About MLM.How to distinguish whether the company is legal?

Network marketing - business, which some call "sects", others kvass, arguing that network marketing firm can be free to pursue a career and earn depends on the desire and needs.

Lithuania this kind of business is still not widely known or about him to form an opinion is vague. So what is it really?

Most importantly legality

Multi-level marketing (MLM) for legal firms are usually mixed with financial pyramids "or intrusive callers in (distributors) offering to purchase any item whose quality is not clear. This confusion of the most damaging to the image of network marketing because people are skeptical and not only hesitant to engage in it, but also something to buy.

Network marketing company Herbalife Lithuania leader Gitanas Brasas says that some MLM company and its products manufactured and distributed by itself, without any partners. "The companies that are just re-selling someone else's output, can be called unless the distributor who overcharge users up and sell products more expensive", - said G. Brasas.

Verslosavaite.lt almost a year ago already wrote about network marketing and article comments, a discussion has shown that people are most worried about, and the method of trading companies promote reliability.

How to distinguish whether the company is legal?

"In particular, it must be registered and employed by it, that simple and distributors have a license for that every year the State must pay taxes, - says" Tianshi Corporation spokesman Eduard Vislockis Lithuania. - Second, the company's legal operations are checked and regulated by the State Tax Inspectorate. "

G. Braso said that the company is really legally possible to check and stock exchanges, as they sell shares of the company's legal, as well as in the international MLM association, which publishes legal business and the operation of the licensed party.

production sale

"Tianshi", which belongs to the "Wellness" industry - longevity, health and beauty of the conservation area, Lithuania sells food supplements multilevel marketing method. "The company's policy is such that merchants do not go and do not offer the product on the streets or braudamiesi home, is carried out by only acquaintances", - assured E. Vislockis.

This is the same "Wellness" area depends on the company Herbalife, which, According to the head, marketing and new distributors in the business carried out by the inclusion of not only acquaintances, but also organizes various presentations, invites people to connect, but do not go into the house. "Serious network marketing system is prohibited to walk door-to-door", - said G. Brasas.

Illegal pyramid scheme

A pyramid scheme - it's illegal business model, whose main objective - money play between participating in the market without selling any product or service. Often, pyramid schemes way confused with MLM.

Pyramid scheme aims as MLM companies, to attract new members. However, the main attraction of pyramidal scheme idea was that attracted people pay a one-off "entry" fee and can then recover all of the money paid and earn nothing idle, i simply because there is a pyramid.

For example, a person receives a proposal to pay 100 euros. Payment of the right to acquire the same offer to sell to others, and part of the money goes to the original seller. In this way, the money usually goes through the circuit and the rich, only the mover of the scheme.