Multi-Level Marketing (MLM) – Script

Presented by: Shaurya Shah

Opening

"Imagine a business model where your income isn’t just based on what you sell, but also on the
sales made by the people you bring into the system. Sounds exciting, right? But is it truly an
opportunity, or just a well-packaged trap? Today, we’re diving into the world of Multi-Level
Marketing—how it works, its potential, and the concerns surrounding it."

Slide 1: What is Multi-Level Marketing (MLM)?

"Let’s start with the basics. What exactly is Multi-Level Marketing?"

MLM is a direct sales strategy where participants earn money in two ways:

1. By selling products directly to consumers.

2. By recruiting new members and earning a commission from their sales.

It sounds simple, but MLM has a controversial reputation. Why? Because some programs
operate in ways that resemble pyramid schemes, which are illegal. That’s why organizations
like the Federal Trade Commission (FTC) investigate MLM companies to ensure they’re
legitimate.

Slide 2: How MLM Works

"So, how does MLM actually function?"

MLM operates on a hierarchical commission structure where:

Participants earn from personal sales and commissions from recruits.
The more people they recruit, the higher their earning potential.
But here's the catch: Success heavily depends on sales and recruitment skills.

This leads to a crucial question: Is MLM truly a business opportunity, or does it mostly
benefit those at the top?

Slide 3: Special Considerations

"Now, let’s talk about the big elephant in the room—MLM’s controversy."

Legality & Pyramid Schemes – MLM itself is legal, but pyramid schemes are illegal. The
difference?

• Legitimate MLMs focus on product sales to customers.

• Illegal pyramid schemes prioritize recruitment over product sales, paying people at the
top at the expense of those at the bottom.
 Income Potential – Studies show that only a small percentage of MLM participants earn
significant income, while the majority struggle or even lose money.

Risk vs. Reward – While some people profit, many face financial losses due to ongoing
costs like inventory purchases, training fees, and travel expenses.

Slide 4: Factors to Consider Before Joining an MLM

"If you’re thinking of joining an MLM, here are some crucial factors to consider:"

Sales Skills Are Crucial – Success depends on how well you can sell. If you’re not a
natural salesperson, MLM might be tough.

Financial Costs – Many MLMs require initial investments and ongoing expenses.
Consider whether you can afford it.

Your Network Matters – Having a strong personal and social network can improve your
chances of success.

Thorough Research – Before joining, research the company, its track record, and the
marketability of its products.

Don’t Rush – Many MLM recruiters create a sense of urgency to make you sign up fast.
Take your time, ask questions, and evaluate carefully.

Slide 5: FAQs – Spotting Red Flags

"How do you know if an MLM is actually a pyramid scheme?"

Red Flags to Watch Out For:

They promise huge earnings with little effort.
They emphasize recruitment over product sales.
They pressure you to "act fast" before you have time to research.
They make money primarily from new recruits buying starter kits, rather than selling
products to real consumers.

"If a company is focusing more on recruitment than product sales, it’s a warning sign."

Slide 6: Summary

"To wrap things up, let’s go over the key points one more time:"

MLM is a business model based on direct sales and recruitment commissions.

Some MLMs are legitimate, but many face criticism for pyramid-like structures.
Only a few people earn significant income, while most struggle to break even.
Success in MLM depends on strong sales skills, a solid network, and thorough
research.
Closing Statement

"At the end of the day, MLM can be an opportunity—but it’s not for everyone. Before joining, ask
yourself: Do I have the sales skills, financial stability, and patience to navigate this model? If
not, it might be worth reconsidering."

"Thank you for your time! Now, let’s open the floor to any questions you might have."

OR

Script: Understanding Multi-Level Marketing (MLM)

Opening (1-2 min)
(Confident and engaging tone)
"Have you ever come across an opportunity that promises financial freedom, flexible
hours, and unlimited earning potential? Maybe a friend or family member
enthusiastically introduced you to a business that sounds too good to be true?
Well, chances are, you’ve encountered Multi-Level Marketing, or MLM.
MLM is a business model that has been around for decades, attracting millions of
people worldwide with the promise of financial independence. But is it really as good as
it seems? Or is it just a well-disguised pyramid scheme?
Today, we’re going to break it all down—how MLM works, what to consider before
joining, and the risks involved. By the end of this session, you’ll have a clear
understanding of whether MLM is an opportunity worth pursuing or a financial trap to
avoid. So, let’s dive in!"

What is Multi-Level Marketing? (2 min)

(Explain with clarity)
"Multi-Level Marketing, or MLM, is a strategy used by some direct sales companies.
Instead of selling products in traditional stores, they rely on independent distributors
to sell products directly to consumers.
Here’s how it works:
1. Recruitment – Existing members bring in new recruits, expanding the network.
2. Commission-Based Income – Members earn money not only from their own
sales but also from a percentage of their recruits’ sales.
3. Hierarchy – The more people you recruit, the higher you climb in the structure,
earning commissions from multiple levels below you.
On the surface, MLM seems like a legitimate business. But here’s the catch—some of
these programs resemble pyramid schemes, which are illegal."

How MLM Works (2 min)

(Provide clarity with simple examples)
"To succeed in MLM, you need to do two things:
1. Sell the company’s products or services.
2. Recruit new members who also sell products.
The more people you bring in, the more commissions you earn. Sounds great, right? But
here’s the issue—most MLM participants don’t make significant money.
Studies show that the vast majority of people in MLM earn little to no profit. A select few
at the top make a fortune, while those at the bottom struggle to even recover their initial
investment.
This brings us to a crucial question—how do we separate a legitimate MLM from a
pyramid scheme?"

Special Considerations: Legality & Pyramid Schemes (2 min)

(Explain clearly and concisely)
"MLM is legal, but pyramid schemes are not. So, what’s the difference?
• A legitimate MLM focuses primarily on selling products to real customers.
• A pyramid scheme, on the other hand, prioritizes recruitment over product
sales.
In pyramid schemes, most of the revenue comes from new members paying to join,
rather than actual product sales. That’s why pyramid schemes eventually collapse—
there aren’t enough new recruits to sustain the model.
The Federal Trade Commission (FTC) investigates MLM programs to ensure they don’t
cross the line into illegal territory. But even if an MLM is legal, it doesn’t mean it’s a good
opportunity."

Key Factors to Consider Before Joining an MLM (2 min)

(Guiding the audience to think critically)
"Before you sign up for any MLM, here are a few important questions to ask:
1. Sales Skills: Do you have the ability to sell products consistently?
2. Financial Investment: Are you prepared for upfront costs and ongoing
expenses?
3. Your Network: Do you have a strong personal network to sell to?
4. Company Reputation: Have you researched the company’s track record?
5. Red Flags: Does the company push recruitment over product sales?
If the focus is on signing up more members rather than selling products, that’s a
warning sign. Be cautious!"

FAQs – Addressing Common Concerns (2 min)

(Engage with relatable scenarios)
"Now, let’s tackle some common questions:
1. Is MLM a guaranteed way to make money?
No. Most participants lose money or make very little. A few succeed, but usually, those
are the ones who joined early.
2. How do I spot an illegal MLM or pyramid scheme?
Look for these red flags:
• They promise huge earnings with minimal effort.
• They pressure you to recruit others rather than sell products.
• They emphasize that you need to join immediately or you’ll miss out.
If a business opportunity sounds too good to be true, it probably is."

Summary – The Truth About MLM (1 min)

(Conclude with a strong takeaway)
"Let’s summarize what we’ve learned:
 • MLM is a business model where distributors earn money through sales and
recruitment.
• While some MLMs are legitimate, many resemble pyramid schemes with high
failure rates.
• If you’re considering joining an MLM, do your research, assess your sales skills,
and watch for red flags.
The bottom line? MLM can be an opportunity for a select few, but for most, it’s a risky
venture with little financial reward. Make sure you go in with open eyes and realistic
expectations!"

Closing – Call to Action (1 min)

(End with an engaging thought)
"Now that you have all the facts, the decision is yours.
Would you join an MLM? Or do you think it’s a business model designed to benefit only
the top few?
Whatever you decide, always remember—knowledge is power. The more informed you
are, the better financial decisions you’ll make.
Thank you for your time, and I’d love to hear your thoughts or answer any questions!"