A “Sustainable” operation = a “Legal” operation, and if you don’t understand that simple rule then life going on from here is going to be challenging if not completely impossible.
Over the past decade or more our staff here at Strategy India and through our international offices SI Worldwide, have had cause to spend many thousands of hours reviewing direct sales /MLM/network marketing companies’ compensation plans that have been written by consultants, who with little regard for international law have been leading companies down the inevitable road of possible investigation and closure.
Compensation plan writers are continually attempting to rewrite the law book or get around the law by surrounding their unviable plans with explanatory text that even a university professor couldn't unravel. In very many cases even the CEO’s of such companies are operating blindly as they are sold floating mirror concepts that even they don’t understand taking them down the road to financial ruin.
The creators of these unviable plans are invariably past distributors who write plans to benefit the distributor with no regard for the legal obligations of the company using phrases such as “the best plan ever written”
It is generally at this point that the appointed law firm review the plan, giving it a green light based on what they have been told by the plans creator. A case of the blind leading the blind.
If this were not the case, then government bodies such as the FTC would have no issue with the direct selling industry No matter how good a plan is supposed to be there is only so much that a company can pay out in earnings.
There is only a certain % available to spend on trainings, business opportunity meetings, corporate structure, salaries, manufacturing, packaging, distribution, administration, plus all the other elements that go into running a successful operation.
Then there is of course the payment (compensation) plan to the direct sellers also known as affiliate/distributors / independent business owners/consultants, etc.
Many plans are written based on paying out on paper much more than they pay out in reality. Entice people to join with the undeliverable promise of extraordinarily high incomes safe in the knowledge that most will not reach the high income levels.
Yes, you will be told that it is an equal opportunity and everyone has the same opportunity but as with all pyramid structures that is not true.
Money that is not, or cannot be actually earned is called "breakage" in the MLM/network marketing world, a big earning area for many companies whereby monies not paid out revert to the company’s coffers.
“Avoid plans that promise breakage”
Dangling a big carrot safe in the knowledge that only small bites of the carrot will be taken is common practise and was the cause for two highly reputable companies to change tactics, one had to close down and the other had to create a newer plan.
In the construction industry they say, “Measure twice, cut once”. That same principle should apply to the direct sales industry as well. “Create the plan – Review the plan – Expert review - Launch”
So, if you are new company, or planning on becoming a new company, or maybe an existing one that wants their plan reviewed to ensure legality, compliance, and viability then Strategy India/ SI Worldwide is ready to take your call.
Create – 1st Review – 2nd Review – Launch - Protection is a far better path to travel than defence.
