Is Amway’s operating model in line with the rules?

What are you doing, direct selling or MLM?

What are you doing, direct selling or MLM? This is a very interesting question.

What is direct selling? What is MLM?

Direct selling is a sales model in which direct sellers market products and services directly to consumers, and direct sellers provide corresponding services.

When it was introduced to Asia from Europe and the United States, Taiwan and Hong Kong were the earlier Chinese areas. Taiwanese translated it as "direct sales" because the terminal link was directly provided to consumers. Hong Kong people translate it as "pyramid marketing" because multi-level direct selling is introduced by one marketer to another marketer. In other words, Taiwanese people focus on the sales process, while Hong Kong people focus on how each marketer enters this sales system.

Later, through continuous legal regulation, the country classified similar sales activities into illegal pyramid selling and direct selling. Legal direct selling companies implemented an access system and issued licenses by relevant state departments. A company with a license is a legal company, otherwise it is an illegal company.

However, if we ask people around us or search on the Internet, we will find that even direct selling companies that are clearly legal in the country and even well-respected internationally and domestically are still controversial and even praised more than others. few. Hearing "Pin", his expression changed, and he even cursed loudly, wishing he could eat his flesh and sleep on his skin. The whole story is worth studying by practitioners.

Everything has two sides. The problem of food additives, shoddy projects, financial fraud, traffic accidents, and corruption are not problems of the industry, but are manifestations of the quality of human nature and the sound legal system that need to be improved. Many direct selling practitioners, in order to explain the advantages of direct selling compared with other industries, start by belittling companies and products in other industries; in order to prove that their company is good, they denounce the systems and models of other direct selling companies, as if the practitioners of other companies just need to change The company immediately went from dire straits to rapid growth. The importance of choice is infinitely magnified. Don’t you see, there is no free lunch in the world?

Will a legitimate direct selling company be operated as a pyramid scheme?

If practitioners blindly magnify the benefits of direct selling, companies, and products, induce people to join, and build networks, instead of focusing more on providing products and services to customers, it is not for customer satisfaction. and loyalty, focusing more on “spreading” people to build a network rather than “selling” products and providing services. What is the result of this? Without customer satisfaction and loyalty, without every household using the product and making repeated purchases, people engaged in specific work cannot make money. How can those teachers and senior executives have any income? Is there any guarantee?

Whether a country, nation, enterprise, or organization can stay together for a long time, the reason is the same. Mencius said more than 2,000 years ago, "If you gain the Tao, you will get many help, but if you lose the Tao, there will be little help." If the Tao is not there, how can we get income and security?

Look at "The Rise of Great Powers", read "History of Chinese Enterprises" (written by Wu Xiaobo), and double the history of China for thousands of years. Maybe you will have an idea of ??what direct selling you are engaged in is. Clearer understanding.

Illegal pyramid schemes will collapse. What about legal direct selling companies?

If everyone is like what was said above, even if you start to establish a large network, achieve certain performance, and have a certain income, if consumers are not satisfied, the sales staff will also be unhappy, and the sales staff will be unhappy. Performance shrank rapidly, the performance of the leaders at the higher level declined, and the leaders at the higher level also fell. Finally, the entire marketing system collapsed. There are many such examples in the history of direct selling for decades, and there is no shortage of legal direct selling company marketing teams. Example.

What is the success rate of direct selling?

Many people use the average income and churn rate of the traditional direct selling industry as an issue, which seems to have the charm of wanting to incriminate the company. Just like what Professor Lang Xianping said about "superstitious numbers", a basic concept in financial analysis is that "substance is greater than form". If you join a direct selling company and have a certain card, you are a practitioner? According to the business model of general direct selling companies, you must at least be willing to take time to learn knowledge related to the industry, company, and products, and be willing to share and promote it. This is the basic work of the direct selling industry. If the amount of learning and the amount of sharing are standardized, for example, how many hours of study are required and how many man-hours of work are required, the success rate and profit rate will be doubled several times. If we add another measure of operational methods and maturity, the number doubles again.

What are the reasons for the success of direct selling?

In fact, the possibility of problems with legitimate direct selling companies and their products is relatively small, but the direct selling model has a low threshold for intervention and high returns. What is equivalent is the emergence of entrepreneurs from a wide range of people. To put it simply, direct selling can basically be engaged in by anyone who meets the national requirements. However, from a institutional perspective, the income that can be obtained after reaching a certain turnover is higher than that of other industries. So, something very interesting happened. There are roughly the following ways to solve this problem:

1. If you have the qualities to succeed, you are already an excellent talent. As long as you transform your original abilities into abilities in the direct selling industry, you can succeed. Such people can not only be successful, but can even achieve great success in direct selling.

2. I do not have the qualities of the first type of person, but I introduced such people to engage in direct selling. From the perspective of direct sales operation model, it is also a successful way. However, relying on others to achieve success often has limitations.

3. They basically do not have the qualities to succeed, but with the help and training of the first type of people, they have the qualities to succeed.

The above three types of people can be found in direct selling companies. A healthy direct selling company is often a pyramid structure. There cannot be many people in the first type because these people have less motivation to do direct selling. There are more people in the second type, and the most people in the third type. Direct selling is a cooperative enterprise. Only when the first type of people spend time and energy cultivating the second and third types of people can the orderly development of the direct selling industry be achieved. Therefore, direct selling is education plus marketing. Marketing is not about selling goods, but about providing products and services that consumers need. Education is not about brainwashing, but about turning a person who does not have successful characteristics into a person who has successful characteristics.

What are you doing? Direct selling or MLM? Maybe my article will inspire you to understand this issue more clearly.