Pyramid system needs to watch out for
In Indonesia today has evolved through a system of Direct Sales Pyramid. System on the face of the pyramid-like Multi Level Marketing and quite a lot of people have been involved as a member, more accurately called this system under the pretext that the Multi Level Marketing.
Pyramid Systems, which offers the opportunity for large profits with little effort, actually had also run in Taiwan, the United States, Malaysia and other countries, but in relation to the number of complaints from its members, now in the countries of this system monitored strictly by the local government because it is considered harmful and disturbing the public. Among these companies many have closed down.
Pyramid System Rules
* Registration Fee The following membership packages of products, very expensive.
* No Cover Point (no re-order purchase of the product).
* The selling price of its products are also very high, one can reach more than 10 times the market price of similar products.
* The system is like a Multi Level Marketing, but not the same. For example each member be limited to a maximum of 2 people recruited. Two of these, recruited two other people and so on up to form a pyramid also other ways like this way, such as recruiting max. 3,4,5 members.
* One of the members may "buy" more than 1 account (called lots).
* Rewards are given based on tersusunnya a pyramid-shaped network with a number of people in a certain format; rewards are not based on the volume of sales presentations and no element should market the product to the consumer.
* The membership is sometimes lasted a very short (only up to the formation of a particular format). In contrast to the direct sales company, where members can be active at least 1 year or even a lifetime.
* Program marketing (Marketing Plan) pyramid scheme is very complicated and difficult to learn. Rekruting emphasis on, not on sale.
What's the difference with a direct sales business?
In the world of direct sales, both in Indonesia and at the international level, there are 3 systems that have been running very long, which is the conventional system or the Single Level Marketing (including party plan), systems and system Limited Level Multi Level or Multi Level Marketing.
* All the same income opportunity for anyone who want to try based on partnership.
* The foundation of the same business consists of 3 things, namely to recruit, educate, and motivate its business partners are commonly referred to Distributor or Dealer.
* All the same membership registration charge to the distributor / dealer with the proper values in accordance with the starter kit is available.
* All share a number of products (goods or services) with a reasonable price to be sold through the distributor / dealer to consumer. Based on the sales volume achieved, the Distributor / Dealer get rewarded with commissions and incentives and a variety of interesting gift amount and the amount is not limited.
* All are equally enforce a system whereby members get a membership only and should not be more.
* For the Distributor / Dealer who actively work income opportunity is certainly there.
* Program marketing (Marketing Plan) simple and transparent.
The rules of the differences mentioned above, it appears that the pyramid system:
1. Entrap and mislead the public and its members, because:
* Can be classified as gambling revenues since the acquisition is beyond the control of members who are at lower levels, the main income is not derived from sales of goods and services, but mainly from rekruting others to achieve a specific format.
* No income opportunities are equitable and fair as befits a company that offered to run the system, including MLM Direct Sales.
* Disadvantage members who have paid the following fee package is very expensive products, then have trouble selling these products to the public because the company's goals is to use the product simply as a cover to withdraw funds from the community and not be trained how to sales.
*
Harming the public who buy the products of the pyramid system, because the price is far beyond the price of similar products on the market.
Contrary to the basics of direct sales system and code of ethics that applies.
* It is a metamorphosis from the Chains of the system has been banned in many countries.
* The rules are very similar to that of Chains:
* Offer significant fee (revenue derived primarily from the member registration fee is not from the sale of products / services)
* Items provided by the business only for camouflage purposes, because the emphasis is more on business and members of the network format is not always obliged to take much less product purchased trained to sell again.
Is it a pyramid scheme? The things you need to know about Pyramid Sales Schemes Berjenjang - legal income opportunities How to distinguish between legal business with pyramid schemes disguised How to protect yourself from investment plunges and where you can get help
Do not make costly mistakes
Thousands of people in the world has lost millions of dollars since joining the marketing system with pyramid schemes. Many of the victims realized that they were gambling (although they did not know that they are trapped). However, there are many other victims thought that they were paying for the initial capital to open his own business. These people have been duped by pyramid schemes disguised to look like a legitimate business.
This paper aims to help you avoid the trap pyramid schemes, whether simple or disguised. A simple pyramid system very similar to chain letters, pyramid system while disguised as a wolf in sheep's clothing, hiding their true nature in order to deceive potential investors and officials fooled Law.
Does Pyramid Scheme?
Pyramid scheme is a system of (illegal) where many people who are at the bottom of the pyramid pay money to some people who are in the top layer of the pyramid. Every new member the opportunity to buy up the top layer and benefit from others who join later. For example, to become a member you may have to pay the start from a small amount to millions of rupiah. In this example, you have to pay Rp. 10 million, to buy a place on the pyramid at the bottom. Your money worth Rp. 5,000,000 people will move to another position just above you and the other Rp 5.000.000 move to the top of the pyramid, or to the promoter. If all positions are available within the scheme has met the participants, the promoter will receive USD 160 million, whereas you and other friends who are both located at the bottom will lose USD 10 million per person. If the promoter has paid off, then the position was eliminated and that the second layer will rise to the top. After that, then the two men who had been on the second layer will enjoy the benefits. To pay for these two, the bottom layer plus 32 new positions, and the search for new participants continues.
Each time a layer up to the top, a new layer must be added to the base of the pyramid, each 2 times more than before. If sufficient number of new participants, so you and 15 other participants who are on the same layer may be able to reach the top. However, to collect benefits for you, it takes only 512 participants, where half of them will lose Rp. 10 Million. Of course, this pyramid may collapse long before you reach the top because of rekruting not reached. In order that each participant can make a profit, is always needed new participants.
But in reality, the number of new participants is limited and each new layer has an opportunity to recruit others, smaller and the chance of losing money even larger.
The things you need to know about pyramid schemes:
1. Pyramid schemes are based on a simple mathematical concept.
2. This scheme to deceive. Pyramid scheme participants, consciously or not, they deceive people recruited. Not many people are willing to become participants and pay when the whole concept of the game explained to them.
3. This scheme is illegal. In many countries these schemes are prohibited, there is a serious risk that the business was closed by the government pyramid, and the participants subject to fines and imprisonment.
Why do people want to pay to participate in a pyramid?
Pyramid scheme promoters are masters of group psychology. At the recruitment of new participants, they create a frenzied atmosphere and enthusiastic group in which the pressure and promises of easy money, raising fears people will be losing a good opportunity. Considerations and questions candidates ignored. It's hard not to be tempted to survive unless you are absolutely sure that this concept is to trap you.
Disguised pyramid schemes - like the wolf in sheep's clothing
Some pyramid promoters try to create a scheme that looks similar scheme with tiered sales methods. Tiered sales is a legal business system and network independent business partners to sell products directly to consumers.
In order to look like a tiered sales company, Pyramid Scheme provides a range of products, expressed as sales of products to be marketed directly to consumers. However, in reality almost no effort at all to market these products to consumers. In contrast, income is created by recruiting new members. Also new business partners are forced to buy as many products of great value when the participants fill out a form.
For example, you may have to buy a product that does not benefit worth USD 10 million in order to become "business partners". The person who recruited you get a commission USD $ 5,000,000 (50%) and Rp 5.000.000 rest flew to the top (in this case the company). Consider common with pyramid schemes in the previous description.
However, most disguised pyramid not so easily dismantled unmasked. Pyramid schemes often choose products low production costs but has no value in the market, such as magic products new inventions, exotic treatments and so on. Thus difficult to explain whether such products actually have a market share. The best way to avoid the trap of disguised pyramid is to know exactly what you want from legal income opportunities.
Multi-level sales and sales of single-level - a legal income opportunities
Multi-level sales and sales of one level is a popular way to sell products in retail, not through a store clerk who uses, but through an independent entrepreneur (business partners) directly into the hands of consumers. As business partners, you can determine their own hours and earn money by selling products the company produced a fairly well-known.
In tiered sales structure and one level of sales you can also build and maintain their own sales group by recruiting, motivating, providing products and training to them. Your income will include your group sales presentation and your own sales to consumers. This opportunity has made tiered sales and sales of one level becomes an interesting way to start a business with little initial capital.
Differences between legal business with disguised pyramid schemes
Pyramid schemes seek opportunities to get money from you. Multi-level marketing company and the sale of one level to find opportunities to make money with you when you build your business and sell products directly to consumers.
Before you officially became a member (partner) of a company, investigate carefully. A good way to start is to ask 3 things below tesebut to yourself:
1. How much should I pay to become a partner?
2. Does the company want to buy back unsold products, if I resigned?
3. Does the company's products are sold to consumer?
* What does it cost to become a partner? When a large value, be careful
Initial costs in a tiered sales organizations are relatively small. Companies typically make it easy and economical for you to start selling. In contrast, pyramid schemes, creating almost all the benefits of recruiting costs of new participants. That is why, the cost to become a partner is usually very large.
PYRAMID CAREFUL disguise OFTEN COST PUTTING THE PARTICIPANTS WITH THE PURCHASE COST OF PACKAGE TRAINING, COMPUTER SERVICES AND PRODUCTS.
* Purchases may not be expensive or even unnecessary, but there will be pressure to "use the most of opportunities
* How to return a product? Cornered IF YOU CAN ASSUME THE PRODUCT THAT IS NOT SOLD OUT, BEWARE!
Companies that are legal and usually requires the purchase of the product will "buy back" products that do not sell if you decide to resign from the business. Some local laws require the repurchase value of approximately 90% of the actual value for the product in marketable condition.
* Is the product sold to consumers? IF THE ANSWER IS NOT (OR NOT MANY)
This is the key. Tiered sales system and direct sales (as well as retail sales system for that matter) rely on sales to consumers and market development. This requires quality products and competitive prices. In contrast, pyramid schemes do not pay attention to poduk sales to consumers. Advantages created from the number of new members who purchase the product, not because of its usefulness or cost element of interest, but because there is an element of compulsion to buy. Purchasing products should not exceed the realistic ability to sell. Another way is to use the pyramid system without forcing a purchase of products but encourage you to recruit as many people as possible who would each put up some money with the lure will earn more money.
How to protect yourself from investment plunge?
1. Take time. Do not let anyone force you. Good opportunity to build a business in tiered sales structure and marketing of one level will not disappear overnight. People who say "go right now" gives the impression as if those who join later will not get anything. BE CAREFUL!
2. Ask the following things:
* About the company and its management
* About the value of the product on the market, and market potential in your area to sell to consumer users of the product.
* About the cost of membership (including compulsory purchase)
* About warranty repurchase unsold products if you resign.
* About the average earnings of active business partners
3. Ask all the available company literature
4. Consult with others who have had experience with the company and its products. Further examine whether these products actually sold to consumers.
5. Investigate and cocokkanlah truth all the information you receive. Do not assume that the official documents that seem accurate or complete.
(Quoted from various sources on the internet)
In Indonesia today has evolved through a system of Direct Sales Pyramid. System on the face of the pyramid-like Multi Level Marketing and quite a lot of people have been involved as a member, more accurately called this system under the pretext that the Multi Level Marketing.
Pyramid Systems, which offers the opportunity for large profits with little effort, actually had also run in Taiwan, the United States, Malaysia and other countries, but in relation to the number of complaints from its members, now in the countries of this system monitored strictly by the local government because it is considered harmful and disturbing the public. Among these companies many have closed down.
Pyramid System Rules
* Registration Fee The following membership packages of products, very expensive.
* No Cover Point (no re-order purchase of the product).
* The selling price of its products are also very high, one can reach more than 10 times the market price of similar products.
* The system is like a Multi Level Marketing, but not the same. For example each member be limited to a maximum of 2 people recruited. Two of these, recruited two other people and so on up to form a pyramid also other ways like this way, such as recruiting max. 3,4,5 members.
* One of the members may "buy" more than 1 account (called lots).
* Rewards are given based on tersusunnya a pyramid-shaped network with a number of people in a certain format; rewards are not based on the volume of sales presentations and no element should market the product to the consumer.
* The membership is sometimes lasted a very short (only up to the formation of a particular format). In contrast to the direct sales company, where members can be active at least 1 year or even a lifetime.
* Program marketing (Marketing Plan) pyramid scheme is very complicated and difficult to learn. Rekruting emphasis on, not on sale.
What's the difference with a direct sales business?
In the world of direct sales, both in Indonesia and at the international level, there are 3 systems that have been running very long, which is the conventional system or the Single Level Marketing (including party plan), systems and system Limited Level Multi Level or Multi Level Marketing.
* All the same income opportunity for anyone who want to try based on partnership.
* The foundation of the same business consists of 3 things, namely to recruit, educate, and motivate its business partners are commonly referred to Distributor or Dealer.
* All the same membership registration charge to the distributor / dealer with the proper values in accordance with the starter kit is available.
* All share a number of products (goods or services) with a reasonable price to be sold through the distributor / dealer to consumer. Based on the sales volume achieved, the Distributor / Dealer get rewarded with commissions and incentives and a variety of interesting gift amount and the amount is not limited.
* All are equally enforce a system whereby members get a membership only and should not be more.
* For the Distributor / Dealer who actively work income opportunity is certainly there.
* Program marketing (Marketing Plan) simple and transparent.
The rules of the differences mentioned above, it appears that the pyramid system:
1. Entrap and mislead the public and its members, because:
* Can be classified as gambling revenues since the acquisition is beyond the control of members who are at lower levels, the main income is not derived from sales of goods and services, but mainly from rekruting others to achieve a specific format.
* No income opportunities are equitable and fair as befits a company that offered to run the system, including MLM Direct Sales.
* Disadvantage members who have paid the following fee package is very expensive products, then have trouble selling these products to the public because the company's goals is to use the product simply as a cover to withdraw funds from the community and not be trained how to sales.
*
Harming the public who buy the products of the pyramid system, because the price is far beyond the price of similar products on the market.
Contrary to the basics of direct sales system and code of ethics that applies.
* It is a metamorphosis from the Chains of the system has been banned in many countries.
* The rules are very similar to that of Chains:
* Offer significant fee (revenue derived primarily from the member registration fee is not from the sale of products / services)
* Items provided by the business only for camouflage purposes, because the emphasis is more on business and members of the network format is not always obliged to take much less product purchased trained to sell again.
Is it a pyramid scheme? The things you need to know about Pyramid Sales Schemes Berjenjang - legal income opportunities How to distinguish between legal business with pyramid schemes disguised How to protect yourself from investment plunges and where you can get help
Do not make costly mistakes
Thousands of people in the world has lost millions of dollars since joining the marketing system with pyramid schemes. Many of the victims realized that they were gambling (although they did not know that they are trapped). However, there are many other victims thought that they were paying for the initial capital to open his own business. These people have been duped by pyramid schemes disguised to look like a legitimate business.
This paper aims to help you avoid the trap pyramid schemes, whether simple or disguised. A simple pyramid system very similar to chain letters, pyramid system while disguised as a wolf in sheep's clothing, hiding their true nature in order to deceive potential investors and officials fooled Law.
Does Pyramid Scheme?
Pyramid scheme is a system of (illegal) where many people who are at the bottom of the pyramid pay money to some people who are in the top layer of the pyramid. Every new member the opportunity to buy up the top layer and benefit from others who join later. For example, to become a member you may have to pay the start from a small amount to millions of rupiah. In this example, you have to pay Rp. 10 million, to buy a place on the pyramid at the bottom. Your money worth Rp. 5,000,000 people will move to another position just above you and the other Rp 5.000.000 move to the top of the pyramid, or to the promoter. If all positions are available within the scheme has met the participants, the promoter will receive USD 160 million, whereas you and other friends who are both located at the bottom will lose USD 10 million per person. If the promoter has paid off, then the position was eliminated and that the second layer will rise to the top. After that, then the two men who had been on the second layer will enjoy the benefits. To pay for these two, the bottom layer plus 32 new positions, and the search for new participants continues.
Each time a layer up to the top, a new layer must be added to the base of the pyramid, each 2 times more than before. If sufficient number of new participants, so you and 15 other participants who are on the same layer may be able to reach the top. However, to collect benefits for you, it takes only 512 participants, where half of them will lose Rp. 10 Million. Of course, this pyramid may collapse long before you reach the top because of rekruting not reached. In order that each participant can make a profit, is always needed new participants.
But in reality, the number of new participants is limited and each new layer has an opportunity to recruit others, smaller and the chance of losing money even larger.
The things you need to know about pyramid schemes:
1. Pyramid schemes are based on a simple mathematical concept.
2. This scheme to deceive. Pyramid scheme participants, consciously or not, they deceive people recruited. Not many people are willing to become participants and pay when the whole concept of the game explained to them.
3. This scheme is illegal. In many countries these schemes are prohibited, there is a serious risk that the business was closed by the government pyramid, and the participants subject to fines and imprisonment.
Why do people want to pay to participate in a pyramid?
Pyramid scheme promoters are masters of group psychology. At the recruitment of new participants, they create a frenzied atmosphere and enthusiastic group in which the pressure and promises of easy money, raising fears people will be losing a good opportunity. Considerations and questions candidates ignored. It's hard not to be tempted to survive unless you are absolutely sure that this concept is to trap you.
Disguised pyramid schemes - like the wolf in sheep's clothing
Some pyramid promoters try to create a scheme that looks similar scheme with tiered sales methods. Tiered sales is a legal business system and network independent business partners to sell products directly to consumers.
In order to look like a tiered sales company, Pyramid Scheme provides a range of products, expressed as sales of products to be marketed directly to consumers. However, in reality almost no effort at all to market these products to consumers. In contrast, income is created by recruiting new members. Also new business partners are forced to buy as many products of great value when the participants fill out a form.
For example, you may have to buy a product that does not benefit worth USD 10 million in order to become "business partners". The person who recruited you get a commission USD $ 5,000,000 (50%) and Rp 5.000.000 rest flew to the top (in this case the company). Consider common with pyramid schemes in the previous description.
However, most disguised pyramid not so easily dismantled unmasked. Pyramid schemes often choose products low production costs but has no value in the market, such as magic products new inventions, exotic treatments and so on. Thus difficult to explain whether such products actually have a market share. The best way to avoid the trap of disguised pyramid is to know exactly what you want from legal income opportunities.
Multi-level sales and sales of single-level - a legal income opportunities
Multi-level sales and sales of one level is a popular way to sell products in retail, not through a store clerk who uses, but through an independent entrepreneur (business partners) directly into the hands of consumers. As business partners, you can determine their own hours and earn money by selling products the company produced a fairly well-known.
In tiered sales structure and one level of sales you can also build and maintain their own sales group by recruiting, motivating, providing products and training to them. Your income will include your group sales presentation and your own sales to consumers. This opportunity has made tiered sales and sales of one level becomes an interesting way to start a business with little initial capital.
Differences between legal business with disguised pyramid schemes
Pyramid schemes seek opportunities to get money from you. Multi-level marketing company and the sale of one level to find opportunities to make money with you when you build your business and sell products directly to consumers.
Before you officially became a member (partner) of a company, investigate carefully. A good way to start is to ask 3 things below tesebut to yourself:
1. How much should I pay to become a partner?
2. Does the company want to buy back unsold products, if I resigned?
3. Does the company's products are sold to consumer?
* What does it cost to become a partner? When a large value, be careful
Initial costs in a tiered sales organizations are relatively small. Companies typically make it easy and economical for you to start selling. In contrast, pyramid schemes, creating almost all the benefits of recruiting costs of new participants. That is why, the cost to become a partner is usually very large.
PYRAMID CAREFUL disguise OFTEN COST PUTTING THE PARTICIPANTS WITH THE PURCHASE COST OF PACKAGE TRAINING, COMPUTER SERVICES AND PRODUCTS.
* Purchases may not be expensive or even unnecessary, but there will be pressure to "use the most of opportunities
* How to return a product? Cornered IF YOU CAN ASSUME THE PRODUCT THAT IS NOT SOLD OUT, BEWARE!
Companies that are legal and usually requires the purchase of the product will "buy back" products that do not sell if you decide to resign from the business. Some local laws require the repurchase value of approximately 90% of the actual value for the product in marketable condition.
* Is the product sold to consumers? IF THE ANSWER IS NOT (OR NOT MANY)
This is the key. Tiered sales system and direct sales (as well as retail sales system for that matter) rely on sales to consumers and market development. This requires quality products and competitive prices. In contrast, pyramid schemes do not pay attention to poduk sales to consumers. Advantages created from the number of new members who purchase the product, not because of its usefulness or cost element of interest, but because there is an element of compulsion to buy. Purchasing products should not exceed the realistic ability to sell. Another way is to use the pyramid system without forcing a purchase of products but encourage you to recruit as many people as possible who would each put up some money with the lure will earn more money.
How to protect yourself from investment plunge?
1. Take time. Do not let anyone force you. Good opportunity to build a business in tiered sales structure and marketing of one level will not disappear overnight. People who say "go right now" gives the impression as if those who join later will not get anything. BE CAREFUL!
2. Ask the following things:
* About the company and its management
* About the value of the product on the market, and market potential in your area to sell to consumer users of the product.
* About the cost of membership (including compulsory purchase)
* About warranty repurchase unsold products if you resign.
* About the average earnings of active business partners
3. Ask all the available company literature
4. Consult with others who have had experience with the company and its products. Further examine whether these products actually sold to consumers.
5. Investigate and cocokkanlah truth all the information you receive. Do not assume that the official documents that seem accurate or complete.
(Quoted from various sources on the internet)
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