How to Spot Pyramiding Scheme

I guess all of us would agree that Pyramiding Scheme is something to be avoided. It is an illegal business transaction and many lives were destroyed financially because of the enticing promises of “Good Future” and short-cut “Road to Success” offered to the unsuspecting individuals who are in a hurry to become rich. The sad thing about it, is that most people who joined in this scheme find themselves more miserable than they were before..

The scrupulous recruiters of Pyramiding craftily hide it under the guise of Multi-Level Marketing (MLM). There is a very thin-line of distinction between Pyramiding and MLM. However, the latter is a legitimate business model while the former is otherwise..

In order not to fall into this kind of trap, I would like you to take a look at these three elements mentioned below:

1. You need to pay an upfront payment and be a member in order to join the program.
2. There’s no value for money in your investment. You do not get a product equivalent to your investment,. Sometimes, you get a product but if you compare similar goods in the market, the price is far too high. In some cases, there are no goods involved at all.
3. You are encouraged to recruit people to join the system in order for you to recover your upfront payment. Because of this, your focus now shifts to recruiting prospective members instead of marketing the goods or services offered by the company. It also helps to ask yourself this question before making the decision to invest in this kind of business model:

"Does the scheme involve putting up of investment (entry fee and purchase of goods, or purchase of goods alone) for the opportunity to receive earnings derived primarily from recruiting, rather from sales? "

If the answer is yes, then most likely it is pyramiding.

If you ignore them especially symptoms No. 2 and No. 3, chances are that it will only be a matter of time and you’ll realize that you are in a middle of financial mess and worst of all, your recruits will be blaming you because you unknowingly put them in the same worst financial condition as yours. I’m sure you don’t want that to happen. Now that you already know the signs, it will be easier for you to spot pyramiding.

So.. the next time someone approaches you and introduce you to some sort of “network marketing business or MLM”, don’t jump in right away, be more cautious and take time to make a research and investigate before making the mistake of putting your hard earned money in it. Make sure that it is not Pyramiding in Disguise. Protect your money. Invest Wisely.