Case Study : Pyramid Scheme Business (1)

By | 2014/03/01

Today is my forth time to meet this business model.

Always very interesting, no matter how many times I met.

※The contents written here are only for personal research based on personal experience. The contents here do not mean to humiliate, criticize any person or organization.

The strategy in this business model is so interesting, just like having evolved for such a long time. After all the company has a quite long history.

Here are some points in this pyramid scheme business.

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(1)  Earning lots of money easily

Although the concept is to share the distributing margin between manufacturers and consumers to consumers, this is not the reason why this pyramid scheme business earns money. The money comes from consumers actually and the true concept of this business model is nothing but earning money.

It provides a system for anyone who joins to earn money and make it LOOKS very easy to do it. Besides, most members from this business also say that it is VERY EASY to earn lots of money with this business model.

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However, I understand that it is truly difficult, just on the contrary to what they usually state. The reason is that the products are not cheap. For instance, a bottle of shampoo or detergent costs 1,000 Japanese Yen (10 USD) which is 3~5 times higher than the common products we buy in the shop on street.

With this high price, the members in this business model earn. If they introduce someone else to buy, they earn some from him/her. If they can ask others to sell to more people, they earn more, which is just like the name of this business: pyramid scheme business. So if they can make others keep buying their products, they can just earn money without paying any efforts.

Honestly speaking, I believe some people can earn a lot by doing this business. Even though, I also consider that only very few people can make it.

Just like some few people can earn lots from security market, some few people can become superstar in major league and some can raise a start-up firm to a global giant in a couple of years, there must also be some people can earn a lot from joining this business model, because they are good enough or work hard enough to overcome the difficulties to enter the success door.

Therefore, NOT everyone can easily pass the difficulties and enter the success door even in this business model.

(If it is true that everyone can easily earn lots of  money, most giant companies in this world should have been gone long time ago theoretically)

The more interesting point comes from next article tomorrow!

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