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What is multi-level marketing (MLM)?

Multi-level marketing (MLM) is a method of selling products directly to consumers using independent sales representatives.

How does MLM work?

Under the MLM model, distributors are not employees of the company. Instead, they’re individual business owners who recruit their own distributor networks to help them sell products. Multi-level marketing firms rely upon this extended network of independent distributors to generate revenue. To understand how MLM works, think of a pyramid.

Who is a distributor in a MLM?

All distributors in the hierarchy above a member's sponsor. The chain of command runs up to the Head of Sales. Upline distributors receive income on sales made by downline partners. The MLM is a legal marketing technique that aims to expand the market for its products and services.

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