Top 5 MLM Dangers: The Worst Things That Can Happen

Today, I’m going to talk about the top 5 MLM Dangers. I will also talk about the “good and bad” of each of these dangers, just to give you some added perspective.

Our industry is a fickle industry. People either LOVE our industry like I do or they love to hate our industry. We are a misunderstood industry.

The biggest issue with our industry is that anyone can get involved. That is a blessing and a curse. It’s a blessing because anyone who wants to start a business of their own, but cannot afford the traditional business route, has an option here. On the other hand, it is a curse, because we do not have a screening process to weed out non-serious people.

In just about every other type of business model, there is a screening process. You either need a certain amount of capital to get started, pass certain background checks, get the required licenses, have the right connections, and/or find the ability to qualify for a loan to start your business.

With our industry, you just purchase a small business kit, sign your name to a distributor agreement, and in most cases, you are in business for less than $100!

mlm dangers

Top MLM Dangers

What you will see below are the top MLM Dangers, as I see it. They are listed in no particular order.

# 1: You Could Lose Time

Time is our most precious asset. You can always earn more money, but you can never get back your time. You might invest 1-2 years of your life working your business part-time and still fail. That is a possibility. You might invest even more time than that and never succeed or make money.

On the flip side of the coin, you could become successful and have time and money freedom. I know of no other industry the average person can participate in (for about $100) and have those opportunities. Plus, you could argue that you could lose your time in ANY business, not just network marketing. For example, I know bloggers who invested YEARS of their life and never made a penny. I know of traditional entrepreneurs who poured their heart and soul into their business and still failed.

Our industry is designed to do part-time. People are taught to have this as a side hustle and keep their day job! Never join network marketing and go full-time right out the gate! I would argue not to go full-time in any new business venture, unless you are properly financed and know what you are doing.

# 2: You Could Lose Money

The average person in MLM earns practically nothing. Then again, the average person in MLM does practically nothing to earn money with their business. Yes, you could lose the money you invested to start your MLM Business. Fortunately, with most companies that’s less than $100. That’s chump change compared to starting a traditional business.

You could lose money in ANY type of business. Traditional businesses cost substantially more, anywhere from $10,000 or more just to get started. I drive through my local town and see tons of closed down restaurants, thrift stores, and mom and pop businesses. I am 100% certain these folks lost money, and lots of it, but no one called their business model a scam!

When people tell me they went bankrupt because of MLM, I scratch my head. You shouldn’t be losing money. If it’s a few hundred dollars to start and your auto-ship is $100-$200 per month, how could that make you bankrupt? People who file bankruptcy because of their MLM Business did something wrong and did not do the business the right way.

It takes 20 years to build a reputation and five minutes to ruin it

# 3: You Could Lose Friends

This is one of the biggest fears for most people new to our industry. Let me tell you this. The only way you will lose your friends or strain relationships by doing MLM is if you do the business the wrong way. If you do it the right way, you have nothing to worry about.

You should never be deceptive, lie, use pressure or hype with anyone you know. Your only responsibility is to NOTIFY them of your new business. If they express an interest, you can give them additional information. If they do not express an interest, leave them alone and move on to the next person.

I know of many entrepreneurs who strain their relationships with friends and family because their business consumes all of their time. They spend less and less time with their friends and family and they grow apart. Or, they outgrow their old friends and find new friends.

I’m going to include divorce in this section. Some people blame their divorce on MLM. Maybe, in a few rare cases, that is the case. But, you could argue that the divorce rate is already quite high. In most cases, there were other issues that contributed to the divorce, not just MLM.

# 4: You Could Miss Out on Other Opportunities

For some people, this could be the biggest danger of doing MLM. You might miss out on other income opportunities. You might be so obsessed with your MLM Business that you overlook or even turn down other money making opportunities.

On the flip side of the coin, I have found many entrepreneurs who started with MLM and then evolved successfully into other non-MLM businesses. The skills you learn in this industry are easily worth at least an MBA (in my opinion). I think of MLM as the best business school around. You get free mentors and you learn by doing.

I’ve also found that you can’t chase two rabbits and catch one. Focus is paramount to your business success. Whatever business model you choose, it would be in your best interest to put your blinders on and focus on that one thing until successful.

# 5: You Could Fail

You could fail in your MLM Business. Most people do! But, the same holds true with most businesses. Most new businesses have a high failure rate, and these folks invested lots of money and time to start and grow their business.

I personally do not look at failure as a bad thing, if you learn from it. What happens in our industry is most people quit. In fact, most people quit within 30 to 90-days. I do not consider that failure. I consider that quitting.

What I have found is most people who develop their skills and put in the work over a sustained period of time do very well in our industry. The problem is most people expect instant gratification and are not willing to commit to their business for a sustained period of time.

The Flip Side of the Coin

The Flip Side of the Coin

So, we talked a few minutes about the top 5 most common MLM Dangers. I believe I would be doing you a HUGE disservice if I did not share the GOOD things that might happen to you.

You learn new skills. This industry is like a low-cost business school. If you immerse yourself, you will learn a ton of valuable skills that will benefit all aspects of your life. You will refine your leadership, sales, marketing, people skills, communication and team building skills.

You grow as a person. The personal development in our industry is second to none. How much is your personal development worth to you?

You earn your time and money freedom. What if you do succeed in MLM and earn back your freedom? How much is that worth to you? How many people do you know who truly own their life and do what they want each day?

You develop a stable, solid residual income. What if you succeed and build up a solid $1,000 to $10,000 or more monthly residual income that comes in for many years? Even if you don’t make it big, and go full-time, how would that money change your life for the better?

You make new friends! How much do you value a good friendship? What if you could meet, and form friendships, with new people you would not have otherwise met?

Final Thoughts

In conclusion, these are the most common MLM Dangers, as I see it. Nothing ventured, nothing gained. The blessing and curse of our industry is that anyone can get involved. MLM has changed my life in a good way, and I know it can have the same impact on you.

What are your thoughts? What do you believe are the biggest MLM Dangers? Leave a comment below to let me know what you think. I look forward to hearing from you.

chuck holmes


Chuck Holmes
Network Marketing Professional (since 2002)
Author, Blogger, & Entrepreneur

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2 thoughts on “Top 5 MLM Dangers: The Worst Things That Can Happen”

  1. I believe that one of our MLM dangers is that people don’t take the time to research the MLM company they are interested in which could potentially lead to the company getting a bad name when the person doesn’t succeed due to their own fault. People in general know very little about the business so in their mind, it’s all a Scam. Because of the misconception we either have people that turn their nose up to joining or if they do join, they have the 9-5 mindset which could be hard to break them of. Where I believe the MLM business is a blessing, is that there are so many people that are hard workers but they are not book smart. With an MLM you do not need a “big degree” to start the business or become successful.

    1. Yes, we have a lot of things to overcome. Many people join our industry out of desperation, and they join with an employee mindset. That is almost always a recipe for failure. Plus, people have been conditioned to work in a job their entire life. Many people have a hard time seeing an opportunity if it is NOT a 9 to 5 with a steady check and good benefits.

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