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Multi-level marketing (MLM) is a business model in which individuals are recruited to become distributors of a product or service and earn income through both their own sales and the sales of the distributors they recruit. MLM companies typically have a hierarchical structure, with distributors at different levels earning commissions and bonuses based on their own sales and the sales of their downline.
MLM often involves a direct selling approach, where distributors sell products or services directly to consumers through personal relationships and word-of-mouth marketing. Distributors are encouraged to recruit others to join the company as distributors themselves, creating a downline of representatives who can generate additional sales and income.
Critics of MLM argue that the business model often relies heavily on recruiting new distributors rather than selling quality products. This can lead to a focus on recruitment and building a large downline, rather than on selling products to actual consumers. Others argue that MLM can create opportunities for individuals to build their own businesses and generate income through hard work and effort.
It is important to thoroughly research and evaluate any MLM opportunity before getting involved, as not all companies operate ethically or provide a viable income opportunity.