I think this is without doubt the single biggest question anyone asks regarding Utility Warehouse.
It was certainly at the forefront of my mind when I first saw the business and my initial research led me to a brick wall of current distributors for the company using Utility Warehouse Scam as a SEO term to get hits to their websites and then proceeding to sing the praises of the company over and over again repeating the mantra that it wasn't a scam it was a FTSE 250 listed company again and again....
So
Is Utility Warehouse a scam?
The answer is no, its not a scam. It is indeed a legitimate UK company traded in the name of their parent company Telecom Plus on the London Stock Exchange in the FTSE 250 (The 250 biggest companies who are not traded in the FTSE 100).
Its shares currently (as of March 2013) are doing extremely well and are rising at a very impressive rate.
These facts are hammered home to every distributor with almost religious zeal. People who have absolutely no knowledge of the stock market whatsoever will suddenly start muttering FTSE 250 to their friends and family.
Is it a Pyramid scheme?
No pyramid schemes are illegal and Utility Warehouse is traded on the FTSE 250 (notice a pattern here) and has one numerous awards from Which? Magazine. It is a legitimate business.
So everything is fine with Utility Warehouse????
The problem with Utility Warehouse doesn't actually lie with Utility Warehouse the problem lies with Network Marketing or Multi Level Marketing in general.
Whilst the company is successful the vast majority of people who become involved in the business will earn nothing or next to nothing from the business.
Along the way however they'll be bullied, pressurised and indoctrinated by their upline* to pitch the business to their friends and family (who are suddenly referred to as a warm list) which leads to people devastating relationships. Very few people appreciate being sold to by their friends and family and when suddenly someone contacts you and starts high pressure sales techniques for household utilities it can be nothing short of catastrophic to a relationship.
I should stress this isn't specific to Utility Warehouse, this is in the very nature of Network Marketing. From the research i've done Utility Warehouse is by far one of the best companies in the network marketing field but that doesn't change the damage thats done by the way in which the business is marketed.
*Upline refers to anyone who has a direct financial interest in you promoting the business, so this could be the person who brought you into the business or the people above them. Within Utility Warehouse the upline structure tends to be very strong and my experience was that there was incredible pressure placed upon anyone who showed any ability whatsoever in the business by their upline.
This represents my own personal experience of Network Marketing and you should use your own judgement about any business opportunity you are presented with. My only advice to you would be, do your own research!
I'll be covering more specifics in later blog posts.
