Another MLM Fairy Tale from an Industry Outsider
I've had about enough self-righteous opinions from financial-sector capitalists who, perhaps embarrassed about their own performance, insist on criticizing legitimate professions.
One such asset manager, David John Marotta, took a shot at multi-level marketing (MLM) or network marketing recently in this journal (Aug. 28 issue, column entitled, "The False Lure of Multi-Level Marketing"). And his analysis was so flawed, unsubstantiated, and preposterous that I simply couldn't let it slide. Like so many other self-appointed pseudo-experts, Mr. Marotta evidently decided to hold court outside his own domain and, in so doing, embarrassed himself and his profession.
David is probably a wonderful asset manager, but I humbly suggest that he leave multi-level marketing to the experts.
In case you missed his column, here are a few of his bits of wisdom.
"MLM is a non-sustainable business model because it simply provides a product that has been marked up in price."
Sorry David, but last year alone, as a matter of public record, Amway did $8.2 billion in sales and Mary Kay, Herbalife, and Primerica each generated in excess of $2 billion. Those are just a few examples of companies that have been extremely profitable for dozens of decades. So much for non-sustainability.
Oh, and by the way, on planet earth every product that is for sale has been "marked up in price." You see, David, that's how capitalism works. According to your bio, you do fee-only financial planning. Your fee, David, is a mark-up. Instead of anything tangible, you mark up a service that may help people or wipe them out financially. Either way you make money.
Among other things, David goes on to assert that MLM is "not really a business," "we offend our friends and families," create "no real value," and "endlessly recruit hopefuls who churn at the bottom of a pyramid," while "only those positioned at the top" collect big checks. He closes by calling our profession a "distraction from a genuine vocational calling."
Mr. Marotta offered not one shred of support for his Wikipedia-style distortions. Why? Because his ramblings lack credible research and support.
As a best selling author, I've met thousands of wonderful men and women since 1986 who, like me, joined established MLM companies at the very bottom and became wealthy through hard work and perseverance. We started with no money, special skills, or credentials and delivered superior products and services to people all over the world by word-of-mouth advertising. Many of us have earned millions over the years and given huge amounts to charities and multiple worthy causes.
My international MLM business has taken me to every continent. Unlike financial planners, we don't just sit at home and collect fees by moving money around, we build international distribution organizations that allow common people with very little capital to prosper based on their own hard work and character. Many of our products and services are far superior to the crap from overseas that people purchase from big-box superstores.
David closed with the following delusional comment, "There are hundreds of legitimate business opportunities available for entrepreneurs who want to build companies that provide real value." Sorry David, but you need to read a few books by legitimate writers. There are no options for millions of boomers who have been hammered relentlessly into horrible debt loads by unconscionable casino capitalism just in time for retirement. Others have worked diligently for decades only to have their assets "managed" into oblivion by people in your world.
Many have seen their assets converted from 401(k)s to 201(k)s by people in your profession. The only time I turned over $300,000 to an asset manager it was down the toilet in three years thanks to stupid, high-risk investments. Fortunately, I've managed the bulk of my MLM income over the years and have been comfortably semi-retired since the late 1980s.
There are good people and bad people in every profession. I'm going to assume that David is more like Warren Buffet than Bernie Madoff because ignorance is not always an indication of malice. So, David, why don't you pick up the phone and ask Mr. Buffet why he calls MLM a great field. Better yet, ask him why he owns The Pampered Chef. He might be able to teach you why so many experienced asset managers regard MLM with respect. - Mark B. Yarnell
**Don't ever let someone steal your dream or make you feel the network marketing profession is not a legitimate profession. When I read stuff like this, I realize how fortunate we are to be in this Agel business.
-Gary Hasson
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