A

SUMMER TRAINING PROJECT REPORT

ON

Network Marketing & Development

For the partial fulfillment of the requirement

For the award of the degree of

BACHELOR OF BUSINESS ADMINISTRATION

SUBMITTED TO: SUBMITTED BY:

Shweta Kulshreshta Name: Rajiv Kumar
MIMT Roll No.1599209559
Greater Noida

MANGALMAY INSTITUTE OF MANAGEMENT &

TECHNOLOGY
GREATER NOIDA (U.P.)

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 Mangalmay Institute of Management & Technology
AN INSTITUTION OF MANGALMAY FOUNDATION TRUST
Campus: 8 & 9, Knowledge Park – II, Greater Noida (U.P.) Ph: 0120-2320400, 2320401, 2320680
Institution Office : C – 116, Sector – 39, Noida – 201301 (U.P) Ph: 0120-2500381, 2572237, 2570428
e-mail: info@mangalmay.org, Visit us at: www.mangalmay.org

CERTIFICATE

This is to certify that Mr.Rajiv kumar University Roll No.1599209559 is a regular student
of BBA final year full time degree course at our institute. His / Her Summer Training Project
work entitled “Network Marketing & Development at eBIZ.com pvt.ltd. Noida Delhi
NCR” submitted as a part of the curriculum for the award of Bachelor of Business
Administration degree of C.C.S University, at Mangalmay Institute of Management and
Technology, Greater Noida is an original work conducted by him/her.
This work has not been submitted earlier in part or full to this or any other
Institute/University for any degree or diploma.

Dr. Amit Gupta

Head of Department

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 Mangalmay Institute of Management & Technology
AN INSTITUTION OF MANGALMAY FOUNDATION TRUST
Campus: 8 & 9, Knowledge Park – II, Greater Noida (U.P.) Ph: 0120-2320400, 2320401, 2320680
Institution Office : C – 116, Sector – 39, Noida – 201301 (U.P) Ph: 0120-2500381, 2572237, 2570428
e-mail: info@mangalmay.org, Visit us at: www.mangalmay.org

C.C.S University, Meerut

Sample of Student Declaration

Student Declaration

I, Rajiv kumar, bearing University Roll No.:1599209559 of C.C.S University, Meerut,

enrolled as student of BBA at Mangalmay Institute of Management & Technology, Greater
Noida, solemnly declare that the project report titled, ‘Network Marketing and
Development’ embodies the results of original research work carried out by me and the same
has not been submitted in any form partially or fully for award of any diploma or degree of
this or any other University/Institute.

(Rajiv Kumar)
Roll No.:1599209559

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Sr.No Topic Page no.

Chapter –I
01 About the Company Profile 06

Chapter –II
02 12
Founder of Company Profile
Chapter –III
03 16
Product & Services
Chapter –IV
04 22
Career in Origination
Chapter –V
05 26
About The Network Marketing
Chapter –VI
06 38
Business Model

Chapter –VII
07 59
Development in Network Marketing

Chapter –VIII
08 63
Scope & Future
Chapter –IX
09 73
Frequently Ask Questions

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 CHAPTER - I

INTRODUCTION

ABOUT THE COMPANY PROFILE

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About eBIZ.Com

eBIZ.COM PVT. LTD. Is an organization which is running for the past Seventeen
years promoting Education and a unique business concept? Many people found eBIZ
responsible for transforming their lives and taking them out of meritocracy. It helps us
to change our thinking, behavior and our habits by simply changing our environment
with the people who are doing something great in life. These people work day and
night for what they want in life and do not go with the flow of what other people are
doing. They have their own dreams, positive attitude towards life and they guide for
the same to other people. Therefore, they are known as leaders. There are many
leaders in eBIZ who quide people as how to reach the goal they are aiming at.
eBIZ.com provides unique and revolutionary model allows you to Learn and Grow. Since
time immemorial, mankind has acquired knowledge and has been able to put it to
constructive use, to earn one's livelihood.

eBIZ.com presents an opportunity that will not only quench your thirst for knowledge but
will bring you face to face with the vast powerhouse of information and opportunity, besides
presenting you an opportunity to develop / grow and achieve financial growth.

eBIZ.com would require that its Representatives acquire some basic fundamental computer
knowledge, test themselves online and be certified, developing selling skills and sell its
various packages / products / services, to rise to higher levels of achievement. In subsequent
years, eBIZ would ensure that Representatives are imparted fundamental education and
empower their appearance further and continue to enjoy the benefits of the organization and
upliftment. This is an indication of our commitment to the cause of education to the masses.

Representatives Nationwide will celebrate as the day this revolutionary company was born, to
deliver them essential Computer Education, the opportunity to buy / sell the useful products /
services and the financial growth to those who intend to acquire it. eBIZ.com Pvt. Ltd.
(ISO 9001:2008 Certified) was incorporated on 8th June 2001 vide certificate of
Incorporation No U72200DL2001PTC111183 under the Companies Act, 1956 (No-1 of
1956).

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Successful Educationist, Marketing Leader and Guru, who has achieved phenomenal success
in the field, with rich experience of many years, have been instrumental in making this
opportunity a reality. This leader has already helped thousands of families around the world,
to realize their dreams. The sheer grit and determination of this leader, to make the country a
better place to live in, is the driving force behind the venture. Education and sale of useful
product for the masses will be the chariot, on which prosperity will ride and arrive.

MISSION OF THE COMPANY

The mandate for the company is to make many of the deserving and deprived people of the
world computer literate, to provide a means of good quality of life for thousands of willing
eBIZ Retailers / Representatives through our computer program of Learning and Selling our
useful products / services.

To educate people of all ages, in the use of computers and help them to buy and sell our
useful products / services and help others to do the same.

eBIZ Education
eBIZ.com is your key to harnessing the power of the Internet. This Unique and Revolutionary
model allows you to Learn and Grow. We are on the mission to Educate the masses.
eBIZ.com presents an opportunity that will not only quench your thirst for Knowledge and
Education, but will bring you face to face with the vast powerhouse of Information and
Opportunity. At http://education.ebizel.com you will find all major Computer Courses from
Computer Fundamentals to Latest Technologies.

Apart from this you can Learn and know various Languages and lots of other Utilities like
Fire fighting etc. Here you can Learn Computer Courses and various other topics in a very
handy and accessible format. Since, we are in the process of imparting continuous Computer
Education even to the people who have somehow been deprived of acquiring it, so we keep
modifying and adding new Courses all the time. Good luck to you all.

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 VISION OF THE COMPANY

To become the best Company of the World by touching

millions of people around the globe, by providing essential
Computer education, quality products and services at very
reasonable and affordable costs, to help them achieve
financial growth.

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Let's demystify the web. There has been so much of hype and
media attention on
dot-com businesses that the real driving force behind the
internet revolution has
been forgotten.

In a bid to generate high valuations, unrealistic business plans and revenue models were
rushed through, and it required the bubble to burst to bring everyone down from cloud nine.
Behind the buzzwords and hype of e-commerce, B2B, B2C was the undeniable fact - the
internet has always been a powerhouse of information, the sum total of information that is
available to mankind.

The information super highway is here to stay. Dot Com's may become Dot Gone's. But
viable business models, sound business proposals with dedicated management and workforce
to implement them, will never fail.

It's time now to reconsolidate and align with the winners, and then ride the wave, as it starts
to rise again.

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 The opportunity that eBIZ.com Pvt. Ltd.
is bringing forth is with this aim in mind.
You would join a unique program that would:

Give you access to online education and course material prepared by experts,
presented in a graphical, easy to learn format.

Enable you to test yourself and earn online certificates

.

Provides opportunity to spread awareness toward education to the masses.

Gives you an opportunity to buy the unique products / packages for your use or
sell further.

Gives you a chance to become self-employed and earn significantly.

Provides you platform for continuous learning and growing by way of

developing the required skills.

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 CHAPTER - II

About The

Founder
and
Managing Director
eBIZ.Com Pvt.Ltd.

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Dr.Pawan Malhan
Dr. Pawan Malhan is an educationalist. He taught many great
personalities who played a big role for this country. He completed his
M.Sc. And Ph.D. in mathematics from IIT Delhi, Asia’s one of the most
reputed department in mathematics. He then worked with many
government agencies like AIU- Association of Indian Universities
etc.

Journey Through Network Marketing Industry

In 1996, he was called upon UBC- University of British Columbia for
the purpose of guest lectures. While giving lectures and having
interaction with students he observed something strange. He observed
that students were earning a large amount of income in their part time which was
surprisingly 3-4 times more than his own income. Obviously, he tend to know what is it
all about and what is it. That was an introduction for Dr. Malhan of network marketing.
He found the concept fascinating and started working in that industry. In few years he
declared himself one of the fastest millionaire of North America.

He then observed that people are doing something big with human resource in this
industry. As he belongs to India, he thought the biggest resource for this industry is
there in India i.e. human resource.

As he was a patriotic person and a social reformer, he developed a vision for Indian
youths and to raise Indian economy with this industry. Moreover, there will be more
number of people who are earning good, unemployment will decrease and as a result
there will be a major roll of this industry to raise Indian economy. With this mission he
came India and gave a rise to eBiz.com Private Limited in 2001. With this company he
started to develop Indian youths by providing various IT solutions like computer
courses, developing various skills like presentation skills, communication skills,
confidence enhancement etc.

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 Important point about Dr.Pawan Malhan

CAREERS HIGHLIGHTS

Deputy Director of Association of Indian Universities and lectured in various Universities all
over India on reforms in Higher Education.

HIS CONTRIBUTION

Dr. Pawan Malhan is a well known educationist and philanthropist. Dr. Pawan Malhan is also
part of various other social activities in and around India through his organisation,
eBIZ.COM Pvt. Ltd.

HIS VISION

Financial Freedom
of youth and to create a corruption free environment.

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Whats is eBIZ? According to Founder (Dr.Pawan Malhan)

In a globalized environment where economic reform is of vital importance, eBIZ is

completely dedicated to transform the mind-set of the masses in general, and youth in
particular by infusing sense of economic independence and self-reliance. Bestowed with a
noble mission of bringing social, educational and economic reforms, eBIZ is committed to
create awareness among the masses and driving them towards productivity through
Innovation and entrepreneurship. Inculcating entrepreneur skills among the youth and
channelizing youth energy for confronting the national and international challenges, making
them realize the national and global needs are some of the prime objectives on which eBIZ
has been constantly focusing upon. By introducing several packages and various other
products with reasonable cost eBIZ has made an endeavour to create computer literacy
among the masses and also has created self – employment opportunity for youth of our
Nation. With its Representatives spread throughout various states in the country eBIZ has
taken computer education and its various other products along with the self-employment
opportunity to the doorstep of the masses who are otherwise deprived of such opportunities.
Considering the future needs, eBIZ has taken initiative in popularizing the computer
education by providing easy access and simplifying the process of acquiring computer
literacy through its online self-learning packages. In order to reduce the burden on the users,
a philanthropic approach has been adopted to provide the packages in a reasonably minimum
cost. For overcoming the language barrier, some of the fundamental courses have also been
developed in different regional languages. While designing the online self-learning packages,
utmost care has been taken to avoid the stereotyped methods of learning and it has been
ensured that the learning becomes joyful. Also understanding the existing need of our
employment various products have been identified to be sold at reasonable cost and hence
created a great Business opportunity for the one who want to attain it.

In a nutshell, eBIZ has opened a new vista in the direction of educational and economic
empowerment by making them responsible future citizens with a greater sense of
responsibility, preparing them to face the formidable national and international challenges
and harnessing than potential for achieving the greater goal of economic self-reliance in a
sustainable manner.

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 CHAPTER - III

Information

Products and Service

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eBIZ Package eBIZ Retailer

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 eBIZ Package
eBIZ Elite Appearance Package I

Description
A perfect combo of the evergreen Black Plain Suitlength and trendy Checkered Suitlength in
lightweight polyviscose for eBIZ Agamya's Elite Men's Unstitched collection. The enduring ,
smooth finish fabric is ideal for both kinds of fit - regular and slim. The design conveys
practicality and calmness . Dress up for a formal evening or a business meeting in this dapper
look.

eBIZ Elite Appearance Package II

Description
Suit up for a formal meeting or an evening out with this creatively crafted combo of Plain
Navy Blue Suitlength and trendy Checkered Suitlength in lightweight polyviscose for eBIZ

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Agamya's Elite Men's Unstitched collection. The enduring , smooth finish fabric is ideal for
both kinds of fit - regular and slim. The design conveys firmness and style.

eBIZ Elite Appearance Package III

Description
Dark Blue suitlength for the formal evenings and Khaki suitlengths for the day outings in
lightweight polyviscose in a combo package for eBIZ Agamya's Elite Men's Unstitched
collection. The enduring , smooth finish fabric is ideal for both kinds of fit - regular and slim.
The design conveys newness and finesse.
Material Care: Dry clean only

Advance eBIZ Educational Package

Description
Contains Basic as well as some Intermediate and Advance computer courses. In addition,

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 eBIZ also provides various language learning, utilities, day to day use of softwares and other
resources which give understanding on various aspects of life. There is a great optional
Business Plan along with this package, if you prefer to sell this package to others.

Consists of the following:

1. Computer courses

Operating System Database

 Inside Operating System  Microsoft Access

 Windows 98  PL SQL
 Windows XP  MySQL
 DOS  MySQL 5.6
 Inside BIOS  Sql Server 2014
 Windows Vista  Oracle 12c
 Linux
Designing
 Windows 8.1

 Flash
Programming Language
 Page Maker
 Visual Basic  CorelDraw
 C  Illustrator
 C++  Microsoft Publisher
 Fortran  Macromedia Flash 8
 Core Java  Adobe InDesign
 JDBC  Flash CS6
 Advance C  Photoshop CS6
 Data Structure through C
Scripting Language
 C#
 ASP.NET 2.0
 HTML
 ADO.NET
 JavaScript
 AutoCAD
 Java Server Page
 ASP.NET 4.5
 HTML DOM
 AutoCAD 2015
 DHTML

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 CSS  MS PowerPoint
 XML  MS Front Page
 XHTML  Computer Hardware
 DTD  Tally 5.4
 RSS  Tally 8.1
 XSL  Computer Fundamental
 XML Schema  Networking
 WAP WML  TCP IP
 PHP  MS Paint
 VBScript  UML
 AJAX  Computer System Architecture
 JQuery  Software Testing
 Working With PHP  Word 2007
 PHP 5.6  Excel 2007
 HTML 5  PowerPoint 2007
 Word 2013
Miscellaneous
 Excel 2013
 PowerPoint 2013
 MS Word
 Digital Marketing
 Internet
 MS Excel

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 CHAPTER - IV

Career in eBIZ.com

Why should join eBIZ

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Why Should join eBIZ?

You’re not the only one! Many people who are taking a new step are nervous. Well,
joining eBIZ and giving your few hours a day can affect your life in many ways in the
longer run.

eBIZ is an organisation with the aim of earn and learn. It’s learning process involves
teaching and training a person for developing skills such as

 Presentation Skills
 Financial Skills
 Selling Skills
 Public Speaking Skills
 Communication Skills
 Risk Taking Ability
 Management of
People
Time
Money
 Moral Literacy
 Art of Living
eBIZ’s earning part is based on its business model which comes under direct selling.
Direct selling is a huge industry worldwide recognized by many great leaders. If you’re
willing to invest your spare time over something which will grow with time with your
efforts then eBIZ is for you. It’s like planting a tree. In starting phase you bow a seed,
give water and take care of its essentials. Over the period of time, it grows in something
very big which gives you fruits and unlimited shelter. Similarly, if you start eBIZ and
take care of your business by putting efforts consistently, over the period over time your
business will grow into something very big giving you results throughout your life. It is
your choice do you have to bow your seed or not.

Can you Become different from the normal crowd?

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Yes, you can. 90% of the people are not happy with what they are doing. But if you
want to be in that 10%, you have to have to do what the 10% people are doing. Let’s
talk about 90% people first

A RAT RACE-

We are all living like a rat who is in a race

 We are forced to get good marks in school no matter in which standard we are
 We are then forced to get good marks for entrance to get in a good college
 We are then told to do a good job that would pay home bills so that we can help and
contribute to the family income
 Afterward, we are asked to work hard to get increment and increase our pay and earn
more to get financially satble
 At some age where we think we are somewhere, we think of buying a home for
future use, due to which we get caught in a home loan for next 10 years
 Then we have got a family to take care of and spending time and money for their
well being
 At last, Retirement

Did you see read that carefully? will that be your life? You doubt! But yet, 90% people
in the world live that life. This is a loop in which we, or parents, our grandparents and
even our kids will be caught in. It’s time to change

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If you need to be something different and achieve something what you feel, what you
desire and do not want to work for someone else’s desire then you have to do something
that other people are not.

“Direct selling has made the most millionaires than any other industry in the world”
Here is what you need to see at what great leaders say about direct selling or Network
Marketing

eBIZ can be the most beautiful thing that can happen to you if you seriously follow
simple steps as guided by the people who have already done it. Contact your nearest
friend doing ebiz today and have an insight as how things work.

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 CHAPTER - V

About The

Network Marketing
As know Direct Selling & MLM

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What is Direct Selling and Network Marketing?
The direct selling industry in India is one of the fastest growing non-store retail formats,
recording double digit growth of more than 16 per cent over the past four years. Direct
selling industry in India has the potential to reach a size of INR 645 bill ion by 2025.
Within the Direct Selling model there is a network marketing model however that is
very different from the pyramid schemes that the Government needs to protect
consumers against. (These pyramid or Ponzy schemes involve promises of abnormal
returns/benifits) To contrast, the Direct Selling model even if it is in the Network
Marketing mode is about sales of goods and sometimes services. There has to be an
explicit qualification explaining that direct selling is not to be interpreted as a money
circulation scheme. A pyramid scheme has to be defined, so that one knows what is
being prohibited.

Network marketing is a type of business opportunity that is very popular with people
looking for part-time, flexible businesses.

Along the way, it has positively contributed to several social and economical
parameters. There is a major contribution of Direct Selling in various Schemes like
‘Make in India’, ‘Skill India’, ‘Digital India’, ‘Start-Up India’, ‘Women
Empowerment’.

It is obvious that direct selling and Network Marketing are forms of economic activity
that could play a very important role in a country like India. These are low transaction
cost mechanisms for sales that have a very high value added component, and are not
very resource intensive unlike other forms of sales and marketing. Direct Selling and
Network Marketing therefore allow firms, small and large to use business models that
preclude the need for building large physical retail infrastructure. It is also obvious, that
a competitive economy needs to allow various options of sales and marketing, as it
needs to allow various options for investment and production.

What benefits you can get through Network Marketing?

 Low Cost of Entry

 Your Own Schedule
 Tax Benefits for Home
 Work From Anywhere
 Friendships
 No Employees
 Residual Income
 Paid For Vacations & Paid While You Vacation
 Security
 No One Can Tell You What You Are Worth
 No Income Ceiling
 Builds Social Skills
 Allows You To Help Others On A Massive Scale
 You Can Go From Nothing To Something In A Short Time
 Your Personal Growth
 No Discrimination Between Men & Women
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 Support, Help & Encouragement of Others In The Profession
 You Are Your Only Limit
 No Corporate Ladder
 Leverage Time / Network
 Training Readily
 International Possibilities
 No Billing / Accounts Receivables
 You Are Building Your Own Dream

Network marketing is a type of business opportunity that is very popular with

people looking for part-time, flexible businesses. Some of the best-known
companies in America, including Avon, Mary Kay Cosmetics and Tupperware,
fall under the network marketing umbrella.

Network marketing programs feature a low upfront investment--usually only a

few hundred dollars for the purchase of a product sample kit--and the
opportunity to sell a product line directly to friend, family and other personal
contacts. Most network marketing programs also ask participants to recruit
other sales representatives. The recruits constitute a rep's "downline," and their
sales generate income for those above them in the program.

Things can get sticky when a network marketing network compensates

participants primarily for recruiting others rather than for selling the company's
products or services. A network marketing system in which most of the revenue
comes from recruitment may be considered an illegal pyramid scheme.

Since network marketing programs are usually exempt from business

opportunity regulation and aren't defined as franchises under state and federal
franchise laws, you'll need to do your own investigation before investing any
money.

Multi-level marketing (MLM) also called pyramid selling, network

marketing and referral marketing, is a marketing strategy for the sale of
products or services where the revenue of the MLM company is derived from a
non-salaried workforce selling the company's products/services, while the
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earnings of the participants are derived from a pyramid-
shaped commission system.

Although each MLM company dictates its own specific "compensation plan"
for the payout of any earnings to their respective participants, the common
feature which is found across all MLMs is that the compensation plans
theoretically pay out to participants only from the two potential revenue
streams. The first stream of compensation can be paid out from commissions of
sales made by the participants directly to their own retail customers. The second
stream of compensation can be paid out from commissions based on the sales
made by other distributors below the participant who had recruited those other
participants into the MLM; in the organizational hierarchy of MLMs, these
participants are referred to as one's “down line” distributors.[5]

MLM salespeople are, therefore, expected to sell products directly to end-user

retail consumers by means of relationship referrals and word of
mouth marketing, but most importantly they are incentivized to recruit others to
join the company as fellow salespeople so that these can become their down
line distributors.[3][6][7] According to a report that studied the business models of
350 MLMs, published on the Federal Trade Commission’s website, at least 99%
of people who join MLM companies lose money.[8][9] Nonetheless, MLMs
function because downline participants are encouraged to hold onto the belief
that they can achieve large returns, while the statistical improbability of this is
de-emphasised. MLMs have been made illegal in some jurisdictions as a mere
variation of the traditional pyramid scheme, including in mainland China

Revenue streams

In the MLM business model, the commission derived from the MLM's pyramid-
shaped structure (i.e. from the sales of one's recruits) is the most profitable
revenue stream. This revenue stream, however, is also the least statistically
probable source of remuneration to a salesperson. Conversely, the revenue

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stream from direct-sales of ones own personal sales is the least profitable. This
revenue stream, however, is also statistically the most likely source of
remuneration to salespeople. For the overwhelming majority of participants,
however, neither one of these two revenue streams will be profitable after
operating expenses are deducted.

Participant profits and losses[edit]

The overwhelming majority of MLM participants (most sources estimated to be

over 99.25% of all MLM participants) participate at either an insignificant or nil
net profit.[12] Indeed, the largest proportion of participants must operate at a net
loss (after expenses are deducted) so that the few individuals in the uppermost
level of the MLM pyramid can derive their significant earnings—earnings
which are then emphasized by the MLM company to all other participants to
encourage their continued participation at a continuing financial loss.

Participant consumerism[edit]

Consumers of an MLM company's products/services can, in theory, be merely

end-user retail consumers. End-user retail consumers are non-participants of the
MLM company, with their relationship to the MLM company being nothing
more than in a capacity of consumers. In actual practice, however, the
overwhelmingly majority of consumers of MLM products/services are the
participants. They are the very "salespeople" within the MLM who had been
recruited by a fellow participant positioned above them in the MLM pyramid
structure.

Revenue and total profit of the MLM company is thus largely generated from
the pockets of participants within the MLM pyramid who are simultaneously
both salespersons and consumers at once. Only an insignificantly small
proportion of revenue and total profit is derived from non-participant retail
consumers who are outside of the MLM participant pyramid. Many MLM
companies will not disclose what percentage of its consumers are
Page | 29
simultaneously their own participants. Other MLMs do not keep said figures
because they do not differentiate between participant consumerism versus non-
participant retail consumerism.

Distribution of profit to participants

It is important to distinguish between the MLM company itself versus the so-
called "independent businesses" run by the MLM participants. Many MLM
companies generate billions of dollars in annual revenue and hundreds of
millions of dollars in annual profit, however, an MLM company's overall
profitability does not correlate to the profitability experience of their
participants.

The percentage of an MLM company's total profit that is ultimately distributed

to its participants (the sales force), away from the MLM owners or shareholders,
differs from one MLM company to the next. However, the percentage
earmarked to be paid to participants is usually a quite smaller share of overall
company profits. The earmarked figure is then distributed in complex
compensation plans which, ultimately, funnel most of it to a few individual
participants in the upper-most levels of the MLM participant pyramid. The
remaining majority of participants (often over 99.5% or more) receive no
returns, or negligible return which are more often than not at a net loss after
they deduct expenses which were incurred in the promotion of their
"independent businesses".

Participant movement

While participants' movement up the pyramid of an MLM can be accomplished

in theory, and indeed this is one of the distinguishing factors between MLMs
and traditional pyramid schemes (besides featuring actual sales of products or
services), said upward movement is so extremely improbable as to render it
practically impossible, despite all efforts and investments of time and money by
a participant.
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Participant financial loss, company financial gain

The end result of the MLM business model is, therefore, one of a company (the
MLM company) selling its products/services through a non-salaried workforce
("partners") working for the MLM company on a commission-only basis while
the partners simultaneously constitute the overwhelming majority of the very
consumers of the MLM company's products/service that they, as participants of
the MLM, are selling to each other in the hope of one day themselves being at
the top of the pyramid. This creates great profit for the MLM company's actual
owners and shareholders.[citation needed]

As noted, many MLM companies do generate billions of dollars in annual

revenue and hundreds of millions of dollars in annual profit. However, the
profits of the MLM company are derived to the detriment of the overwhelming
majority of the company's non-salaried workforce (the MLM participants). Only
some of the profit is then significantly shared with none but a few individual
participants at the top of the MLM participant pyramid. The earnings of those
top few participants then allows the creation of an illusion of how one can
potentially become financially successful if one becomes a participant in the
MLM. This is then emphasized and advertised by the MLM company to recruit
more participants to participate in the MLM with a false anticipation of earning
margins which are in reality merely theoretical and statistically improbable.[13]

Although an MLM company holds out those few top individual participants as
evidence of how participation in the MLM could lead to success, the reality is
that the MLM business model depends on the failure of the overwhelming
majority of all other participants, through the injecting of money from their own
pockets, so that it can become the revenue and profit of the MLM company, of
which the MLM company shares only a small proportion of it to a few
individuals at the very top of the MLM participant pyramid. Participants, other
than the few individuals at the top, provide nothing more than their own

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financial loss for the company's own profit and the profit of the top few
individual participants.[14]

Financial independence

The main sales pitch of MLM companies to their participants and prospective
participants is not the MLM company's products or services. The
products/services are largely peripheral to the MLM model. Rather, the true
sales pitch and emphasis is on a confidence given to participants of potential
financial independence through participation in the MLM.[15] This is referred to
as "selling the dream".[16]

Though emphasis is always made on the potential of success and the positive
life change that "might" or "could" (not "will" or "can") result, it is only in
otherwise difficult to find disclosure statements (or at the very least, difficult to
read and interpret disclosure statements), that MLM participants are given fine
print disclaimers that they as participants should not rely on the earning results
of other participants in the highest levels of the MLM participant pyramid as an
indication of what they should expect to earn. MLMs very rarely emphasize the
extreme likelihood of failure, or the extreme likelihood of financial loss, from
participation in MLM. MLMs are also seldom forthcoming about the fact that
any significant success of the few individuals at the top of the MLM participant
pyramid is in fact dependant on the continued financial loss and failure of all
other participants below them in the MLM pyramid.

Differences and similarities to pyramid schemes

MLMs have been made illegal in some jurisdictions as a mere variation of the
traditional pyramid scheme, including in mainland China.[10][11] In jurisdictions
where MLMs have not been made illegal, many illegal pyramid schemes
attempt to present themselves as MLM businesses.[7] Given that the
overwhelming majority of MLM participants cannot realistically make a net
profit, let alone a significant net profit, but instead overwhelmingly operate at
Page | 32
net losses, some sources have defined all MLMs as a type of pyramid scheme,
even if they have not been made illegal like traditional pyramid schemes
through legislative statutes.

MLMs are designed to make profit for the owners/shareholders of the company,
and a few individual participants at the top levels of the MLM pyramid of
participants. According to the U.S. Federal Trade Commission (FTC), some
MLM companies already constitute illegal pyramid schemes even by the
narrower existing legislation, exploiting members of the organization.[19] There
have been calls in various countries to broaden existing anti-pyramid scheme
legislation to include MLMs, or to enact specific anti-MLM legislation to make
all MLMs illegal in parallel to pyramid schemes, as has already been done in
some jurisdictions.[citation needed]

The legal distinction between MLMs and traditional pyramid schemes has been
characterized by many authorities as a legal fiction. Jurisdictions that retain a
legal distinction between MLM pyramid businesses versus illegal pyramid
schemes retain said distinction on two key distinguishing features: 1) that
MLMs always encompass the sale of actual products/services, while traditional
illegal pyramid schemes ordinarily do not (though sometimes they do), and 2)
that climbing an MLM pyramid is overwhelmingly statistically improbable
(especially to its highest participant levels) but not theoretically impossible,
whereas climbing a traditional illegal pyramid scheme is both statistically and
theoretically impossible

Employment law

MLM salespeople are not employees of the MLM company. Participants do not
derive a salary/wage, nor do participants receive remuneration from the MLM
company for their invested labor and expenses in their MLM "independent
business". The income of participants, if any income is made at all, is derived

Page | 33
only from commissions on their personal sales or their share of the commissions
on the personal sales of their downlines (the MLM compensation structure).

As non-employees, participants are not protected by legal rights of employment

law provisions. Instead, salespeople are typically presented by the MLM
company as "independent contractors" or "independent business owners".
However, participants do not possess a business in the traditional legal sense, as
the participants do not hold any tangible business assets or intangible
business goodwill able to be sold or purchased in a sale or acquisition of a
business. These are the property of the MLM Company.

Lawsuits

Companies that use the MLM business model have been a frequent subject of
criticism and lawsuits. Legal claims against MLMs have included, among other
things:

 their similarity to traditional illegal pyramid schemes

 price fixing of products or services,
 collusion and racketeering in backroom deals where secret compensation
packages are created between the MLM company and a few individual
participants, to the detriment of others
 high initial entry costs (for marketing kit and first products),
 emphasis on recruitment of others over actual sales (especially sales to non-
participants)
 encouraging if not requiring members to purchase and use the company's
products,
 exploitation of personal relationships as both sales and recruiting targets,
 complex and exaggerated compensation schemes,
 false product claims

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 the company or leading distributors making major money off participant-
attended conventions, training events and materials, advertising materials,
and
 cult-like techniques which some groups use to enhance their members'
enthusiasm and devotion.
Direct selling versus network marketing
"Network marketing" and "multi-level marketing" (MLM) have been described
by author Dominique Xardel as being synonymous, with it being a type of direct
selling.[6]Some sources emphasize that multi-level marketing is merely one form
of direct selling, rather than being direct selling.[21][22] Other terms that are
sometimes used to describe multi-level marketing include "word-of-mouth
marketing", "interactive distribution", and "relationship marketing". Critics have
argued that the use of these and other different terms and "buzzwords" is an
effort to distinguish multi-level marketing from illegal Ponzi schemes, chain
letters, and consumer fraud scams.[23]

The Direct Selling Association (DSA), a lobbying group for the MLM industry,
reported that in 1990 only 25% of DSA members used the MLM business
model. By 1999, this had grown to 77.3%.[24] By 2009, 94.2% of DSA members
were using MLM, accounting for 99.6% of sellers, and 97.1% of
sales.] Companies such as Avon, Electrolux, Tupperware,[26] and Kirby were all
originally single-level marketing companies, using that traditional and
uncontroversial direct selling business model (distinct from MLM) to sell their
goods. However, they later introduced multi-level compensation plans,
becoming MLMs.[21] The DSA has approximately 200 members[27] while it is
estimated there are over 1,000 firms using multi-level marketing in the United
States alone.[28]

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History
The origin of multi-level marketing is often disputed; but multi-level marketing
style businesses existed in the 1920s,[29] 1930s California Vitamin
Company,[30] (later named Nutrilite) or California Perfume Company (renamed
as "Avon Products").[31]

Setup
A typical Multi-level marketing MLM binary tree structure. The blue individual
will receive compensation from the sales of the downline red members.

Independent non-salaried participants, referred to as distributors (variously

called "associates", "independent business owners", "independent agents", etc.),
are authorized to distribute the company's products or services. They are
awarded their own immediate retail profit from customers plus commission
from the company, not downlines, through a multi-level marketing
compensation plan, which is based upon the volume of products sold through
their own sales efforts as well as that of their downline organization.

Independent distributors develop their organizations by either building an active

consumer network, who buy direct from the company, or by recruiting
a downline of independent distributors who also build a consumer network base,
thereby expanding the overall organization.

The combined number of recruits from these cycles are the sales force which is
referred to as the salesperson's "down line". This "down line" is the pyramid in
MLM's multiple level structure of compensation.[6]

Assuming the blue individual recruits five, and those five recruit their own five,
and so on, the maximum theoretical cycles of recruits possible in the "down
line" of the blue individual is 14 cycles (514 = 6.1 billion people), after which
point the total human population is exceeded.

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 CHAPTER - VI

BUSINESS MODEL
NETWORK MARKETING

Page | 37
MULTI LEVEL MARKETING AS A
BUSINESS MODEL
Multi Level Marketing is a very popular business model in the Western countries. It is a kind
of hybrid of the method of distribution of goods and the method of building a sales network.
It is one of the safest (carries a very low risk) ways of conducting a business activity. The
knowledge about functioning of this business model, both among theoreticians (scanty
literature on the subject) and practitioners, is still insufficient in Poland. Thus, the presented
paper has been prepared as — in the Authors' opinion — it, at least infinitesimally, bridges
the gap in the recognition of Multi Level Marketing issues. The aim of the study was, first of
all, to describe Multi Level Marketing, to indicate practical benefits of this business model as
well as to present basic systems of calculating a commission, which are used in marketing
plans of companies. The discussion was based on the study of literature and the knowledge
gained in the course of free-form interviews with the leaders of the sector.
Introduction

The concept of running business operations through Multi Level Marketing is still a little
known business strategy on the Polish market. Low level of knowledge about the issue is
most likely caused by small amount of publications concerning the subject, as well as limited
access to these publications. This state of affairs isn't just bad for the development of this
form of activity. but also gives rise to flawed interpretations of the model by presenting it as
something akin to a financial pyramid or quasi-business. Despite these obstacles in the
environment, recently the activity of companies from the branch has been growing.
Companies that want to gain competitive edge an gain a foothold on the market by basing
their marketing strategy on Multi Level Marketing or using some of its elements to obtain
particular benefits are attracting more and more attention. Strong, constantly growing interest
in such solution for introducing and distributing products draws attention to this area of
knowledge and boosts demand for expertise making it possible to work out clever and well
thought-out strategy. In this state of affairs, the goal of this article is to explain the essence of
Multi Level Marketing, adapting its definition to current reality and presenting basic systems
of calculating commissions appearing in marketing plans of companies from the branch,
together with presentation of practical benefits. The deliberations are based mainly on the
study of scientific publications. Moreover, knowledge derived from direct research, carried
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out in form of interviews with leaders of companies basing their activity of Multi Level
Marketing was used.

When you think about starting your own business, you almost always take into
consideration the risk associated with the business, which directly connected with the amount
of capital that has to be invested in the venture. People characterized by high tolerance for
uncertainty concerning the return on investment usually accept the challenge, those more
cautious usually don't. This usually is associated with high market entry barriers and huge
capital needed to compete with current giants and major players on the market. Lack of
experience and lack of awareness of common practices in a given branch are another reason
discouraging usually young prospective businessman. However, few of them know that the
level of risk associated with capital and an idea can be regulated in a flexible way using three
different business models that can be used as a foundation for a business. The first is a well-
known, typical business model, which involves skillful implementation of a concept by
means of owned capital. In this model the risk of failure is very high, as it is associated with
two unknowns. One of them is the question whether an idea can catch on on the
market. The second unknown is the uncertainty concerning the return on investments.
However, despite high level of risk this is the most popular business model. Another model
characterized by comparably lower risk is business activity based on
a franchising agreement. It involves running business operations based on a previously
adopted and tested concept. For the price of a license you get the so-called record book,
which is a blueprint for a well-functioning company. Proper implementation of the purchased
blueprint should in theory lead to development and survival of a company on the market.
However, this shouldn't be treated as a rule, as a tested concept and the knowledge how to
implement the concept are not always sufficient to guarantee a return on investment.
However, it is possible to conclude that the discussed business model is characterized by
substantially higher likelihood of success than typical business activity. The last model that
can be used as a basis for a business is Multi Level Marketing. This model, compared to
others, is characterized by very small level of risk or even absence of risk. This results from
the lack of need to invest financial assets to implement a concept or buy an expensive
franchising license. This is possible thanks to operation based on recommending ready
products which in many cases have already gained popularity on the market. Additionally,
this model doesn't require costs associated with hiring employees, because work in the
company is based on voluntary membership. This means that you can achieve a similar lever

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effect as in case of typical business activity, but without the need to take the risk associated
with hiring employees. Taking into consideration low risk associated with absence of the
need to have own concept, large capital and costs associated with hiring employees, it is
possible to conclude that this is the safest business model.

The essence of Multi Level Marketing

Taking into consideration the differences between various business models and the
possibility of raising the flexibility of the level of risk depending on the choice of appropriate
form of activity, it is possible to try to define Multi Level Marketing. In literature on the
subject Multi Level Marketing is also called network marketing. According to Don Failla It is
one of the fastest-developing and still the least understood methods of introducing products to
the market1. It is mainly due to poor understanding of the system that multi level marketing is
often regarded as direct
sales, pyramid sales or even pyramid schemes. Wikipedia, which is one of the most popular
online encyclopedias describes it as: term defining marketing strategy and way of functioning
of a company and its partners — independent distributors. Multi level marketing is a branch
of direct sale, that is, it involves offering goods and services directly to consumers on the
basis of individual contacts, usually at client's home, workplace or in other locations outside
permanent retail sale branches. It is a form of sale outside a traditional shop chain (...) Multi
level marketing allows sellers to build personal structures of partners, who provide additional
commissions from their sales. Every seller in multi-level marketing has an opportunity to
build own structure of salesman in which everyone is rewarded based on the marketing plan
valid for each company. At the same time achieving higher rank in company hierarchy
doesn't necessarily mean higher earnings — as they depend on the above-mentioned
marketing plan2. As much as the above definition accurately describes Multi Level Marketing
as a marketing strategy, way of functioning of a company and a system allowing to build
individual networks for independent distributors, classifying it as a branch of direct sales is a
big mistake. The same could be said about the claim that Multi Level Marketing is a form of
retail sales. Don Failla, the author of “The 45-second Presentation That Will Change Your
Life” discussing the basics of network marketing points to an important difference between
these three methods of distribution. According to the author, looking from the perspective of
consumers, there are only five basic methods of distribution of products. They are:

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1. Retail sale, which is the most basic form of distribution carried out by means of a retail
branch, e.g.: grocery shop, chemist's shop, department store, online auction site.

2. Direct sale — covering usually the sale of insurance, kitchenware, encyclopedias, etc. In
this model of distribution commission from sold goods goes only to the seller who cannot
build networks of his distributors. In order to sell products or services offered by a
particular company, he has to be employed in the company as a sales representative. This
means that he works for the owner of a company, who is his employer, thus, he doesn't
work for his own benefit as in case of Multi Level Marketing.

3. Multi Level Marketing — Don Failla analyses this term by defining marketing as
transferring a product or service from the producer of service-provider to the consumer.
Multi Level Marketing as a system of rewarding people who contribute to
sale of products or provision of services. In the Multi Level Marketing method people
contributing to sale are those who recommend a purchase directly from a particular
company. The person whose ID is provided in course of making an order is rewarded for a
recommendation resulting in actual sale, as the bonus system is usually multi-level and
allows generating passive income, that is, income that is not the direct effect of the work
of recommending person. This works this way, as every person has the opportunity to
build individual consumer-distribution structures. In other words, multi-level system
rewards for directly recommended persons and recommended directly by direct ones.

4. Mail order sale — This kind of distribution is characterized by lack of retail points in
which goods could be exchanged for money. The client makes an order directly in the
company after learning about its offer on television, in telephone conversation or from a
received catalogue.

5. Pyramid sales — is an illegal organization of sales, which is often mistaken for Multi
Level Marketing. One of the main reasons for this is that illegal companies are presented
as a multi-level system. The difference that makes pyramids illegal and Multi Level
Marketing legal is the inability to distribute a product or provide service. If there are no
sales of a product, it is impossible to talk about marketing. Companies by promising high
sales convince participants to pay high one-off amount of money that allows them to
participate in the programme. Programme is usually built in such a way that it makes it

Page | 41
 impossible for participants to generate sales, as all payments go to the account of those
organizing the business. Thus, pyramid sale is nothing like Multi Level Marketing, in
which sale is always based on

a product or service and the commission system rewards participants depending on the
contribution, regardless of held position.

Don Failla's attempt to define various methods of distribution in a clear way shows the
differences between them. It also allows to fully reject the claims that Multi Level Marketing
is in the same group as pyramid schemes or direct sales.

Another interesting attempt at defining Multi Level Marketing is that of André Blanchard,
who defined it as an art of establishing and using contacts. Thus, Multi Level Marketing,
according to the author, involves distributing goods and services through a network created
based on contacts and ties between people and the participation of all members of the
network in this activity3. As much as this approach seems to
accurately define the way independent distributors function, it doesn't cover the subject
completely.

In order to fully illustrate the essence of the discussed notion, it is necessary to look into
Multi Level Marketing from two perspectives. One of them is the point of view of the author
of the concept, the producer or the company for which Multi Level Marketing is one of
possible ways of introducing a new product to the market without bearing huge costs
associated with promotion and without the need to transfer rights to a product to someone
else4. The second perspective is the point of view of an independent distributor for whom
Multi Level Marketing is a model of business which doesn't require a concept or bearing the
risk associated with investing capital, as in case of typical business activity or franchising.
Such an approach makes it possible to define MLM as: method of distribution of products, in
which costs associated with advertising and marketing are covered at the moment of actual
sale. Sales are fueled by clients of the company who use their contacts to recommend the
purchase of particular products. The company rewards the recommending person with a
commission calculated based on the company's marketing plan for a recommendation ending
with actual sale. Marketing plans create the possibility to generate unlimited revenues and at

Page | 42
the same time eliminate risk associated with the necessity to invest substantial capital
required to launch typical business activity.

Historical background of Multi Level Marketing

Looking at the definition of the term formulated this way inadvertently leads to questions
about the origins of the discussed business concept. In order to follow the historical course of
events, it is necessary to start the search in the Unites States where first written records can be
found. The oldest ones date back to early 1920's. In this period in the United States, direct
distribution of goods was an important part of social life. Many companies looking for
opportunities for sale of their products opened sales agencies around the whole country.
Producers delivered goods to agencies. Goods were later handled by direct distributors, for
example, traveling salesmen. Such agencies were run by experienced employees who often
used to introduce goods to the market themselves and used to start cooperation with and train
new distributors. As the growing number of trained distributors generated higher sales,
companies rewarded managers for the time devoted to new employees. Companies paid them
either sums set in advance or gave them a share in the value of sales of new distributors.

The first company functioning based on these rules was established by William
Casselberry and Lee Mytinger. From 1934 the company took care of distribution the products
of such companies as California Vitamin Company and Nutrilite XX Vitamins. In 1941 the
company implemented the first C&M marketing plan. Its main goal was to encourage
distributors to work aimed at sales, searching for and training new employees. On this basis
distributors could get 3% from sales of newly formed groups. Properly selected and trained
partners naturally brought about ever higher sales to the company. Sales in turn brought
higher profits to distributors who were more eager to train new partners.

In the 1950's the company was hit by a crisis. In 1959 two partners — Richar De Vos and
Jay Van Andel — left the company and established their own company — Amway. They
started production of own goods. They worked out a special rewarding system, which was
characterized by very fair division of profits, proportionate to the contribution of work to the
expansion of the company. After a few years rapidly developing Amway Corporation took
over Nutrilite. At more or less the same time another group of distributors left Nutrilite and

Page | 43
formed Shaklee company. The difference between them concerned mainly the products they
were dealing with. Whereas Amway dealt with household detergents, Shaklee dealt with
nutritional and food products.

The success of Nutrilite and the C&M marketing plan attracted the attention of other
companies like Stanley Home Products, Home Interiors and Gifts, mary Kay Cosnmetics to
the Multi Level Marketing system. In the 1970's Multi Level Marketing system came also to
Europe. In 1969 British company Kleeneze dealing with direct distribution of goods, looking
for new ways of selling products, recognized the method of Amway Corporation as very
good and was the first to start using it. In 1973 Amway (UK) Ltd., as well as Shaklee
appeared in Great Britain5.

In the United States the success of companies applying Multi Level Marketing attracted
much interest. For many rather dishonest businessmen manipulating the system of
commissions and membership gave a foundation for creating the so-called pyramid. It
involved encouraging distributors to pay quite big subscription fees and promising that these
payments would quickly pay back along with expansion of the network. Moreover, people
were encouraged to buy bigger batches of goods with higher discounts. As a result of this
many distributors blinded by visions of huge profits bought

a lot of goods and later had problems with selling them. The system was based on the
gullibility of people and was used by dishonest, but convincing individuals. It also led to
social concerns, which in turn resulted in the introduction of new legal regulations in all
countries where MLM is used. A good example here is Great Britain where in 1973 the
system of pyramid sales was forbidden under the act on honest trade practices 6. The
introduction of similar regulations on the territory of whole Europe counteracted the
dangerous phenomenon — dishonest entrepreneurs pretending they run MLM business.
Legal definition of the essence of MLM allowed gradual development of the discussed
branch of distribution.

Commissions in Uni-Level system

Page | 44
 In order to better realize the difference between forbidden pyramid systems and an
authentic structure of network marketing, it is necessary to understand the rules of
functioning of remuneration plans. One of the most basic remuneration plans functioning in
companies distributing products by means of Multi Level Marketing method is Uni-Level
system. It involves genealogical record of new clients directly under the person that
contributed to their joining. This means that a situation in which person X invites
successively persons A, B, C, D can be illustrated with the following diagram:

Picture 1. Uni-Level — Poziom 1

Person X

Person Person Person Person

A B C D

Source: Own materials.

As can be seen, persons A, B, C and D, from the point of view of person X are located at
the person's first level. Many companies that want to reward active clients
take advantage of Uni-Level system. A good example here is mBank7, which doesn't
distribute financial products through Multi-Level Marketing, but rewards clients with PLN50
for a recommendation resulting in actual opening of a new account. Thus, in case of person X
this would be PLN200.

Person A who invites persons 1 and 2 will get PLN100 and person B who invites persons
I and II will also get PLN 100. Person D will get PLN 200, just as person X for

X
Person A Person B Person C Person D

Page | 45
 1 2 2 2 A B C D

Source: Own materials.

It is worth pointing out here that in a Uni-Level system person X doesn't get a reward for
persons recommended by persons A, B and C, despite the fact that person X contributed
indirectly to their joining. To make such a situation possible, mBank would have to introduce
two-level Uni-Level marketing plan. Allocating an identical amount of PLN50 for a newly
opened account, PLN25 would be paid for directly recommended persons in the first line and
PLN25 would be paid for indirectly recommended persons in the second line. As a result,
person X contributing the same amount of work, that is, recommending four persons, would
get a PLN300, instead of a PLN 200 reward. Distributing evenly the amount of PLN50 to
rewards for five levels of the Uni-Level system, person X will receive (assuming that
everybody recommends opening a bank account to four other persons) PLN40 from the first
line, PLN160 from the second line, PLN640 from the third line, PLN 2,560 from the fourth
line and PLN 10,240 from the fifth line8. This means that paradoxically, decreasing reward
for direct recommendations and at the same
time raising levels for which commission is paid brings incomparably higher profits for the
same contribution of labour and time. As in the first and the second case person X
recommended the bank to just four persons, it is easy to notice how big the effect of lever is
in case of multi-level option. The reason why mBank wouldn't decide to resort to a multi-
level Uni-Level system is probably the still popular stereotype concerning financial pyramid
schemes. In order to highlight the differences between pyramid scheme and multi-level
system of calculating Uni-Level commissions, it is worth analyzing the concept of pyramid
scheme and juxtapose it with a scenario for further development of drawn-up structure. The
concept of pyramid can be described as a situation in which people situated on top of the
structure get most of the money generated by the work of people located lower. In other
words, the concept of pyramid scheme could describe any kind of business activity,
institution or organization. In order to prove it, it is enough to draw the organizational
structure9 of any company, in which the ranks in corporate hierarchy are highlighted.

Page | 46
 Picture 3. Organizational Structure

Owner

Directors

Deputy Directors

Managers

Employees

Source: Own materials

In the drawn-up structure of a company, various levels of organizational structure, starting
with the owner and ending with regular employees are highlighted. The shape of the structure
reflects the number of people employed at particular levels. Taking this into consideration, it
is necessary to confront it with the remuneration allocated to particular levels. It turns out
then that none of the regular employees is able to earn as much as people above him. In the
presented model the owner earns the most using the
lever effect, leveraging his efforts, deriving income from the labour of employed people.
Thus, high salary is not the effect of his high productivity, but the effect of his position in a
particular organization.

The situation in a multi-level Uni-Level system is completely different. In this system the
more productive person earns more regardless of the level it occupies in a given structure.
Analyzing an example of two-level Uni-Level system paying out a PLN25 reward for
recommendations from the first and second line, it is possible to illustrate the effect in the
following way. Assuming that person II from the second line of person X is more productive
than person X and recommends opening an account to 7 persons and each of them
recommends opening an account to another 2 persons, we will have a situation in which
person II earns much more than person X, even though it is located one level lower. This
situation is illustrated by the following diagram.

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 X

A B C

A B C D

I I I II

Source: Own materials

In the presented diagram person II will receive PLN175 from the first line and
PLN350 from the second line. This gives a total amount of PLN525, that is, more than in case
of person X, whose commission amounted to PLN300. The fact that person II can earn more
than person X proves that this systems cannot be regarded as a pyramid

scheme. Obviously, this all doesn't mean that person X is unable to earn more than person. In
case when the person is more productive and recommends products or services to more
people, person X will achieve higher revenues than person II.
The system described above shows a system which is more just than any other, as it
involves an honest mechanism rewarding most productive people. As in Multi Level
Marketing Systems the effects of work are the main basis for calculating commissions, every
participant is motivated to work in a possibly most effective way. However, such approach
can often lead to dissatisfaction with results not proportionate to the amount of contributed
effort. In order to avoid such discouragement and protect the company against slower pace of
growth of structures, other mechanisms for the construction of the network have been
introduced.

Commissions in a binary system

One of mechanisms which is supposed to additionally motivate and boost the pace of
building a network is a binary system. It involves horizontal limitation of the Uni-Level
system to two positions and at the same time unlimited vertical development of the network.
In other words, every participant of the network can have just two persons under him, just as
on the following diagram.
Page | 48
 Picture 5. Binary system

Source: Own materials

This means that adding third, fourth and each successive person to the structure, the
system enforces the registration of the person in the first free position under any of the two
previous persons. Thanks to this, it is possible to have a developing structure, without the
need for own activity associated with recommending products. The situation in which
more than two people are registered, can be presented on the example of person X discussed
in Uni-Level system.

In a binary system the the composition of the structure of person X would look this way.

Source: Own materials.

The above example shows that person A received person C for his or her own structure
and person B received person D. In the first and the second case this happened thanks to the
activity of person X. Persons A and B who notice new persons appearing this way may feel
additionally motivated to further work and expansion of the network. The concept of binary
system is mutual motivation and growing pace of growth of the network of clients. It is
achieved thanks to mutually connected sum of efforts of all participants. However, this
doesn't mean that higher position guarantees higher share in earnings. Taking into
consideration the fact that Multi Level Marketing Systems reward the effects of work and not

Page | 49
the occupied position, people located lower in the structure can receive higher commissions,
just as in the Uni-Level system. This effect can be achieved thanks to calculating commission
based on the sales generated by the weaker side. Thanks to this, as the presented example
shows, person X will receive commission from the sales generated by two persons, as their
sides are equal. However, persons A and B won't receive commission, as in the weaker part
of their structure there is no partner. This means that the person who develops its structure to
a greater extent, becomes the stronger side of the person above, achieving higher
commissions than the person above.

A good example of a company distributing its products by means of the Multi Level
Marketing method, using the binary system is happy.co. For a recommendation
resulting in actual sale of two computer programs, the company pays EUR 9 commission,
assuming that the maximum amount of commissions on the weaker side cannot exceed EUR
20,000 and that every new person recommends happy. co programs to only two persons.
Over the first month the following simulation of received commissions can be carried out.

Table 1. Marketing plan of Happy.co company

Commission for
Mont Number of people in Number of people sales
h structure
on the weaker side of the weaker side

1 2 1 9 euro
2 4 3 27 euro
3 8 7 63 euro
4 16 15 135 euro
5 32 31 279 euro
6 64 63 567 euro
7 128 127 1.143 euro
8 256 255 2.295 euro
9 512 511 4.599 euro
10 1024 1 023 9.207 euro
11 2048 2 047 18.423 euro
12 8 4 095 20.000 euro

Source: Own materials based on the marketing plan of happy.co company.

As the above table shows, binary system limits the level of possible income to
EUR20,000. In order to make it possible to achieve unlimited income, the binary system

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should function in combination with another system, which provides such a possibility. In
case of happy. co this is Uni-Level system, which adds commissions from sales of directly
added partners to the amounts provided in the table.

Commissions in the matrix system

The system closest to the concept of a pyramid scheme in programmes of Multi Level
Marketing companies is the matrix system. It involves horizontal limitation of the structure to
the value adopted by a particular company. The most common value in case of matrix
systems is the number three. This means that every partner of the company has three free
positions under himself. Deciding to register a greater number

of persons supports the first one, just like in case of the binary system. The reason why this
system is closest to a pyramid scheme is that commission is paid for every person in the
structure. This is the main trait that distinguishes this system from the binary system.

Analyzing the situation on the following diagram, person A, who is above two persons
directly recommended by person X, will receive the same remuneration as person Y, who is
above persons added thanks to the person Y's own recommendation.
Picture 7. Matrix system

Source: Own materials

This leads to an unfair situation in which unproductive persons are rewarded to the same
extent as persons who work. Moreover, the system will always be paying higher commissions
to persons who are higher until the moment the persons located lower fill to a greater extent
the levels beyond the reach of the former. In other words, if the system has four levels, the
person located in the second line is able to overtake the sponsor in terms of income as soon as
line 4 is filled to a greater extent and for the sponsor line 4 is line 5, which is beyond his
reach. Matrix system is another step after binary system, towards motivating less active

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individuals to further work. However, as much as in the binary system the motivation
involved unconditional growth of one side of the structure, in the matrix system it is
associated with unconditional payment of commission. Payment calculated this way in theory
creates higher likelihood of including passive persons in the process of building the network.
Taking into consideration rather unethical and dishonest methods of calculating commissions
in the
matrix system, most Multi Level Marketing companies combines it with the Uni-Level
system. Such a combination makes it one of the most pro-development systems for the
construction of networks, which also keeps fair rules for distribution of commissions.

Conclusion

The discussed systems of calculating commissions clearly show arguments supporting the
concept of running operations based on the discussed business model. In reality, hardly any
new business can bring such a rapid growth of revenues and at the same time eliminate the
risks associated with the need to invest capital. According to the U.S. ministry of labour and
the direct sales organization, the likelihood of earning USD100,000 in the same time and with
the same effort, is five times higher in network marketing than in case of typical business
activity10. However, we have to remember that in order to make launching a real marketing
plan possible, it is necessary to take into consideration a series of factors present in the
environment. We also cannot forget about the fact that market rules affect typical business
activity, franchises, as well as Multi Level Marketing organizations in exactly the same way.
The choice of the right company functioning based on the method of distribution of network
marketing should always require in-depth analysis and assessment of the capacity to achieve
success. Such meticulous and analytical approach should also protect against the risk of
joining a pyramid scheme, which often is uncannily similar to Multi Level Marketing. In
order to avoid this threat, it is necessary to carefully analyze a particular marketing plan in
terms of cash flows and verify the appeal and quality of the product or service offered by a
company. After confirming that the information presented by the company is credible, we can
start an amazing adventure and without taking a substantial risk, enter the world of business.

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 The future with network marketing

Network Marketing is a business in which we don't invest money but we invest time. The
industry that has created maximum millionaires in world.

Having spent 21 years in Network Marketing with one of the leaders in the space, while self
practicing and following Global top Network Marketing Leaders, I want to share my personal
experiences and findings this may help someone to understand growth, potential and get non
stop results in network marketing business.

#1 "A Supplement Income is today's major need globally, especially in India"

For the people who are doing Jobs!

Except for the 1% ones from the top brass, people realize they are not prepared enough as the
retirement age approaches. They have little savings than expected. Such savings may exhaust
while building a house or some other family or social commitments. Most don’t have any
major investments to start a business, thereby relying on Social Security and pensions. So
many liabilities, so many dreams are still left pending. People end up spending the post-
retirement on pensions and the savings from the job. And at that stage, life is just a
compromise with so many dreams left unfulfilled.

For the people who are running small businesses!

Many people run their own businesses with very low investments or on loans. Everything is
on loan. Houses, cars, personal loans, and later they realize that something has gone wrong.
They find themselves very restricted and miserable and lead a life from one loan cycle to
another.

Aforementioned could be one of the reasons or the ones coming next could be a few more
reasons why Network Marketing is of use.

#2 "Network Marketing is highly effective, efficient and a risk free business model along
with high earnings"

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A business model that permits to experience big earnings, luxurious life style, higher rewards,
excellent recognition, helping others to grow is the best working model. And network
marketing business contributes all said.

You get paid for what you produce by product sales to customers, and also by creating a
network of like minded people duplicating the same, as well developing leadership in
network. You get paid exactly for what you’re worth to the company. Network marketing is
simply developed on a number game and duplication.

In the corporate world, people hire talent, skills and qualifications to grow their business
model. But in network marketing, people educate others to groom someone's talent, skills that
benefit both the parties to reach where they want and get paid for producing a strong business
for the network. This makes network marketing more powerful. There are many more reasons
to start network marketing business to supplement earnings.

#3 "The Growth potential is incomparable, unique & unmatched"

Having been an independent consultant of Oriflame since last 21 years, I have all the reasons
to be bullish about the future and possibilities of Network Marketing Business. The company
with a management which follows ethics and guidelines set as per government and regulatory
bodies, are the best companies to work with. Top that up with leaders who are duplicating
and educating the same, you know where to start from.

Talking about the potential of networking, we have some best examples of networking in
different sectors. Networking structure is successfully proven globally. With time, we have
seen lots of changes in the networking style. In 1940's the networking model began by
offering franchises and as on today, network marketing has entered into an extended and
improved form, i.e. network marketing through direct selling and reaching customers through
personal recommendations. That helped to create a low risk business, more personalized and
customized service of their products.

#4 " Today, the world is a huge connected network"

In different sectors, hugely successful people have simply tried to create and maintain a
strong network. If we talk about Facebook, Instagram, What's App, they are successful
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because they were able to create gigantic networks of people. Further in FMCG, if we take
example of Coke vs Thumbs up, both are cola drinks but somehow, Coke has created a bigger
network than Thumbs Up globally. Patanjli is another brand which is established on a strong
networking bases. Firstly, they created a strong network and later created a strong selling
process, giving competition to other long time established FMCG brands. Similarly, KFC,
Pizza Hut, McDonalds, Pepsi and Ford spread all across the world in their own way. Creating
a word of mouth network for direct selling segment is the best way to improve supplement
earnings.

#5 "All ages should be engaged and remain active"

As per numerous surveys, people who are active and engaged in some work live a longer and
a healthy life. One should be actively involved and engaged in something to feel young at any
age. This is one of the most important parts. They get connected and keep their mind, soul
and body involved in great ideas and helping others to do the same.

#6 "Last but not the least"

Find your own reason and purpose to start off with network marketing. Since there is no
inventory risk, no need to employee staff and no huge investment required, why be inhibited?
Simply learn through successful leaders get proper coaching and guidance.

As per my learning and thought, Network marketing industry has now entered into its golden
phase, with the world being more connected than ever. With the combination of networking,
direct selling and digitalisation, network marketing will only create more success stories in
the times to come. To start with, just choose right company (avoid ponzi schemes) and try
your luck in the network marketing business.

Its always a personal choice to either allow someone to hire your skills, talent and
qualification or develop your own entrepreneurial skills through a network marketing
business with zero investment requirements.

At any age, and under any conditions, one can jump into the Network Marketing business and
that's the beauty of it. We just need to understand the way of doing Network Marketing,
under the guidance of someone who's been there, done that.
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Network Marketing- Great source of passive income
Stable job stable life is what our elders desires for us, and a decent salary with annual
hike and some bonuses lined up for you. Till now it’s going good as the plan and
what next, taking care of your family, 30 years of service and then retirement with an
adjustable pension policy which will help you survive the rest of your life. Finally
you depart to the heavenly abode, but the question is did you leave a mark as a
human being, did you get noticed as a personality, did you innovate as an innovator,
did you motivate and inspire as a philanthropist, question is did you?

Leaving this world unnoticed is what every other second person is doing. So this
section is for those who do not want to be the every other second guy. Had Warren
Buffet gave up his entrepreneurial nature and looked for a stable life for his family
then he would have been a US senator or maybe the president of the United States,
but the we could not have used the words like business magnate, investor and
philanthropist. The keywords are investing, marketing and networking and a p erson is
very successful if it is understood at a very young age. Whether you are investing or
investing time for future investments, you need to understand the market and how to
develop very good network out of it. Network marketing is a very old concept used

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by big business houses to increase their business and the same concept recently is
used by few companies to educate the youth ore into business and investment in
better prospects. More and younger people are getting drawn towards network
marketing because of the lucrative process it follows and moreover other than
instilling a good business sense it also helps in developing overall skills for the youth
which includes their communication skills, selling skills and presenting themselves in
front of a large crowd which includes their public speaking. Network marketing is no
doubt a great source of passive income and also ignites the entrepreneurial spirit
inside which leads a person to innovate the mind and explore for new and better ideas
for venturing into business. So simply start with network marketing and come out not
as the every other second guy but as the exception the society wants.

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 CHAPTER - VII

DOVLOPMENT
Advantage and Disadvantages

NETWORK MRKETING

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What is a Network and how it can be
used to improve your life?
“The richest people in the world look for and build NETWORKS.
Everyone else looks for work” – Robert Kyosaki

One of the biggest assets in anyone’s life is a generous network. Every person in this
world have only 24 hours in a day. Out of 24 hours we can utilise maximum of 24
hours. But surprisingly we can also utilise productivity of 100 hours or even 1000
hours in a single day! How? The answer is through “network”.
A man paints a big wall in 10 days. But 10 people can paint it together in a single
day!

Let’s suppose
today you are working for someone! You work daily for 10 hours a day. Your
productivity is 10 hours daily, and it cannot be increased. But what if you started
your own work and you hire 2 people(A and B). A works for 10 hours, B works for
10 hours and you too work for 10 hours. So total productivity increased from 10hours
in a day to A+B+YOU= 30 hours in a day. Similarliy when you hire 10 people
productivity increases to 110 hours a day. Moreover, you can sav e your time and
increase your income through building a network. Let us take an example of
McDonald restaurant! It was first started on 1940 by Richard and Maurice McDonald.
Today there are more than 36,900 McDonald’s restaurants all over the world which
the biggest restaurant network ever. They build a network of more than 36,000 which
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is again running by 3,75,000 employees which is a big network. Here is the simple
economic concept-
Income= Knowledge X Time
If you want to increase your income, you have to increase your time because
there is a limit to knowledge. The only way to increase your time is to build
network.
eBiz gives us exactly the same opportunity to build network with n o investment!
There are many examples of leaders who have built their team with a network size of
over 1,00,000 like Bhupendra Pal and Sumit Bijaka. Now they have a network which
works for them. Today they do not work for money like most people do, they work
for building a network of great values and for betterment of people who want
something out of their life. Building a huge network requires time and patience! if
you are ready to work hard and devote your few years of life then you can join the
most beautiful network building platform- eBiz. eBiz not only helps to build a great
network but it also helps in developing a person Physically, Spiritually, Financially
and Socially. In the beginning you will be alone, but slowly you will be developing a
network of 10, 20, 100 and more. You will be taught by many great leaders who are
already leading a great network. By increasing your team, you are adding number of
hours which are working for you even when you are busy or off for vacation.
Note: If you are not creating a network today then you will be soon a part of any
other network.

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Advantages of Network Marketing Model:-

 Network marketing model comes with a large workforce. Also, the workforce grows
very fast. Thus, it helps company to establish soon.
 In Network Marketing system, a company need to pay a nominal advertisement cost.
Most of the promotion is done by the workforce only.
 Company always stay connected with its customers as well as distributers. It provides
a 3D picture of the market as well as the distribution system of the company. Thus,
any internal problem in the sale or the organizational structure can be solved very
quickly.
 Network Marketing develops its market by the social network of the Distributers.
Thus it penetrates very quickly in the market.
 Network marketing gives employment to many people. It helps people to earn money.
One can join it as a part time job also.

Disadvantages of Network Marketing:-

 Companies cannot provide a range of the products. Customer is left with no choice,
but a single product to use. Thus, after some time, the companies start losing their
customers.
 In Network Marketing model, a company need to pay commission at every level of
the Pyramid. This process makes it an expensive one
 The workforce of the Network cannot be relied upon. All the distributers do not
perform well expect few. Thus, the Pyramid does not perform properly.
 Scope of Network Marketing is limited in India, due to the conservative behaviour of
the people. Behaviour about the distributers, about the quality of the products and the
reliability of the Chain system.
 The performance of the companies, who had tried the multi level marketing, is also
de-motivating. None of them had performed well. Most of them has adopted the retail
chain system or left the multi level marketing.

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 Chapter-VIII

Scope & Future

NETWORK MARKETING

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Direct selling industry may reach Rs 15,930
crore By 2021: ASSOCHAM
The Direct Selling industry in India has almost doubled since 2011 to reach Rs 12,620 crore
in 2016 and is expected to grow at a compounded annual growth rate (CAGR) of about 4.8%
to reach Rs 15,930 crore in 2021, reveals the study undertaken by ASSOCHAM The average
sales of each participant in India is about said $300 per year, that is, Rs 20,000, where the
global average is about $1,700 per participant per year or about Rs 10,000 per month, reveals
the ASSOCHAM paper.

"Direct selling opportunities can be enhanced in India provided we create a conducive

environment which is protecting all the stakeholders within the framework of the regulatory
framework", adds the study.

The top markets depicting the highest sales globally are USA (20%), China (19%) and Korea
(9%). India's ranking in the industry in terms of the size of the sector improved from 22nd in
2014-2015 to 20th in 2015-2016. Direct selling industry accounted for more than $183 billion
in retail sales globally in the year 2015- a new sales record for the industry. Every region in
the year 2015-2016 reported growth in its sales and 80% of the countries around the world
reported an increase in both sales and people joining the industry, adds the study. The Direct
Selling industry's contribution to the country can be mapped to various schemes introduced
by the Government of India in the past two-three years. The industry has been playing a
significant role in Skill India initiative by imparting soft skills, marketing and leadership
trainings in its network. It has also contributed positively to several other flagship schemes
launched by Government of India like Make in India, Digital India, Startup India and Women
Empowerment, noted the study. Despite of substantial growth over the years and a number of
ways in which it has contributed to Indian economy, this industry is the most misunderstood
and unacknowledged business activity. The main reason for the same is the use of networking
and schemes through which the activity of direct selling is undertaken. In majority of cases
(of course where credible entities/ promoters are involved) such network marketing schemes
are means to increase the expanse of business.

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However, India and its public has been on receiving numerous unscrupulous schemes where
people have lost money, credibility, honour and livelihood, noted the study.

Though the guidelines received the overwhelmed response within the industry, there are
certain other reforms which needs to be restructure to ensure a sustainable operating
environment for the Direct Selling entities need for implementation of guidelines at state
level, need for relaxation under the Foreign Direct Investment ('FDI') policy, enactment of
Consumer Protection Bill and need for amendment under the PCMCS Act.

Direct selling has been leaving imprints of its growth and success globally over the years. It
has become an extremely popular self-employment model across the world. There are several
reasons for this immense success, best quality products, personal connection and bonding
with consumers and promotions of entrepreneurship are some of the major factors
contributing to its growth.

Apart from the minimum cost and low risk involved in direct selling, the popularity of this
model stems from the fact that entrepreneurs engaged in direct selling are able to provide a
personal touch to their interactions with customers through personalised and custom-made
demonstrations and in turn, expand their professional network of contacts.

Countries such as the US, China, Japan, South Korea, Brazil, Germany, Mexico, France, the
United Kingdom and Malaysia are already been listed as top direct selling markets. The reach
of direct selling is spreading quickly in almost every country around the world.

Direct selling, besides providing self-employment opportunities to numerous people around

the world, also helps in advancing the overall trade and commerce of an economy; thereby it
contributes in boosting the overall economic growth of a country. In countries like Mexico,
which have similar socio-economic structures, with one-tenth of India's population, the size
of the direct selling industry is at least eight times bigger than the Indian market. Direct
selling industry makes an economic contribution to the lives of more than 30 million people
across the world and an estimated 220,000 entrepreneurs join this industry every week. The
international direct selling companies account for a dominant 90 per cent of the organised
market.

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One of the most tangible impacts of direct selling in its new advent has been the fact that it
has touched average individuals in a manner never experienced before. Giving freedom to
people for doing business in the way they have always wanted is proving as a motivational
factor to display their entrepreneurial skills. This is expected to accelerate further as the
business grows and expands.

The sales in the direct selling sector in India is dominated by the consumer health segment,
closely followed the beauty and personal care segment. Food and beverage category in direct
selling registered strongest value growth of 34% during 2014-2016. Wellness and healthcare
category is emerging as a clear winner in direct selling industry with significant growth year
on year.

In India, the Direct Selling Industry has existed for several years, but the entry of numerous
international companies, during the last five years has accorded greater visibility to this
industry, which is still in a nascent stage. According an Annual Survey 2015-2016, it is
estimated that over the past five years, about 500,000 people benefited from the opportunities
offered by the industry.

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 Introduction to the Indian Direct Selling Market
The direct selling companies have been growing in high double digits on the low base and are
extremely bullish on the future. While the steep growth rates of over 50-100% are unlikely on
the higher base, growth will nevertheless remain higher than traditional retail businesses.

Nutrition and wellness products have been a key growth driver in the last 6 years.

The health and wellness products segment is likely to see continued growth as alternative
channels for these products are not well established and personal recommendation is critical
for driving penetration.

Most existing players are looking at this category to drive growth, besides personal care and
household care products.

The success of direct selling initiative of a FMCG company could spur other traditional
FMCG companies to emulate the structure and develop a parallel distribution network.

A few issues need to be addressed to encourage the healthy growth of the direct selling
industry in the very near future.

i. High attrition rate -Most directs sellers in the country face a high rate of attrition.
Although official estimates put the figure at 30-45%, attrition in practical is estimated
to be as high as 70- 90%.

The reasons for this are:

o Most of the kits (products if purchased initially) bought by the direct sellers
end up being consumed by themselves. Estimates put the percentage of self-
consumption at almost 50-60% the total volume.
o Some even enrol to take advantage of the discount of 10-20% which is a direct
seller margin if he sells the products at the maximum retail price. This worked
well initially when trials were the sole imperative. In the first stage of
expansion, direct sellers are encouraged to use the products themselves so as
to motivate others to buy them after they have experienced the products. But
in several cases, this self consumption does not translate into repeat purchases.

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 o The percentage of "active" direct sellers remains quite low at about 10-30%.
Many people who join in the initial frenzy end up returning the kit (starter kit
if purchased) within the first month. Overall returns constitute about 1-4% of
the total direct sellers recruited.
o Even among the active direct sellers, only about 10% show reasonably high
levels of activity.
o Delayed ratification – most people lose patience and drop out before they
achieve significant business volumes. The returns (commissions on sales of
the products by the team) are very low in the initial stages and build up with
time. But most direct sellers do not have the perseverance and discontinue
after a few months.
o Industry majors expect that attrition is given in the industry and would
continue even if adequate training and support is provided to direct sellers. It
is beneficial to the extent that non performers automatically exit the network.
ii. Price sensitivity - In India, most direct selling companies initially launched products
at hefty premiums to existing brands in the category and were unable to garner
adequate volumes. Also large sized packs sold by these companies further
discouraged consumers, who were not used to buying in bulk. Realizing the price
sensitivity of the Indian consumer, some of the companies are now reducing the
package sizes, so that the consumers do not have to spend too much at one time, and
thereby perceive the product as affordable. Sachets have been launched by most
players, in the personal care category such as shampoos, face wash, etc to expand the
consumer base. Also, a few players who initially targeted only the premium end of the
market have now also launched mass-market products, offering a total price range
catering to all customers.
iii. Perception problems - Several people believe that direct selling is an unethical
business. A few countries have even discouraged the establishment of direct selling
companies. Industry participants feel that these perception problems arise due to
mistaking direct selling as similar to pyramid schemes.
iv. Emergence of fly by night operators or half baked concepts who set up direct selling
business without any prior experience or guidance and are thus not able to succeed
also affects the reputation of genuine players.
v. Low success rate among direct sellers - Most people who drop out because they are
unsuccessful, blame the system rather than their own inability to be a successful

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 seller. With a high drop out of 90% and a very few highly successful people (5-10%),
the negative word of mouth publicity is much higher than the positive publicity. This
leads to more and more people developing a negative perception of the business.
People have therefore tended to focus more on direct selling failures than on
successes.

However, this appears to be changing with entry of direct selling consultants who have a
reputation and global experience in direct selling. Direct selling consultantprovides adequate
training and guidance to the direct sellers, thus ensuring a higher success rate among new
direct sellers.

Network Marketing: A Growing Industry, Hard Facts and the Future

Direct selling companies market goods and services through networks of thousands of
independent distributors. These distributors either buy products from their companies and
then resell them to consumers, or they sell products on behalf of their companies for a
commission on retail sales.

Network marketing gives direct selling a new spin. In both types of companies, distributors
make money by selling products directly to consumers. But in network marketing companies,
distributors can also make money by building their own sales organizations and receiving
commissions or bonuses on the sales generated by the distributors in the organizations. The
term “multilevel marketing” springs from the fact that distributors receive commissions on
multiple levels of their organizations. Most direct selling companies today are structured this
way.
Much of the power of network marketing springs from the fact that most people tend to seek
advice about products, services, and even business opportunities from their friends and
relatives. Moreover, they generally trust that advice. In fact, a poll by the Roper Organization
revealed that the advice of friends and relatives carries even more weight than the advice that
comes from strangers with impressive credentials. The poll showed that for every person who
seeks financial counsel from a financial planner or stockbroker, three go to friends and
relatives for advice.

Network marketing allows people to put that trust to work in a positive way that can improve
the lives of those who give the advice, as well as those who take it.

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Hard Facts and Demographics About a Growing Industry from 2006 (These facts are
constantly changing but are reflective of the immensity of the direct selling industry)
 Every week, more than 55,000 people in the United States alone sign up as network
marketers – 150,000 per week worldwide.
 In excess of 13 million people in the United States alone are distributors for network
marketing companies; one in ten households have a direct seller.
 Throughout the world, there are approximately 50 million network marketing
distributors.
 In the United States, sales in the network marketing industry are in the $30 billion range.
Worldwide sales approach $90 billion.
 The world leader in network marketing is the U.S. with Japan in close pursuit in the $20
to $30 billion range. Countries with at least $1 billion in sales include the U.K., Brazil,
Italy, Germany, France, Canada, and Taiwan. Business is booming in the new frontiers
as well: Eastern Europe, Russia and the People’s Republic of China. In fact, Amway in
2004 is headed for $2 billion in China, country only on the brink of formally allowing
the reintroduction of network marketing.
 Seventy-five percent of all network marketing distributors are women. Men account for
25 percent. (These numbers likely reflect the demographics of long-dominant companies
like Avon and Mary Kay. Recent growth in the industry has been among newer
companies that have a more even balance between male and female distributors.
 Approximately 80 percent of networkers are part-time and 20 percent full-time people
who work 30 hours a week or more in their business. For the vast majority of networkers,
it is a “second job,” with the hope of $300 to $500 per month in auxiliary income.
 About 3 percent of all networkers will make more than $35,000 a year; 2 percent will
make more than $50,000; 0.5 percent will make more than $100,000 annually; and about
0.1 percent will make more than $150,000.
 About 13 percent of direct marketers are African-American; almost 5 percent are
Latinos; 1 percent are Asian; and about 0.5 percent are Native Americans.
 Approximately 66 percent of distributors are between ages 25 and 44. Another 14
percent fall into the 45 to 54 age bracket. Seniors over the age of 65 account for about 5
percent of direct sellers.
 About 8 percent of direct sellers have physical disabilities.
 Over two-thirds of all network marketers have high school degrees or some college
education, and 25 percent have a college degree or beyond.

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The Future is Up
So, where is this business going? The answer is “UP.” During the next decade, the Direct
Selling Association projects that network marketers will recruit more than 200 million new
distributors into the business worldwide. Asian markets are expanding rapidly, including
India. In fact, even during recessions, the direct selling industry proves to be rather resilient.
To know that all you have to do is check out the latest headlines. That’s not bad for a cottage
industry that started with potions and lotions. Many will be along for this ride
.

What Are Some Network Marketing Myths

1. Multi-level marketing (MLM) classes are taught at Harvard Business School.
2. Network marketing has produced more millionaires than any other type of business.
3. MLM will dominate the economy in the 21stcentury.
Unfortunately, these statements are “urban” MLM myths that are over the top and damage
the credibility of distributors and companies, as they promote the truly positive opportunities
of direct selling.
1. Historically, the Harvard statement preceded the actual teaching of MLM classes. A
Harvard case study on a company such as Mary Kay, or a lecture by someone like Mary
Kay, was twisted into the proposition that MLM was part of the curriculum. This
assertion was not true, yet it was repeated over and over. Since that time, various
universities such as University of Illinois at Chicago or Utah Valley State University and
others have instituted courses. Many professors have joined the ranks of scholarly
articles on direct selling. And so there is plenty to talk about without misrepresenting the
facts.
2. Let us address the myth of networking marketing producing the most millionaires
compared to any other type of business. Of course, MLM has had its share of
millionaires, and a few billionaires from such companies as Amway. They can be found
on America’s wealth lists. It is a vast overstatement in a country with 300 million people,
and where there are about 16 million distributors with statistics indicating that only 1-2%
make enough money to amount to a full-time living, to have millionaire-expectations. In
fact, the exaggeration has prompted the FTC and state Attorneys General to demand, and
leading companies have acceded, to post average earnings disclosures which accurately
show the experience of typical distributors in their program. Again, there is room to be

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 proud of the opportunity and success of many, but overreaching earnings claims taints
the potential recruitment pool.
3. Will MLM dominate in the 21st century? The simple answer is: No. Keep in mind that
U.S. MLM sales hover in the $30 billion range in an economy of that posts $17 trillion,
i.e. about 1/5 of 1% of national revenue. MLM will play an important role, but, again,
there is no useful purpose in being caught in an exaggeration.

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 CHAPTER - IX

FREQUENTLY
ASK
QUESTIONS

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FREQUENTLY ASKED QUESTIONS
I am an eBIZ Retailer and have sent Demand Draft for the purchase of eBIZ package
and have accumulated 10K PVs and became eBIZ representative but still I am unable
to access my genealogy area?
Answer: In order to do the needful please send the followings :
1) Acceptance of Agreement ( Acceptance Form ) duly signed by you and your sponsoring
Representative as witness.
2) Bank Demand Draft details (i.e. Bank Demand Draft Number, Issued Date, Issuing Bank
etc.)
3) your eBIZ account details (i.e. Tracking ID, Distributor ID, Username etc.).

2). I have purchased eBIZ Package and have helped two existing eBIZ Retailers in my
organization to buy eBIZ Package and hence become eBIZ Representative. My
organizational eBIZ representative are working very hard and I am getting
commissions due to the business generated by them. Would I continue to earn
commissions forever, if I keep on maintaining my qualifying conditions every year?
Answer: eBIZ.com is engaged in selling its Packages / Products / Services as a Business and
to teach the masses fundamental computer learning as a mission through its Direct Sellers.
Any person, who wishes to become eBIZ Representative and wants to be engaged in
promotion of our Business / Mission, is given incentives / commissions. But the commissions
earned by an individual are directly proportional to his/her involvement / participation in
promotion of our Business / Mission. If any eBIZ Representative is not actively involved in
development of the business of his organisation or not promoting the Mission of Computer
Literacy among the masses or not participating in any event organized by eBIZ / eBIZ leaders
or not conducting any event by himself / herself or reluctant to Teach / Train / Help
personally sponsored eBIZ Representatives in promoting the eBIZ mission, the company
reserves the right to deny all pending, forthcoming as well as on going commission without
any intimation to such eBIZ Representatives. In that condition the decision of eBIZ.com
would be the final. All our eBIZ Representatives are requested to write to us in case they are
aware of any such case.

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3. Can I get my Group Incentive uninterruptedly without helping my personally
sponsored and downline Representatives?
Answer: No, in order to generate Incentive you need to work hard and motivate and trained
continuously your organizational Representative.

4. I have Purchased eBIZ Package and have sent the cost but after sending the cost I
want to cancel the purchased product and want to seek the refund, What is the
procedure for refund?
Answer: A sum of Rs. 310 (inclusive of GST) would be deducted as processing charges if
we receive the request of cancellation of the package within 48 hours from the date of placing
order for purchase.
Rs. 625 (inclusive of GST) would be deducted as processing charges if we receive the request
after expiry of 48 hours from the date of placing order for purchase and within 30 days from
date of receipt of cost of the package.
Rs 925 (inclusive of GST) would be deducted as processing charges if we receive the request
after 48 hours from the date of placing order for purchase and within 30 days from date of
receipt of cost of the package but after dispatch of the package by the company (these
deductible charges are subject to the condition of package contents which is sent back to us
by the purchaser), if contents are damaged then the same would not be eligible for refund /
cancellation.

5. I have purchased eBIZ Package, due to non availability / wrong address or any other
reason it was not received by me and send back to the company, what is the procedure
to get it back?
Answer: Since there is a cost involve in resending the package to the purchaser, so in order
to get back the returned package, purchaser has to send a demand draft of Rupees 310 with
modified shipping address, if any. Address can be provided online by filling the details in
logged in area of Retailer / Representative. Also the said package could be collected from the
eBIZ office personally by showing the identity proof(s).

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6. I am not satisfied with the Package / Product / Service and have sent the payment.
For refund, as per the policy of the Company I failed to intimate for the cancellation of
my Package / Product / Service within the allotted time (which is 30 days from the date
of payment received by the company). What should I do to recover my money paid
towards purchasing of eBIZ Package / Product / Service?
Answer: If you are not satisfied with the Package / Product / Service you need to write for
cancellation at support.ebizel.com and send the physical Package / Products / Services (if
any) within 30 day. We will not consider cancellation if your request for cancellation is
received after the expiry of this period. After an expiry of this period, we cannot refund the
money paid towards purchase of any of eBIZ Packages / Products / Services in any
circumstances as after the expiry of this period the Incentive with respect to your sale is
already paid to your Selling eBIZ Representatives.

7. Is it necessary to attend National Conventions or any other event organized by eBIZ ?

What would happen if I could not attend such events due to some unavoidable
circumstances?
Answer: Yes, it is mandatory to attend National Conventions organized by eBIZ, if you want
to participate in our Business / Mission. Failing which you will be denied the benefit of all
your organizational sales. But in case you could not attend due to some unavoidable
circumstances, you need to write a letter to the company with the documentary proof for
justifying your circumstances. On the basis of the documents produced by you, company
would decide whether to waive your attendance or not. The decision of the company in the
regard would be final. However, if you do not wish to participate in promotion of our
Business / Mission and Just want to LEARN through our courses and want to use our Product
/ Services, then it is not mandatory for you to attend these events.

8. How many Quizzes an eBIZ Representative needs to pass successfully in a year (from
the date of registration) to continue to get the benefit of the Business generated, if any?
Answer: In order to get the benefit of Business it is mandatory to promote eBIZ Mission. As
a part to this Mission every year an eBIZ Representative needs to pass the final Quiz of at
least one course. He/she can get access to the final Quiz only when he/she successfully passes
Quizzes on all chapters of that particular course.

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9. Is it necessary to help Free Students to pass online Quiz on Free Basic eBIZ
Educational Package to earn commissions for the next year by an eBIZ Representative?
Answer: Yes, each Free Student sponsored by an eBIZ Representative will have to pass the
final Quiz of at least one course. One can get access to final Quiz of a course only when
he/she successfully passes all chapters Quiz of that particular course.

10. How many Free Students are to be sponsored by an eBIZ Representative to get the
commissions continued for the next year?
Answer: An eBIZ Representative will have to sponsor two Free Students every year.

11. How can I get my lost password?

Answer: Send us a written request along with a Bank Demand Draft of Rs.180/- inclusive of
GST, in favour of eBIZ.com Pvt. Ltd., payable at New Delhi to get your lost password or
Tracking Id. Please, include Distributor ID, Username and Mailing address with the request.
We will send your password or Tracking Id by courier as soon as we receive your request.

12. Can an eBIZ Representative share information of any other Programme / Business
or sign up other eBIZ Representative in any other similar Programme / Business?
Answer: No, this is absolutely not permitted. If any complaint is received that any eBIZ
Representative is sharing information with other eBIZ Representatives of any other
Programme / Business, then all pending, forthcoming as well as on going commission from
the company, will be denied to him/her with immediate effect without any notice.

13. As many eBIZ Representatives are earning very good income through eBIZ
Business opportunity so can I advertise indicating you may earn some amount per
month or per week for attracting new eBIZ Representatives?
Answer: No, this is not legal to advertise any earnings as eBIZ incentive plan depends upon
real hard work, which includes learning from the Company and then Teaching / Training /
Helping to others as many eBIZ Representatives may not do what is required to be
successful, so they will not earn anything. It is very important to understand everything about
eBIZ Mission / Business before promoting eBIZ Business / Mission. In case, you invite any
legal problem due to any bad advertisement / promotion or due to lack of knowledge to
explain / express our Business / Mission to Law enforcing Authorities, company will not be
responsible for the same.

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14. I have wrongly entered my Username. How can I change it?
Answer: Any kind of modification in Username is not possible once the online registration
process is over.

15. What is the procedure for the Transfer of purchased Product?

Answer: Post your request at support.ebizel.com. company will investigate your request, if
approved we will send you transfer form and other details via email.

16. How can I get the Username and password of a transferred Product?
Answer: After transfer takes place we will mail all the details at the address provided by you
on the transfer form.

17. I have not submitted the photocopy of my PAN card. Would I be eligible to receive
my commission cheques/TDS certificate?
Answer: If you have not submitted a photocopy of your PAN card, then please send it as
soon as possible. We will not issue any Incentive cheque in absence of proof of your PAN
card.

18. How much time does it takes in activating the genealogy area if payment for the
purchased package is made by cheque?
Answer: We do not entertain payments through cheques. The payment for purchase of any
Package / Products / Services should only be made through Demand Draft payable at New
Delhi or through NEFT / IMPS ( online banking ).

19. When my genealogy area get activated?

Answer: Purchase of eBIZ Package:
eBIZ Representatives accumulating 10k PV by purchasing eBIZ Package and sending Bank
Demand Draft. The Genealogy Area would be activated on the receipt of such Demand
Draft.
Purchase of eBIZ Products :
eBIZ Representatives accumulating total 10k PV by purchasing various Products. The
Genealogy Area would be activated after the cancellation period is over of these purchased
Products.

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20. After purchasing the Product online I could not send the money on time and the
Purchased Product is disabled. Can this disabled Purchased Product be again enabled?
Answer: If your Purchased Product is disabled due to non-receipt of your payment within 10
days then it can not be reactivated / enabled.

21. Why one of my eBIZ Representative name from my organization is shown in black?
Answer: If any of the names is shown in black, it means the Purchased Product has been
disabled.

22. I have sold eBIZ Packages to many people in my organization; still I have not
received any Incentive. Why?
Answer: You start receiving commission only when you fulfil the criteria fixed for
commission earning. In order to receive your first commission you must accumulate 30K BV
with 1:2 or 2:1 ratio in both legs and out of these 20K BV must be accumulated via sales of
eBIZ Packages under your direct sponsorship.

23. I have seen online the last commission earned but I have not received it yet.
Answer: If you are 18 years of age or more and have sent us the photocopy of your PAN
card then you are requested to wait for at least 10-15 days depending on the location of your
residence as all commission cheques are sent either through courier or speed post / registered
mail. If you do fulfil the mentioned conditions and still have not received your cheque within
this period then send / post your query at support.ebizel.com. However we strongly
recommend to set up online transfer by way of sending NEFT details to us.

24. I have updated my address in update profile, but I am still receiving cheques at my
old address.
Answer: The modification done in the address through the update profile is only for public
view (for Sponsor and eBIZ Representatives only). So after updating your address through
update profile option send us your new address along with your Tracking ID, Distributor ID,
Username and any Photo ID (Passport, Voter ID Card, Driving License, PAN card etc) at
support.ebizel.com for updating your current mailing address in our records.

25. Can I register Free Student anytime I want?

Answer: You have to register Two Free Students every year.

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26. Who is an eBIZ Retailer?
Answer: An eBIZ Retailer is one who can get oneself registered as an eBIZ Retailer without
purchasing any Package / Product / Service. However we will provide courses available in
Free Basic eBIZ Educational Package to all our eBIZ Retailers. Retailers are not eligible to
get any Incentive under any Inventive plan.
These eBIZ Retailers can earn by way of purchasing the eBIZ products at retailers price and
sell them at any price below MRP and can earn the difference. eBIZ Representative can also
earn this difference along with Retail and Group Inventive Plan.

27. Who is an eBIZ Representative?

Answer: Any eBIZ Retailer who has Purchased eBIZ Package or Products and have
accumulated 10K PVs. eBIZ Representative is provided access to genealogy and all our
services. eBIZ Representative can also earn through Retail and Group Incentive Plans, if they
wish to promote our Business / Mission, by way of working very hard.

28. Can I join any other Marketing company dealing with same/different product and
doing the business of similar nature ?
Answer: No, you can not join any other Marketing company selling same/different product
or any other business of similar nature. If we receive any complaint against you that you have
joined any other Marketing company or Business of similar nature then you would lose your
right to get all pending, forthcoming as well as on going commission from eBIZ.

29. Can we make the payment ( Cash / Demand Draft / Cheque ) for the purchase
package to our selling eBIZ Representatives on behalf of Company ?
Answer: Cost of Package should be paid only through Demand Draft / NEFT / IMPS and
directly to be sent to the company by the purchasing eBIZ Representative. If any payment on
behalf of the company is made to any selling eBIZ Representative through any mode,
company will not be responsible for any loss ( if any ). The purchasing eBIZ Representative
himself / herself will be responsible for any such loss ( if any ).

30. By purchasing more than one eBIZ Packages in my name, can I create Multiple
Business Centers in my organization to create more income?
Answer: No, you can not create multiple positions and buy more than one eBIZ Packages.
As creation of Multiple Business Centers to generate more income is not allowed and

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violation of this would result in cancellation of all the created Multiple Business Centers
without any notice.
31. I have purchased eBIZ Package. Can I purchase another eBIZ Package on the name
of my spouse?
Answer: Yes you may do so.
32. Why my last name is appearing twice?
Answer: You might have entered your first name twice or entered the same name both in
first and last name. Kindly send / post us a request at support.ebizel.com with your Tracking
ID, Distributor ID and Username for correction of the same.
33. What will happen if any eBIZ Representative is found to involve in anti-company
activities?
Answer: This is very serious, if any eBIZ Representative is found not working in accordance
with our LEGALS (Terms and Conditions) / FAQs or found to indulge in any anti-company
activity in any manner or found disturbing the private or public business meeting or free
teaching seminar organized by eBIZ Representatives or by the company, all pending,
forthcoming as well as on going commission from the company, will be denied to him / her
with immediate effect and without any notice.
34. I am sending / posting lots of queries to the company but not getting any response?
Answer: It has been observed that many eBIZ Representatives are sending irrelevant queries
and asking irrelevant question unnecessarily on continuous basis. We have given all the
required information about the Company and all other details on our website. So it is advised
to all the eBIZ Representatives to visit our website in order to know their concerns or ask
their introducing active senior Leader eBIZ Representatives. Please note no irrelevant queries
would be replied by the company. Please do not ask about anything which is not given on our
website.
35. My password and other details are disclosed during online registration for the
purchase of eBIZ Package, what should I do now?
Answer: It is your duty to change all the confidential information like password etc.
immediately, after taking all the information from your Selling eBIZ Representative. We will
not be responsible for any mishappening in this regard.
36. In order to advertise eBIZ Business / Mission through the print media do I need to
seek any permission from the company?

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Answer: Before advertising you must send us the advertisement material for approval.
Severe action would be taken if we observe any bad advertisement (which violates any of the
law of the land or public policies) without permission of the company.

37. Is it necessary to follow LEGALS (TERMS AND CONDITIONS) and other

information given on the website www.ebizel.com for promoting eBIZ
Business/Mission?
Answer: This is mandatory to follow our LEGALS(TERMS AND CONDITIONS), FAQs
and other information given on our website. Any anti-company activities or non performance
of any activity / activities as required for promotion of eBIZ Business / Mission would
amount to suspension / cancellation of all pending, forthcoming as well as on going incentive
and denial of continuation of contract. Decision of the company in this regard would be final.

38. How much time does it take to get my earned commission cheque?
Answer: The commission cheque to the qualifying eBIZ Representatives will be reached by
courier or speed post within 20 days from the day commission is calculated. Online
commission / NEFT will be transferred directly to your Bank account provided by you within
8 days from the day commission is calculated. If the payment not reached at your Address /
Bank Account within these specified periods, you are requested to post / send your query at
support.ebizel.com with details of the earned commission.

39. I have attended various Conventions / Seminars / Workshops / Training

Programmes and Silver / Gold / Diamond / Diplomat and above meet organized by
eBIZ and now I want to organize a Convention / Seminar / Training Programme or
Silver / Gold / Diamond / Diplomat and above meet on my own. Can I do so with the
help of my Leaders?
Answer: Yes, you may organize any Convention / Seminar / Training Programme or Silver /
Gold / Diamond / Diplomat and above meet on your own. In order to conduct any such event,
you need to inform and seek approval of President eBIZ.com Pvt. Ltd. We strongly
recommend the entry fees ( if required ) for any event should be taken only for meeting the
expenses of the event and no additional charge should be taken in any circumstances. eBIZ
Representative sharing any portion of money for promotion of any event organized by
eBIZ.com Pvt. Ltd. or by them or by any leaders would be viewed very seriously. President
eBIZ.com Pvt. Ltd. or any Leader authorized by President eBIZ.com Pvt. Ltd. can investigate

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the total amount collected and spent for conduct of any event organized by any eBIZ
Representative. Please note that any taxes (if applicable) is the liability of the organizing
eBIZ Representative(s) of such event and company will not be responsible for any taxes (if
applicable).

40. Is it necessary to attend the compulsory events organized by eBIZ ?

Answer: Yes, It is mandatory to attend the compulsory events organized by eBIZ, Failing
which will denial of any benefit as well as stop addition of BV of his / her organization.

41. Could I share information which is not given on our Website www.ebizel.com but
provided by our senior selling eBIZ Representatives or others for the promotion of
eBIZ Business / Mission?
Answer: Only information available at our website related to Company or its President /
Directors should be given to other eBIZ Representatives / Guests for promotion of eBIZ
Business / Mission. Any eBIZ Representative violating this will not be allowed to promote
our Business / Mission anymore and his / her all pending, forthcoming as well as on going
commission will immediately be stopped.

42. I am organizing several weekly Business / Product meetings for my eBIZ

Representatives and their Guest for promotion of eBIZ Business / Mission. Do I need to
inform about these meetings to the company?
Answer: All Diamond and above eBIZ Representatives must inform all the Business /
Product meetings organized by him / her every month. Failing which will lead to denial of all
pending, forthcoming as well as on going commission without any prior notice. The decision
of the company in this regard would be final and shall be binding on the eBIZ
Representatives.

43. Is there any charge for resending the returned online commission transfer?
Answer: If your Online Commission transfer have been returned due to wrong Bank details
or account closure, then you have to send a Bank Demand Draft of Rs. 180/- for each
returned online commission transferred with your complete address, Distributor ID, Tracking
ID, User name etc, with Properly filled Online Commission Transfer form ( For fund transfer
only ) available in download section at our website www.ebizel.com to resend your
commission cheque / transfer.

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44. I am an eBIZ Retailer. Can I convert myself to eBIZ Representative?
Answer: Yes, By accumulating 10K PV from purchase of various eBIZ Packages / Products.
45. What is the meaning of Business of Similar Nature as mentioned in Legals?
Answer: Any Direct Sale / Network / Referral Marketing Business dealing with any Products
/ Services with any Business Model is termed as Business of Similar Nature.

46. What is the meaning of "Join / Commence" Business directly or indirectly as

mentioned?
Answer: Joining / Commencing Business of similar nature directly or indirectly means that
you can not Join / Commence Business of similar nature directly on your name or indirectly
on the name of your Spouse, Father, Mother, Brother, Sister, any close relative or through
any legal entity or incorporated company held by you.

47. Can Any eBIZ Representative demand / accept any partial / registration amount for
sale of any eBIZ product?
Answer: No eBIZ Representative is allowed to accept any partial or full amount in cash for
the sale of any eBIZ product in any circumstances. Purchasing eBIZ Representative must
send the Cost of the product directly through a Demand Draft or through online transfer made
by them directly on the name of eBIZ.com Pvt. Ltd. only to eBIZ House.

48. Is it necessary to send AFFIDAVIT as given in login area for all Silver and Above
eBIZ Representatives?
Answer: All Silver and Above eBIZ Representatives must send AFFIDAVIT as given in
login area to eBIZ office within 30 days from the day they have achieved new designation
otherwise all the pending, forthcoming as well as on going commission would be stopped
without any prior notice.

49. Is there any grace period available to complete required condition?

Answer: No grace period is available, so you need to complete the required conditions within
specified period only.

50. What are PV (Personal Volume), BV (Business Volume ) , RV (Retail Volume ) ?

Answer: PV ( Personal Volume ) : Whenever you buy any product you will earn Personal
Volume. Each and every product is assigned Personal Volume.

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BV ( Business Volume ) : Whenever Representative introduces a new Retailer and Retailer
buys any eBIZ Package, Representative earn Business Volume. Each eBIZ Package is
assigned Business Volume.
RV ( Retail Volume ) : Whenever Representative introduced a new Retailer and Retailer buys
products from Retails section, Representative and his / her 3 level upper Sponsors earn Retail
Volume. Each and every Retail product is assigned the respective Retail.

51. When PV (Personal Volume), BV ( Business Volume ) , RV (Retail Volume ) gets

credited ?
Answer: It will be credited after competition of cancellation period of various purchased
products.

52. I wanted to join eBIZ directly as Representative only. How to join ?

Answer: NO, You cannot join as eBIZ Representative directly. First you have to sign up as
Retailer and only after accumulation of 10K PV you can become Representative.

53. What are Purchase Price, MRP and Selling price of our products available in Retail
section?
Answer: Purchase Price : The price on which Retailer / Representative buy products from
eBIZ.
MRP : Maximum Retails Price of any products as listed against each and every product.
Retailer / Representative not allowed to sell product above MRP.
Selling Price : The price on which Retailer / Representative sell any products to their
customer.

54. I am Retailer of eBIZ, How I can get commission under Retail as well as Group
compensation plans?
Answer: No, If you have joined as Retailer, you will not be eligible for any type of
compensation plan. Only Representatives are eligible for Group as well as Retail
compensation plans. However, you can buy products available online in our product section
at discounted price and sell these product on or below MRP and earn the difference.

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55. I am Retailer of eBIZ, Some of my knowns are interested to join eBIZ, I am unable
to find option to introduced these people?
Answer: If you are Retailer then you are not eligible to introduce any Retailer /
Representative.

56. I am an eBIZ Retailer and want to purchase eBIZ products at Retailer�s price and
further sell to the customer upto the max of MRP or below as listed by eBIZ, can I start
doing this just immediately after been sponsored ?
Answer: Yes you can but subject to sending ACCEPTANCE FORM duly signed by you
which should be signed by your sponsoring Representative as a witness as well within 10
days from the date of your registration. If we not receive the same within 10 days your
position will be put on hold and you will not be allowed to buy any product from eBIZ and
do any further business.

57. I have not received my purchased eBIZ Product. What can I do?
Answer: Please contact us at https://support.ebizel.com with your product purchase details, If
you not received your purchased eBIZ Product within 60 days from the date of purchase.

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