Pyramid schemes are one of the ways people scam other people. In other words, that’s how they trick you to give away your hard-earned money. So it’s a good idea to get informed about these kinds of scams so you don’t lose your money. The question is, how do we know if a company is a pyramid scheme, and whether Oriflame is one of these schemes?
What is a pyramid scheme?
In a pyramid scheme, there is no product or service. When people join pyramid schemes, most of the time they put money in it, but they don’t get any product or service in exchange. The money they get from new recruits is distributed to people who joined the pyramid earlier. Once they can’t recruit any more people, there is no money going in, so naturally, the pyramid collapses, and that’s when a lot of people lose money.
It’s important to know that pyramid schemes are completely illegal. That’s why sometimes companies create a “fake” product or service to make the system a “legal pyramid scheme”. These “fake” products and services can be any useless thing that people wouldn’t buy in normal circumstances. For example, the newest pyramid schemes are cryptocurrencies.
How to recognize pyramid schemes
First of all, you can recognize a pyramid scheme by looking at the product or service the company sells. Many times, there isn’t a product at all. But even if there is a product or service, ask yourself the question: Would you (or anyone else) buy this product in normal circumstances? For example, if you see it in a regular store. If the answer is no, if you only buy the product to join the company in the hope of earning money, then there is a chance that it’s a pyramid scheme. It’s just common sense. If you don’t think that they are selling a useful product, then you probably shouldn’t join.
Another thing you can check is the age of the company. Companies that are running pyramid schemes don’t last long. They work for a few years before the pyramid collapses. If the company is too young (less than 5 years), you should be more careful with it. On the other hand, if the company is working for decades, there is a lower chance that it’s a pyramid scheme.
The third thing about pyramid schemes is that you usually need to pay a high fee to join. That high fee can be anything from $500 to tens of thousands of dollars. This is why pyramid schemes work for a while. Because if new people pay a lot of money when they join, then the owners don’t need to recruit a lot of people in order to make big money. If new recruits join with $10,000 then they only need to recruit 10 people in order to make $100,000.
Is Oriflame a pyramid scheme?
Oriflame is not a pyramid scheme. Here is why. First, Oriflame has products that are used by millions of people. While Oriflame offers money-making opportunities, there are a lot of people who only join Oriflame to order products for themselves. That’s the best sign of a healthy company. People would buy Oriflame products even without the money-making opportunity.
Secondly, Oriflame is not a young company. In fact, it’s one of the oldest direct selling cosmetics companies on the planet. Oriflame was founded in 1967, so it’s a 54-year-old company, and they are represented in more than 60 countries around the world. Pyramid schemes won’t last that long.
Thirdly, you can join Oriflame without having to pay a high fee. In fact, there is only a tiny registration fee (sometimes it’s even free to join!), but other than that, you don’t have to pay a fortune to join. That is another sign that it’s not a pyramid scheme. People only make money with Oriflame if other people are buying the products, and NOT because new recruits pay a huge amount of money.
So it’s important to be skeptical about money-making opportunities, but it’s actually very easy to spot a pyramid scheme if you know what to look for. They usually don’t have any real products, or they use fake or virtual products (like cryptocurrencies), and usually, they also require new recruits to pay a high fee when they join because that’s how they make money.
Oriflame is not a pyramid scheme because millions of people buy the products, regardless of the money-making opportunity, and we also know that Oriflame is one of the oldest direct selling companies on the planet.