The Pyramid Scheme: How to (not) get rich quick.....
At my first party for a popular makeup line that will remain anonymous, I was asked to fill out a survey after the presentation. One of the questions was, "How interested are you in the product?"

As a college student completely naive to the workings of a pyramid scheme, I checked a 4 out of 5.

After the surveys had been collected the spokeswoman called to the front several people who had been "randomly selected" to receive prizes. I was excited to be among those winners and eagerly claimed my sample-sized lipstick.

The representative then told the group to give us a round of applause because we had put a 4 or a 5 on our surveys. That meant we were ready to join the company and start our own businesses!

Confused, I listened as she explained that all we had to do was buy our starter kit and we would earn our money back a hundred-fold with nary an effort on our part. We would soon find ourselves swamped with orders and eventually have dozens of representatives working under us. Additionally, within six months we would have earned a brand new car free of charge. We would also keep 50 percent of what the company made off our orders.

The proposition of driving a free car and earning money without actually working for it piqued my interest. I asked a lot of questions and received very encouraging answers. I could sell at my own pace and if I wanted to order just one eye shadow for a customer I could do so at any time. And if I wanted to order a hundred eye shadows I could do that too. It was completely up to me.

I called my boyfriend and excitedly told him about the party. He was dubious at first, but after I mentioned that I would be driving a free car within six months, he got excited too. So I signed on the dotted line and handed a $100 check to my new team leader.

Three days later a huge box full of supplies arrived in the mail and I tore it open, rummaging through the makeup, order forms and samples. The instructions were easy enough: Gather a group of women together and the team leader would run my first party and make my first sales for me.

Unfortunately as soon as I mentioned the name of the company to my friends, the smile on their faces disappeared and they sniffed, “That stuff is way too expensive,” or “I’ve tried that. I’d rather buy my makeup at Wal-mart any day.” Chagrined, I scoured the catalogue and the prices that hadn’t seemed too bad before now leapt out at me.

I was able to finally persuade five or six loyal friends to come to my debut party, lured by the prospect of free stuff. My new friend the team leader drove to my house - incidentally not driving a company-issued car - and wowed the small audience with her descriptions of the wonderful products they were about to use.

After my friends had removed their makeup they were given minute portions of creams, lotions and makeup to try. Instead of exclaiming in excitement over the product, they laughed at it and made fun of the way it felt on their faces. One by one they came up with excuses to leave the party and my team leader was able to persuade only my roommate to stay and listen to her spiel with the promise of a free eye shadow duo.

Later, my team leader told me that if I’d had more product on hand to show the attendees that the party would have gone much better. Although I had been under the impression that my starter kit was product, I was promptly informed that it was to be used for demonstrations only. I should have bought myself an inventory to have on hand to sell to my customers instead of their having to order from the catalog. I was floored by the cost of the various inventory packages. A “satisfactory” inventory cost at least $900 but the representative “really recommended getting a much larger package.” That way my customers would never have to wait! Ignoring my protests of poverty, she pulled out her company credit card and told me how easy it was to open a company account and pay off the cost - plus interest - in easy increments. Having very recently shouldered a hefty student loan, I put my foot down and declined the inventory for the time being.

Determined not to let my first party discourage me, I walked up and down my dormitory halls handing out fliers and samples. I was daunted at the number of girls who either already had a company representative or were one themselves. I had a lot of competition.

Meanwhile I went online to set up my Web site, where I was met with the announcement that I would be charged $20 per month to maintain my site. After my team leader found out that I was opting not to get a Web site, she told me in no uncertain terms that I was a fool not to pay for the site and personalized company cards and hung up.

Although I was getting nervous about my 'business', one of my dorm-mates encouraged me by placing a $20 order. That would mean that I would be keeping $10 for myself! I went online to submit the order and faced another error message. I called my team leader and she very kindly informed me, much too late, that I had to submit a minimum $250 order every quarter - wholesale, before sending in smaller orders. Because wholesale was half the price my customers paid I had to persuade them to order $500 in product before I could submit my order.

Two or three other girls ordered a few things each and after two months of hearing, “So where’s our makeup?” I begged another representative on my floor to let me combine my order with hers. Out of the kindness of their hearts three of my aunts ordered a month’s supply of makeup and facial products each and that quarter I earned back the cost of my starter kit plus an additional $10.

The reminder of a free car kept me from quitting cold and I cheerfully continued giving free facials to anyone who was brave enough to try them. The sale of a $50 microdermabrasion kit before the end of the quarter made me giddy with excitement. Unfortunately the beginning of the next quarter loomed before me - and I had yet to make a sale under my own name.

My team leader let me know that she was tracking my orders and was less than happy about my sales. What happened to this being my own business?
A girl on my hall approached me about becoming a representative herself. Since she was my friend, I hesitated about signing her. But my team leader was thrilled and told me that if Andrea joined the company I would be one step closer to getting my car. I would also receive 5 percent of Andrea’s proceeds. Then she winked at me and said, “But just don’t tell her about the quarterly limit until she’s already signed.”
I immediately hurried to Andrea’s room to talk her out of signing.

A month later I was still giving facials and placing my small orders under my friend’s name. Then I was given a tidbit of information that became the proverbial “straw that broke the camel’s back.”

After causally asking my representative again about the steps to earning a company car, I was nearly brought to tears by her reply. “Oh you have to have at least 18 representatives join under you with at least nine people under each of them before you get a car,” she said. “And after that you have to make a minimum $18,000 one-time order to be eligible.”

As I hung up the phone I looked at the small pile of makeup that was left over from my starter kit. I sent a free foundation and lip gloss to each of my faithful aunts and gave the rest to my mother and sister in their stockings at Christmas.

I sent a cancellation e-mail to my team leader. She sent me back a short and swift reply: because I had cancelled my business I could never, ever ever sell that product line again.

That's ok. I will never, ever ever be talked into a pyramid scheme. Ever again.


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