What difference is Amway different from a pyramid scheme?

Question by han: What difference is Amway different from a pyramid scheme?
how are the two different? both are multi-level marketing. Amway seems to have established itself as a legit business.

Best answer:

Answer by flingebunt
Network marketing perfect legal while pyramid schemes are not.

Pyramid schemes involve no product other than the scheme itself.

Amway, herbalife and the numerous other network marketing systems, have a product and encourage people to sell the product. But mostly they make the money by bringing people into the network marketing scheme, just like a pyramid scheme.

Generally people join the scheme, sell no products and make no money. However the sale of the products do happen. Often products go through 3 phases. Number 1, network marketing, 2 direct sale on late night TV, then finally they turn in stores. So even though network marketing is somewhat unethical and the sales techniques they use border on illegal, they do in fact serve to bring products into the market place.

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