vincent Peale, W Clement Stone, Dr. Robert Schuller, Paul J Meyer, Richard Devos, and Dr John Haggai to name a few.

Since his first stage appearance at a MLM Convention in 1988, Peter Daniels has been the speaker of choice at many MLM conventions globally. In August 1993, he was keynote speaker at the World Congress of the Direct Selling Association held in Kuala Lumpur, Malaysia, and regularly receives standing ovations at MLM conventions attended by tens of thousands. His book “Global Survey into Multi-level Marketing” co-authored by his son Graham, was first published in 1992, and has become a reference throughout the world for those contemplating a vocation in multi-level marketing.

Peter has served as advisor on the board of two prominent MLM companies. He is known for endorsing the industry openly, which carries much credibility as he is not directly involved or aligned with any particular MLM company. MLM companies have recorded and sold his lectures by the thousands of which he welcomes and accepts no royalty, demonstrating the bone fides of his endorsement of MLM in its pure form.

Happily married to Robina for over 50 years he enjoys the love, friendship and support of a very close knit family with three children and eight grandchildren.

PETER J DANIELS

A BRIEF HISTORY

While coming from a poor dysfunctional family back-ground and suffering from ill health and dyslexia he never passed one grade at school. However, from this humble beginning he developed a deep faith in God and confounded the skeptics. At over seventy years of age he still aspires, works and looks like someone much younger.

Happily married to Robina for over 50 years he enjoys the love, friendship and support of a very close-knit family with three children and eight grandchildren.

The mass media at times has called him an ‘adrenalin charged salesman,’ a ‘religious nut’ and a ‘battle scarred champion’ of a dozen crusades when he legally and publicly fought against the purveyors of pornography.

The business community has said of him ‘he could motivate an Egyptian mummy to walk’ and yet others call him an ‘International Business Statesman’. Church leaders refer to him as a missionary to the business world and a merchant of hope, and speak widely of his generosity.

Books, magazines and newspapers print stories about his life that is often featured on radio, television talk shows, news reports and YouTube. Schools and students throughout the world write essays about his life, his humble beginnings and his determination to succeed in whatever task he has before him. One newspaper said “he expects everything to be done yesterday and has an uncanny way of making sure that it is”.

He has received honors from universities, theological colleges, governments, business and humanitarian organizations from around the world.

Thousands flock to hear him speak wherever he travels across the globe and his books sell at a frantic pace. One of his presentations recorded on the subject of encouragement is attributed to have sold over one million copies.

He is a genius at creating simple business formulas to solve difficult problems and has spoken to more live audiences throughout the world than any other Australian.

The rise and rise of Peter J Daniels was painfully slow commencing fulltime menial work at thirteen years of age until he became a bricklayer and stonemason working piecework sometimes from 6am to 10pm seven days a week. The turning point in Peters life was when he became a born again Christian at a Billy Graham Crusade on May the 25th 1959 in South Australia. Not long after that event, he believed that God had given him two dreams. The first was to see how much money one human being could give away in their lifetime and the second, was to change the world for 300 years. In pursuit of these dreams he purchased three dictionaries to learn words and practiced pronunciation and speech by listening to British broadcasters on radio who in those early days spoke impeccable English. Without a tutor or mentor he studied economics, politics, modern and ancient history, theology, law, philosophy and business.

He soon discovered that the mind was like a muscle and could be developed, and has now personally read over 8,000 biographies. Although he failed three times in business he never went bankrupt but persevered and met his commitments. For nearly two decades he built a thriving business in real estate in Australia with South-East Asian connections and finally sold out to follow other business pursuits.

In 1984 he launched his first book that was the catalyst of the World Centre for Entrepreneurial Studies, which today with a no debt philosophy, is one of the largest suppliers of Christian business education programs and books in the world.

Record of Business & other Involvements

1959

Became a Christian

1963

Built the largest Christian Endeavor Youth Group in Australia

1967

Commenced real estate involvement

1971

Decisive legal victory against the purveyors of pornography

1972

Key figure in the founding of the “Festival of Light” in Australia

1975

Lieutenant Colonel Aide De Camp Governor Staff by Governor George Busbee in the State of Georgia

1976

Personally sponsored and created a large evangelistic Christian Outreach Program in South Australia

1976–1991

Youth for Christ Australia Chairman of the Board

1977–1989

Haggai Institute of Advanced Leadership Board Member and International Director

1980–1991

Youth for Christ International World Treasurer covering 114 countries

1980–1999

Robert Schuller Ministries International Director “Hour of Power”

1981–2001

Director International Corporate Holdings Pty Ltd

1984

World Centre for Entrepreneurial Studies President and Founder

1986

Kentucky Colonel by Governor Julian M. Carrol, State of Kentucky

1987

Honorary Citizen Austin Texas by Mayor Frank C. Cooksey

1988

World Ambassador, World Expo Brisbane Australia

1988

Created personal tutorials on business

1989

Completed ten books

1989

World Ambassador for Life Youth for Christ

1989

Special Ambassador of State on Economic Affairs, Appointed by His Excellency President Lennox Sebe For the Nation of Ciskie Southern Africa

1992

Honorary Doctor of Humanities, March of Faith Bible Institute, Houston Texas

1993–1999

International Director Worldwide Leadership Council

1995

Honorary Doctor of Letters Oral Roberts University

1997

Australia Fair Pty Ltd (Strategic Intelligence & Bullion Company) Chairman

2001

Counsel to the Board of Anglo Far-East Bullion Company

Presented with the United States Marine Ceremonial Sword for Life Achievement

2005

Founder and Co-chairman of The Gabriel Call (the largest economic thrust in the Christian church in the history of Christendom, with a goal to train one million Entrepreneurs in 20yrs to release 200 billion dollars for Christian Evangelism.)

2006

Honorary Doctor of Sacred Letters from Jacksonville Theological College

2006

Chairman of the Board of Counsel Dan El Private Estates.

2007

Over the past twenty years has conducted nearly one thousand business seminars in Christian churches globally.

2007

International College of Excellence, Master of Christian Leadership and Doctor of Christian Philosophy in Business.

2007

The March of Faith School of Ministries, Doctor of Humane Letters.

2008

Presented and signed by the Governor of Volgograd (Stalingrad) The Encyclopedia of the Battle of Stalingrad in Russia 1942–1943

ABOUT THE AUTHORS

GRAHAM K DANIELS

Graham Daniels is a citizen and resident of Australia, and is a very private person. Married to Leanne in 1980, and with two children, Taliah and Jake, they live on a 140-acre family property in the Adelaide Hills, South Australia. He is a fourth generation Australian, born on November 25th of 1957 to Peter and Robina Daniels. One of three children.

Although involved in numerous projects worldwide, with respect to the topic of this publication Graham served as consultant to the Board of Directors and owners of an international MLM company (1987–1989), was hired to assist a USA based MLM in its expansion and development (1997), and designed and implemented a unique compensation plan for a precious metals MLM project. (1998). Due to his open endorsement of the MLM system particularly as a non-participant, he has over many years enjoyed friendship with high pin levels and owners of various prominent MLM companies, sharing conversations in their homes, conventions and private dinners. It is from these encounters and through private consultancy, that Graham has gained much understanding of the aspirations of the owners, the dangers of legislation, the fears of the recruits in the field, and the strengths and weaknesses of the various corporate operations.

As an advocate of the MLM system in its pure form, Graham has taken the time to pen in this book, valuable insights revealed in this survey, which will assist those like he, who seek to rescue this worthy industry.

A BRIEF HISTORY

Having left school at age seventeen Graham went to work in his father’s Real Estate business as a laborer on building sites, working his way to general repairs, maintenance and property renovations.

At age 20 Graham was approached by a national wholesale jewelry firm, to market silver, gold and gemstones throughout South Australia and the Northern Territory, which was his introduction to “sales” and the ‘value of gold’. His way with people was soon recognized and two years later, Graham was invited to work with an insurance broker who specialized in life insurance as a means for clients to gain a personal or business tax advantage. He continued to explore the business world having formed a joint venture insurance brokerage writing business in the area of “internal fund superannuation” and “single premium investment policies” for some of Australia’s largest insurance companies (Australian Eagle, Security Life). His achievements in sales were such that in 1981, at the age of 24, Graham was invited by Lumbly’s Insurance Company to be a guest at the Million Dollar Round Table Annual Luncheon.

In 1983 at the age of 26, Graham was invited to the board of Corporate Consultants International Ltd. (CCI) a prestigious and specialized tax planning practice, which complimented his insurance brokerage business. CCI marketed tax effective investments, including such programs as cattle leasing and aircraft syndications. He soon added to his business portfolio, fundraising for the South Australian Film Corporation and Australian Film Commission, through a tax incentive investment scheme introduced by the Australian Federal Government. In 1985 Graham launched Transact Corporation, an Australian based tax, finance, and investment company.

During the eighties, while heavily involved in numerous business ventures including opal mining at Coober Pedy, Time-share Marketing and Commercial Real Estate sales and leasing, Graham’s father (Peter Daniels) had begun writing books based on his life’s journey from an illiterate bricklayer at age 26, to multi millionaire. Graham and his father Peter had worked together on numerous projects, and the unique blend of their joint backgrounds was soon recognized, as they were jointly sought after and contracted as consultants to the boards of organizations for their skills in corporate and strategic business planning. They began to travel the world extensively. Such was the international recognition of Graham Daniels’ ability and skill in the area of strategy and negotiation that in 1994, on invitation, met in New York with the UN ambassador of a communist country, and was commissioned to prepare and present a paper to their government on ‘an Interim Strategy for Business Growth’ to develop hard currency.

The Australian Collegiate School of Entrepreneurs (1988) was the research and education arm managing the marketing of his father’s literature where Graham served as Vice President and which grew to become the World Centre for Entrepreneurial Studies (1992). This centre regularly conducted seminars on four continents, and inspired thousands to personal growth and the entrepreneurial spirit. The centers’ emphasis of publishing self-help material and acting as global advocate of a free market economy was well respected.

In the late 90’s, while working on a strategic information and precious metals start-up company (Australia Fair), Graham was invited to be Executive Producer of a somewhat controversial documentary on economics and morality. This Documentary won Gold at the “U.S. International Film and Video Festival” held in Chicago in 1999. That same year the Australia Fair project went global under the banner of Australia Fair International, with the opening of its first overseas office in Vanuatu. In 2001 Australia Fair International became the Anglo Far-East Bullion Company where Graham served as Chairman for 5 years, with an international board serving from four continents through its head office in Panama City. Anglo had made its mark of integrity in the highly competitive bullion world.

Today Graham is recognized for the reputation he has earned not only as an astute businessman, but also as a lecturer of substance on subjects relating to economics, morality, asset protection and business strategy. He has lectured in South Africa, Australia, Hong Kong, New Zealand, Vanuatu, Fiji, Cook Islands, USA, Canada, Singapore, UK and Malaysia on subjects ranging from, ‘The Banking System’, ‘The Market Economy’, ‘Trends and Cycles’, “Relationships”, “Leaving a Heritage to your Children’s Children” and “Taxation.... the Divine to the Ridiculous!” (Graham is a member of the International Tax Planning Association, Cayman Islands)

The attendees to his seminars have included bankers, professors, teachers on economics, stockbrokers, congressmen, Lawyers and Judges, clergy, businessmen and women, and families and individuals from all walks of life.

Graham is a strong advocate of “The Market Economy” in its pure form. His lectures on this subject are always well received, and are a practical and refreshing alternative to the “debt based, fiat currency, government interference” models of the west. Graham’s interest in the market economy goes beyond theory. Evidence of his practical approach can be seen in a project he heads up on the Pacific Islands of Vanuatu, where Graham is “field testing” economic theory, by applying market economy principles to the native people of the Mele Village. This project is run debt free, and under the banner of the local village church.

Graham has resigned from all his previous interests, including the position of Chairman to the Board of The Anglo Far East Bullion Company to pull together what he believes is the pinnacle of his life’s journey thus far.... “Dan El”. The Dan El project is the prestigious niche market of Private International Estate Planning, with its office in Geneva Switzerland. (www.DanEl.ch)

Graham’s balanced lifestyle clearly demonstrates the priority he places on family life as he continually advocates the importance of family as the building block of society. He is often heard saying,” As the family goes.... so goes the nation”.

Both in Australia and overseas, his private counseling based on his background, practical knowledge and personal experience in business has put him in continual demand. With no advertising or soliciting he is sought after by total strangers, often with the preface, ‘you don’t know me but you helped a friend of mine and he suggested that I contact you’. Due to his ‘street smarts’ and calm ability to negotiate confidently, even from a position of apparent weakness, he has saved many people form hardship, heartbreak and financial ruin. The response to his involvement expressed by thank-you notes and complimentary letters tell the story.

The requests that come to him for counsel, and invitations to sit on Boards and to be involved in ‘opportunities and deals’, are the evidence of what his life has achieved thus far, the valued estimates that people have of him, and the ‘edge’ they perceive he can offer. His involvement in projects of compassion throughout the world has produced emotional letters of gratitude from people he has never met.

In his own words:

‘I refuse to take full credit for my achievements, as I recognize that I come from a fortunate country and family background, I have seen many facets of life and have had the foundation of numerous adventures and experience at a young age. I will always be thankful to God’.

For all of the above, Graham’s greatest claim to fame is the fact that his family under God and his relationships with them are his most valuable asset and his greatest achievement.

OTHER INVOLVEMENTS

www.havilahbullionbank.ch

OTHER INVOLVEMENTS

www.gabrielcall.com
Economic Rescue for Local Churches