HBIZNEWS

You already know that you shouldn’t make a decision about a home business opportunity until you’ve done some homework.

The problem is, if you’re like me, you just don’t want to take the time to do it or, (like many others), you simply don’t know how or what to look for.

What you need is a shortcut.

A “rule of thumb” method to help you decide if you are looking at a legitimate business or a pyramid/pozi scheme.

And here it is!

1. When you saw the presentation, was more time spent talking about the product or about recruiting and building a business?
2. When the speaker talks about the ‘life changing’ amount of money that can be made, can it be done by selling product at retail or do you have to build an army to realize the promised income?

I know, it’s not all as clear as you’d like it to be is it?

Talk of distributors simply using their own products, (a ‘buyers club’ type model), is a powerful argument and in fairness to that point of view, the legal definitions that govern this activity are completely unclear.

Here lies most of the problems with the direct sales and network marketing industries today.

This gray area in the laws surrounding network marketing and direct selling makes it possible, (and popular), to construct an illegal pyramid scheme and disguise it as a legitimate direct sales business.

How is it disguised you ask?

Most often this disguise is in the form of “self use”. Meaning that you just need to purchase and use the product yourself, (as a distributor / consumer), then encourage others to become distributors and do the same thing.

Until the courts draw a clear line about the “self use” issue,

There is only one realistic method that will guide you in your decision.

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The Wal-Mart Test!

• If you found the same product on the shelf at Wal-Mart at the same price, would you buy it?

Honestly! Without the influence of the business opportunity, would you spend your hard earned money to buy the product you will be selling?

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If you can honestly answer yes to that question then you are very likely looking at a good business opportunity!

Why? Because, if you would buy it off the shelf, others would as well. It means that there is a market for that product at the price you will be paying.

There is a notable exception!

The product in question must have some “intrinsic” value. In other words if the product or service is available “for free”, all bets are off!

If you’re looking at a business in which you don’t have to sell anything but instead you “give the product away”, turn around and walk away right now!

You’ve found a Ponzi Scheme.

What is a “Ponzi Scheme”?

A “Ponzi” or “Pyramid Scheme” is a simple concept but can be difficult to explain and even more difficult to recognize.

The best example of this type of scheme is described in the example, “Peter Ponzi and the Amazing Pencil”.  This short story demonstrates why these kinds of activities are so attractive and the twisted logic that keeps them alive.

CLICK HERE

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