One of the biggest pushback faced by top direct selling companies in India like QNET is that they get compared to pyramid schemes. If you have ever told your friends about joining QNET or asking them to join it, then there is a chance that they would have told you that it was a pyramid scheme. But is there any truth to this claim? Is QNET a pyramid scheme? Or is it just misinformation and a misguided problem? Let us take a look.
What is a Pyramid Scheme?
Almost all of us must be aware of what a pyramid scheme is. For those who might be aware of it, I will reiterate. Pyramid schemes are sketchy and unsustainable business models where only the people on the top make money while the ones at the bottom lose out!
The main objective of pyramid schemes is to get more and more people into their business. The new recruits have to pay an initial fee and has to recruit more people into the pyramid scheme. This initial fee is used to pay off older members. The pyramid scheme gets its name from the fact that it starts to takes the shape of a pyramid. The problem arises when the number of new recruits runs out. The scheme fails, and the people who invested in the business lose their money! I have already talked about the signs that will help you to recognise a pyramid scheme and stay away from it.
Is QNET a Pyramid Scheme?
So let’s go back to our initial question. So is QNET a pyramid scheme? Well, no. Obviously! QNET is a direct selling network marketing business that deals with the sale of high-quality products directly to the customers. The main factor that makes direct selling network marketing business from pyramid schemes is that the former deals with the sale of products and is not just about recruiting people. While recruiting new members to your sales team can help you to grow your business, it is far from the main objective. The focus is always on selling more products. Having a bigger sales team just makes it easier. QNET is a company that has over two decades of history. Just this fact is enough to negate the question about the legality of the company.
So why the Confusion?
Now that you know how QNET is different from a pyramid scheme, you might ask – why the confusion? What makes people think that QNET is a pyramid scheme? There is no single answer to it. This could be due to misinformation or by people deliberately trying to mislead people. Another factor that has led to the misconception is the fact that pyramid schemes always try to convince people that they are direct selling network marketing businesses like QNET. But they are nothing alike. One is a legitimate business that is legal and taxed in India, while the other is a scam that is outlawed in the country.
I hope that I was able to convince you how a direct selling company like QNET is different from a pyramid scheme and why you should be careful of the latter. If there are any other topic or questions about direct selling and QNET that you want me to cover next, feel free to contact me through the comments below.