MLM critics charge that MLM leads to saturation. But how can that be when MLMs are constantly growing without ever reaching saturation?

MLM compensation plans reward the recruitment of an endless chain of participants into an infinitely expanding network – but in a finite marketplace. They are therefore destined to market saturation, and MLM promoters must be continually recruiting to replace a revolving door of participants who drop out at a rapid rate. MLM promoters who claim that saturation never occurs are referring to total saturation, which never would or could occur.

It is absurd to assume that in a city of 100,000 people, 100,000 MLM distributors would be needed. The city may accommodate 10 or 20 distributors before the market is saturated, in that each new recruit would find it tougher and tougher to recruit more participants. So it is market saturation, not total saturation that is relevant to the analysis.

To illustrate an extreme example of saturation, in a randomized survey of households in Utah County, which leads the nation in sponsorship of MLMs, there were four MLM distributors for every one customer ...

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