Kleeneze

Kleeneze Homecare is a multi-level marketing company, and was started in 1923, in Bristol, England. The founder, Harry Crook, had emigrated to America with his family several years earlier and while there joined Fuller Brush as a sales representative. He returned to Bristol several years later and started his business making brushes which were sold door to door by salesmen.

During the war years of 1939-1945, women were encouraged to become salespeople while the men were away fighting.

Since the 1980s, Kleeneze has offered a different approach, by using catalogues to sell over 2500 products. Now each Independent Distributor only needs to deliver those catalogues to householders in the area where they live. The distributor then delivers the products several days later.

The company remained at its original site for almost 80 years, but in May 2004 relocated to its brand new office headquarters and distribution centre in Warmley, Bristol to cater for future growth and expansion into Europe.

Kleeneze was a founder member of the Direct Selling Association, and is also the oldest network marketing company in Europe, having started its networking operations in the 1970s. Kleeneze also works closely with the Neighbourhood Watch Association.

After trading for over 80 years throughout the United Kingdom, expansion of its Network Marketing business program into Europe started with the Republic of Ireland, followed by the Netherlands in 2004 and Germany in 2006.

Multi-Level Marketing

Multi-level marketing (MLM) (also called network marketing or NM) is a business model that combines direct marketing with franchising

Overview
In a typical multi-level marketing or network marketing arrangement, individuals associate with a parent company as an independent contractor and are compensated based on their sales of products or service (as well as the sales achieved by those they bring into the business).

In a legitimate MLM company, commissions are earned only on sales to the end-user, who is often also a distributor. No money may be earned from recruiting alone ("sign-up fees"). Some companies produce revenues primarily by attracting new participants or selling them marketing services, as opposed to selling actual products. One must analyze the compensation plan to determine whether participants are paid from actual sales to customers and not from new-recruit bonuses or business support sales.

Multi-level marketing has a recognized image problem due to the fact that it is often difficult to distinguish legitimate MLMs from such illegal scams as pyramid or Ponzi schemes. NM/MLM businesses do operate legitimately in all 50 U.S. states and more than 100 other countries, and new businesses may use terms like "affiliate marketing" or "home-based business franchising."

History
Amway in particular is a frequent target for critics for generating considerable revenues from selling instructional and motivational materials to its participants. The FTC filed a lawsuit against Amway in 1976. Amway's victory paved the way for companies to adopt a multi-level distribution system.

The 1980s saw a major shift as companies began managing the stocking and distribution of products as well as commission payments to their members. This allowed members to focus solely on marketing. Today, most MLM companies act as logistics companies that take orders, ship products and calculate and pay commissions.

Compensation plans

Companies have devised various MLM compensation plans over the decades.

Unilevel or Stairstep Breakaway plans are the oldest and most popular. They feature two types of distributors -- managers and non-managers -- and three types of pay:
Baseshop overrides are overrides of managers from their subordinate non-managers, collectively called a baseshop. This is the same as any other sales organisation.
Generational overrides are overrides of managers from the baseshop of managers who were previously their subordinate. Most plans compensate at least three generations of such managers.
Executive bonuses are commissions for managers who exceed a sales quota. For example, 2% of the total company sales revenue may go to a bonus pool that is shared monthly pro rata to managers who exceed $10,000 in that month.
Matrix Plans limit the width of each level in a distributor's group, forcing strong distributors to pile ("spillover") their recruits over people who did not sponsor them.
Binary plans limit the width of each level to two legs. Commissions are based on "cycles," where a distributor is paid a fixed amount whenever both legs achieve a certain number of sales units each. Commissions are paid incrementally when the sales volume in each leg matches.
Elevator or Matrix schemes feature a game board or a list on which each distributor pays in one or more product units to participate. When a certain number of units have been paid in, the structure splits and the earlier participant receives consideration. The Matrix scheme article discusses the legality of this plan. You must do your own research as with any other investment.

Fraud in MLM

Fraudulent MLM schemes can usually be identified by high entrance fees or requirements to purchase expensive inventories. They often collapse quickly when the merchandise cannot be resold, leaving all but those at the top of the pyramid with sometimes staggering financial losses.