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Have you ever seen disclosure statements on an MLM web site?
There are two basic reasons an MLM company has disclosure statements.
One is to dazzle and confuse you with charts and graphs into believing that they have the best program of any network marketing company on the planet.
When you see this type of disclosure and you have been around network marketing for a while then you
should be able to recognize that they are telling you that the success rate of distributors in their company is way beyond what you have ever seen before. It will appear that almost everyone who joins makes lots of money.
All they are doing is reporting partial information. The favorable part. I have had distributors from one company that believe after looking at their company’s disclosures that one our of every 30 distributors will make $10,000 per month. That of course means that you would have to make more than $300 off of each of those 30 distributors each month. Since the average distributor does not even approach $300 of personal volume each month, then that would not be possible. Companies don’t pay more than 100% back to distributors. The numbers average around 50%. And this is MLM, you don’t make all the money from everyone in your downline. Others share those profits too.
The good news is that if you do have some success with the company then it is just a matter of time till you learn that they have deceived you. What else are they willing to lie to you about?
The second reason for disclosures is companies that are required to report this info because of a court order.
