Fraudulent activities are truly common these days; the number is high in business. Thousands of people in India fall for such frauds, young and older people alike. The worst part is that these activities cause trouble in honest businesses too. That’s what is happening with the direct selling business. Many people misinterpret this legit business for fraudulent schemes. In many cases, such activities tend to claim as direct selling. However, there are some fundamental differences between direct selling and false schemes.
This article is motivated to share awareness about why direct selling have nothing to do with fraud schemes or businesses.
Direct selling vs pyramid schemes
First and foremost, to register and join a direct selling business, the interested people should buy the company’s product. So, there’s a clear exchange between the company and the direct seller. The distributor/seller is receiving products worth the money they spend. Then the direct seller can retail these products and make a reasonable profit. In other words, direct selling is a retail business carried out by a direct seller, who acts as an intermediary between the company and customers. It is a small-scale business plan with a good possibility of making a profit. What makes it so profitable is that to enter direct selling, one does not need to spend a lot of money. The less the cost, the higher the revenue is.
On the other hand, a pyramid scheme is a chain of people added under each new joiner. To join this chain, everybody has to pay a certain amount. However, in return for this amount, the people in this chain won’t receive anything. Unlike direct selling, it is not an exchange, so no products or return is received. But, in a pyramid scheme, a profit is being offered to all the joiners. However, what happens is that either the chain will break at some point because of no opportunity to grow. Or, the company would stop working abruptly, cheating the new joiners and only benefiting the owners and the first group of people who joined.
Direct selling vs get-rich-quick schemes

Plans, hard work, business skills, knowledge and more are important elements for the success of a business. In direct selling, strong marketing is required for product sales. To boost performance, one should implement new ideas and effective management. Similar to any other business, direct selling is hard work. Plan, skills and hard work determine success and growth. Direct selling differs from traditional business because it only requires low capital to enter the business. Neither a physical store nor advertisement, transportation or any such cost is needed.
However, as the name suggests, get-rich-quick schemes are fraud schemes that offer a profit from money one spends. There will be no legitimate businesses offering success or profit without hard work. It takes a lot of effort and time to succeed in direct selling and traditional business. If anybody comes with offers of easy money-making, then that’s is not direct selling. A direct seller will get paid reasonably based on product sales and network growth.
Direct selling vs Ponzi scheme
Investment schemes are different from direct selling. In direct selling, a person who wishes to join is not making an investment that would pay twice or more after a certain period. But it’s a business prospect; as I mentioned above, hard work is necessary to get the prospect into real success.
On the other hand, the Ponzi scheme is not a retail business like direct selling. It does not provide a product in return for the money one spends. Moreover, an investment or Ponzi scheme offers a massive profit from an investment. It then disappears from the people or benefits only people who joined in the beginning stages. It is very similar to a pyramid scheme, both of which are banned in India.
What exactly is direct selling?

Direct selling is a retail business with great opportunities in business. It best suits people passionate about entrepreneurship and willing to work hard. A direct seller will work as an intermediary between the customer and the company. A person can earn a reasonable income from this retail business. As the cost is less due to no requirement of a physical store or any such costs, profit is higher. Anybody can be a direct seller; it is the easiest way to enter the business world. Plus, direct selling is a great way to earn an extra income because a person can manage it with a regular job.
There are millions of direct sellers in India. Direct selling companies work under the Direct Selling Guidelines, 2016, issued by the Ministry of Consumer Affairs. The legally approved business is registered and operates under the Company Act, 1956. This business has been active in India for over five decades. In addition, one attractive feature of the business is the majority of direct sellers in India are women.
Learning about the fraudulent schemes would help one be indifferent and make the right choice. So, avoid fraud schemes and choose the best direct selling in India.











