DENNIS SEID: The 'unique opportunity' could be a costly error

You’ve probably been approached by a friend – or a friend of a friend – to get in on a “unique opportunity” that can provide you with some great income.
So why not listen?
We’re not talking about only those get-rich-quick schemes on television, which are many. The most popular ones deal with real estate.
For example, some genius is willing to show you how he made a fortune by buying distressed properties and flipping them for a great return.
And he’s willing to share his secrets – for a small fee, of course. You don’t seriously think he’s doing this for fun, do you?
He made a fortune by selling his idea to thousands of other people for a couple of hundred bucks. Those people, in turn, discover that part of the “secret” is to sell the idea to another group of people and so on.
But another scheme that has been around for years has been multi-level marketing, or MLM. It’s also called network marketing or referral marketing or direct selling.
Close look
I’ve attended several of these “meetings” over the years, with a variety of products and services being pitched. My first meeting happened about 15 years ago.
A business acquaintance invited me to a “very special” meeting with a select group of people to hear a presentation that would supposedly knock my socks off.
Dinner and drinks would be provided. No commitment was necessary.
After about a dozen pleas to attend one of these sessions, I went.
I forget who the company was, but it had something to do with cleaning products. But not just any cleaning product. It was environmentally safe and used all over the world.
The key was for us to sell the product and get others to sell it, too. The more people we got to sell it, the more commission we would make. Move up the ladder and become a leader or director and your income could grow. The more your people sold and recruited others, the better off everybody was.
If you recruited just two or three people and they recruited two or three people, the money would be pouring in. Enough that you could even possibly quit your full-time job.
There were testimonials about success stories. There were people in the audience shouting and hollering. There was excitement in the air.
Sign up now while there are only a few people in it! And the entry fee is reduced, too.
A scheme is a scam
Call it what you will, but it was a pyramid scheme. Somebody’s making big money, but it won’t be you or me. And these schemes are still around.
If part of the compensation package means having to recruit other people to sell the product or service, then your antenna should be raised.
In fact, the Federal Trade Commission warns that multi-level marketing organizations with greater incentives for recruitment than product sales are to be viewed skeptically.
Are all MLMs to be avoided like the plague? Not necessarily.
But before you jump into an “opportunity,” do a little research. The Internet is a great tool.
And remember this phrase: caveat emptor. Let the buyer beware.
Contact Dennis Seid at (662) 678-1578 or dennis.seid@djournal.com.

Dennis Seid / NEMS Daily Journal