I am finally relieved that I have finally finished writing 61 chapters, and the theoretical analysis of Meilu since chapter 55 can basically come to an end. I've been writing this section almost since February 2010, and although there are only 7 chapters, the chapters are so complex and involve a lot of data that needs to be verified, which is really a bit overwhelming. The reader "years" is right, my background is not enough, and it is reluctant to write emotional words.

But this part is indispensable throughout my series, and the overall structure was planned at the beginning of writing in October 2009, but I didn't expect to write more and more, and it was out of control. Some readers suggested that a special chapter could be devoted to detailing the similarities and differences between Meilu China and Meilu overseas. To be honest, I know Meilu China very well, but Yumeilu overseas is the skin, if you carefully argue it, it is just a smile and generosity. In fact, there are only slight differences between Meilu China and Meilu Overseas, and there is no difference in essence, except that the social negative effects of Meilu China are greater, and there are more direct sales refugees. Compared with overseas, the chaos in China is more complicated, and the reasons are nothing more than the following four reasons:

1. Meilu China is not as standardized as Meilu overseas in terms of relevant mechanisms

For example, the return mechanism. Meilu China is a conditional return within 30 days: return unopened products within 7 days of purchase to get a 100% cash refund, return at least half of the remaining products can get a 50% cash refund; If you return the above products within 8~30 days after purchase, you will get 100% and 50% of the e-purchase coupons respectively. Among them, nutritional products are not allowed to be returned! In most overseas countries, Meilu returns unconditionally within 90 days, that is, even if there is only one empty bottle left within 90 days, as long as you say that I am not satisfied with this product, Meilu will also refund 100%. The reason for this discrepancy is that Meilu China claims that some people use the 90-day unconditional return mechanism to maliciously return goods. For details, please refer to the return turmoil at the end of 1996 and the beginning of 1997.

For example, the buyback mechanism. Meilu Overseas stipulates that all franchised direct salesmen can choose to withdraw freely within one year, and when they exit, the direct salesmen can return all the inventory that still has sales value in their hands, and the company must fully repurchase it. On the other hand, Meilu China has no relevant mechanism at all, and there is no precedent for other companies to buy back inventory.

For example, the principle of vending. There is such a provision in the Overseas Code of Conduct of Meilu that Distributors must sell more than 70% of the products purchased each month in order to enjoy the right to receive bonuses and award recognition. But unfortunately, there are no relevant regulations in Meilu China, which is one of the reasons why Meilu people are hoarding goods aggressively - if they think that they can make a lot of money by fooling the team to hoard goods and go unpunished, then most of the senior leaders of Meilu are willing to defy the law.

For example, the dealer mechanism. In addition to making Meilu China more justified, it is harmful to direct sellers, which not only increases operating costs, slows down the return of income, but also induces a lot of hoarding in order to meet the dealer qualifications as soon as possible. However, Meilu Overseas does not have this mechanism, so even if you are a customer in Meilu Overseas, you may make a little money, but Meilu China is not good, and if you can't become a dealer, it means that you don't have team ownership, and naturally you can't get team compensation!

In fact, the return mechanism and inventory burden of marketers have always been at the core of direct selling laws in various countries. Isn't there a lot of people in the United States who say that Meilu is legal overseas, and even bring out the case of the United States about the identification of Meilu as a non-pyramid company, so let's review the famous lawsuit that lasted for 4 years about whether Meilu is a pyramid company.

In the four years at the end of the 70s of the 20th century, the FTC repeatedly determined that pyramid companies had the following characteristics:

(1) Distributors have to pay a large joining fee (commonly known as hunter head fee);

(2) The Distributor purchases a large number of goods (commonly known as inventory burden), and these goods cannot be returned;

(3) In exchange, the distributor earns a commission by developing the downline.

In the end, Meilu Company was judged not to be a pyramid company because:

(1) There is no requirement for the distributor to pay the head hunting fee;

(2) The direct seller has no inventory burden (the principle of sales, that is, 70% of the direct seller's purchase in the current month must be sold to the end consumer);

(3) The distributor did not receive bonuses through the development of downlines;

(4) Unsold sellable goods in the hands of the distributor can be repurchased by the company within one year.

On the other hand, we can think about Meilu China as follows:

(1) Can the initial stocking (net amount of 1600~80,000 yuan) after the newcomer joins be regarded as a disguised joining fee?

(2) the principle of sales does not apply, and there is no system guarantee for the inventory burden company of Meilu people;

(3) The monthly performance of Meilu people mainly comes from the performance of existing departments, the initial stocking of newcomers, the replenishment/stockpiling of personal products at the end of the month, and the self-use of personal products. Don't Meilu people often talk about "making people out"? I wonder if this can be seen as a direct seller getting commissions through disguised downline development?

(4) For those newcomers who are still ignorant and ignorant in Meilu, is the hesitation period for conditional return within 30 days too short to be meaningless? As for the repurchase within a year, it is impossible to talk about it!

Compared with the above, I wonder how many of today's Meilu China and its market operation can meet?

2. Overseas developed countries have stricter regulations on direct selling than in China

In 1983, the Foreign Trade Bureau was found guilty and fined $25 million, the largest fine in the country at the time, for tax evasion and defrauding customers. Subsequently, in 1989, Miro paid another $45 million to settle the lawsuit filed by the Trade Board.

At the end of the 70s of the 20th century, after more than four years of investigation, it was finally ruled that Meilu did not belong to the pyramid company, but ordered Meilu to change some business operation models. If Meilu is forced to stop counting direct salespeople as customers, it is strictly forbidden to use these business practices to mislead direct salespeople about the amount of profits that may be derived from their operations. Meilu was required to comply with the above statement by each of its direct salespeople, indicating that more than half of its direct salespeople had limited incomes and that the average salary of direct salespeople was $100 per month. In 1986, in flagrant violation of the mandatory order, Meilu continued to falsify data and was sued for false advertising, and Meilu was eventually fined $100,000 for violating the statement.

The most recent dispute is in the UK. In 1973, Meilu entered the United Kingdom, which was the first overseas market opened up by Meilu in Europe, and it was also the first overseas country of Meilu's global expansion. In 2007, the 34th year of entering the UK, the United Kingdom encountered a crisis.

In November 2007, the UK Department of Trade and Industry made the decision to postpone the trial despite the drastic changes made by the United States of America and the United Kingdom, insisting that the closure of the United States Road Britain business was the best option.

On 14 May 2008, the UK High Court dismissed the UK Department of Trade and Industry's charges against the United States. At the end of January 2009, the UK High Court issued a final ruling accepting the reforms and the treatment of weaknesses by the United States, and allowing the United States to continue to operate in the United Kingdom. Although the court dismissed the relevant charges, the evaluation of Meilu was still very harsh. The court believes that this investigation is enough to warn Meilu: multi-level direct selling will cause great risks if it is not well controlled!

The U.K. lawsuit confirms a common problem facing the direct selling industry, and even a top direct selling company like Miro can operate in a regulated market like the U.K. for 36 years, and its multi-layered business model is still seriously questioned. Although the UK Department of Trade and Industry investigation started with the direct seller, the UK Department of Trade and Industry also confirmed the regulatory responsibility of the United States. In an unregulated market environment like China, this regulatory challenge will only become more difficult. The lesson learned from the multi-layered battle in the United Kingdom is to control the behavior of distributors more strictly, to hold themselves to higher standards, and to face difficulties head-on rather than run away from them.

In the United States two years later, another protracted dispute in the origin and base camp of the United States also shocked the world. Meilu was charged with fraud and paid up to $150 million in damages......

This huge judgment has broadly placed a big question mark over the correctness of the Direct Selling Association's "Code of Ethics" and the legitimacy of all other MLM companies based on the Meilu model as viable "business opportunities." In the class action lawsuit, which resulted in Meilu agreeing to pay $150 million, Meilu was found that:

• Meilu is an illegal pyramid scheme, and the head office of Meilu that sells incentive and training products to marketers is also an illegal pyramid scheme;

• Meilu violated the Federal Fraud Act;

• Meilu violated California's "Endless Chains Act";

• Miro claims that it is complying with a 25-year-old federal ruling in an attempt to cover up its crimes, when in fact it has not complied with the ruling;

• Merro lures salespeople into buying hundreds of millions of dollars in ultra-high-priced products and useless tools for success, and then recruits new people in the same way, which is designed to be endless, and almost everyone suffers;

• Meilu deliberately deceived consumers into participating in pyramid schemes, during which they would inevitably suffer property losses;

• The arbitration clause is intended to prevent victims from suing it for unfairness and unreasonableness;

• Meilu has committed telephone scams and email scams.

The key point of the lawsuit is the accusation that Meilu misled consumers with false income statements and promised "business opportunities". The "Alert Pyramid" analysis of the fees paid to dealers by the "Alert Pyramid" shows that more than 99% of the dealers contracted by the company have never made a single profit. When the actual costs such as the associated "tools for success" are taken into account, the estimated loss rate is around 99.9%. This 99.9 percent loss figure corroborates the tax data collected back in 1980 when the state of Wisconsin sued the United States, as well as data collected by the British federal administrators who sued and tried to shut down the United States a few years ago.

According to the ruling, Meilu will have to redefine its "revenue disclosure" to make it clear that the figures provided to consumers are only "gross revenue" and not net income, indicating that it is not a profit and does not reflect the costs that consumers would have to pay when they operated. You know, the "average income" advertised by Meilu is only an "average" average, not a middle number, which is raised by the high income of a very small number of people at the top of the pyramid. Such an inflated "average" can also mislead consumers into believing that ordinary MLM workers can actually make money, thus masking the fact that the vast majority of people do not earn commissions or net profits at all.

Meilu concealed these catastrophic losses, which totaled billions of dollars over a long period of time through carefully planned transformations and rationalizations. But the most effective means of deceiving people is their ability to influence politicians and take turns silencing managers. The lack of government regulation, along with sophisticated PR maneuvers and misleading revenue figures, gives MLM a legal aura and strengthens their ability to deceive practitioners and the media.

3. The system operation ideas of Meilu China and Meilu Overseas are slightly different

I don't know exactly how it works in other countries, but I'll take the example of the Canadian N21 system that I know: in Canada, there is no center that works, and every American organizes or attends at least one family gathering a week, and once a month participates in a regional Success Ridge. The Chenggong Ridge is organized by high-level leaders, and is generally within a radius of 4 hours by car, and it is usually not visited in any further places, which is not the same as the meeting footprint of the Meilu China Southern Expedition and Northern War.

In addition, in the United States and Canada, the hands-on leader will usually help you make an elephant leg first, which is commonly known as a line. Your start-up will continue to put the newcomers you recommend on a line under your name, and you will do the same. For example, if you → get started, you → A→ B→C→D, among them, A and C are likely to be recommended by your leader and hung up in your name, while B is recommended by you personally, and D may be B's friend. The existence of an elephant's leg at least ensures that a newcomer can see money with a little effort, thus further consolidating the newcomer's confidence in sticking to the American road, and of course, the newcomer is not easy to "die". Many Meilu high-level executives will use the line every time they go to a country to open up the market, which can maximize the market survival rate, and it is also the practice of overseas Meilu, but it is not clear why the senior executives gave up this method when the Meilu China operation was carried out later, and the dealer mechanism implemented since 2003 is no longer conducive to the implementation of this practice.

4. The specific circumstances of developing countries

China is the world's largest developing country, with the world's largest population, and the world's greatest demand for success. Many social factors are glued together with the multi-level model, and its chaotic phase can be imagined. In the U.S., a DD household earns about $1,000 a month, which is not even as good as a part-time worker who washes dishes in a restaurant. Even when it comes to diamonds, they are at the bottom of the middle class, far inferior to social backbones such as doctors and lawyers. In China, such income is still quite demagogic. Thinking of ten years ago, having a car and a house could make our eyes widen, but today we can only be dumbfounded. When traveling overseas, if an overseas American passerby learns that you are a diamond, then he will definitely give you a thumbs up - it is not easy to become a diamond with such a high consumption in overseas developed countries, let alone in developing China. Why does Meilu account for half of the 67 crown ambassadors in the world? Think about it, is it just because the market is big?

Many of the above can be regarded as throwing bricks and attracting jade, and I believe that there are still masters in the rivers and lakes. From the discussion of the system in Chapter 55 to the similarities and differences between China and overseas in this chapter, the theoretical analysis has come to an end, and many of these thoughts are of course not achieved overnight, this is a long process of thinking from the full strength of the United States Road to the departure of the United States, and even I am more sober about the various aspects of the United States Road now than at the beginning of the writing-writing is itself a process of self-combing. It's a pity that too many American passers-by pay attention to their goals every day, and they won't have the time and opportunity to systematically organize themselves.