I hear more and more from companies wanting to enter the Chinese market. Companies see the vast population and look at China as a new frontier. Unfortunately for the multi-level marketer, that frontier is mostly closed. China as a general rule is not multi-level marketing friendly.
I receive many calls weekly from people wanting to start up a new MLM company. They come with the typical claims of how they are different from everyone else, and that they will be the greatest and biggest MLM company of all time.
Every state has a law or several laws dealing with the topics of unfair and deceptive trade practices. In addition to the states, the Federal government has also enacted statutes that prevent unfair and deceptive trade practices.
How to tell the difference between a legitimate multi-level marketing/network marketing company and an illegal pyramid scheme
Let me begin this discussion with an evaluation of the two entities with comparisons and contrasts as approached from the standpoint of a consumer and then follow it up with a discussion of how a company can prevent itself from falling into the pyramid scheme trap.