Is Karatbars International a scam or not? Some people have labelled this MLM company as such, but is that a fair assessment? Can people really make good money promoting investment in this precious metal?
Let’s take a closer look and see…
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Company Name: Karatbars International
Website: www.karatbars.com
Price To Join: €220 Minimum
My Rating: 3/10
~ Karatbars International Review ~
What Is Karatbars International?
Karatbars International was founded back in 2011. It’s a gold investment company that operates under the network marketing promotion model. Which means people can join Karatbars as distributors and earn money by promoting the company’s products.
That will be the basis of this review, but we’ll also briefly look at what Karatbars International offers in the way of products and services as well.
The company is based in Stuttgart in Germany and the investment and business opportunity is a global operation. Gold production is via Nadir Gold in Turkey, and all shipments are provided by FedEx.
Sometimes people are quick to label anything MLM (multi level marketing) a scam, but usually they are legit operations. It’s just that many people fail to make money with this business model, while for companies it’s an extremely profitable way to make revenue.
We’ll get more into the business side further along in this review, but now we’ll take a brief look at the products Karatbars International has to offer.
While you might make a profit with MLM, it’s a damn tough way to try and make a decent income. I much prefer the simplicity of affiliate marketing. If you want to give it a go, check out Wealthy Affiliate’s training. It’s FREE to join!
The Products
Basically this company is a gold reseller, and they offer a variety of gold bars under the following categories:
- Small Gold Bars
- Classic Karatbar
- Country Karatbar
- Collector Karatbar
- Special Karatbar
Because this operates as an MLM scheme and everyone gets paid a commission on every transaction, the price of the gold is a lot higher to buy than what the market value is. In fact, it costs almost double.
This fact alone makes it a very hard way to make a profit from a gold investment standpoint.
This leads me to believe that Karatbars is almost all about the business opportunity rather than a genuine gold investment opportunity.
The Compensation Plan
These compensation plans are always very complicated, making it hard to understand exactly how you make money or how much. However, they all basically function on two levels:
- Selling products directly
- Recruiting others into the scheme
MLM is set up in such a way that you really need to recruit big time to have a chance of climbing the company ranks and moving into the realm of earning decent money. Without recruitment, you really don’t get very far in any MLM venture.
There are a total of 9 bonuses you can earn, and they are:
- Double Income
- Direct Commission/Unilevel Bonus
- Generation Bonus
- Karatbars Pool
- Karatbars Gold Funds
- Packages Bonus
- Dual Team Bonus
- Premium Pool
- Premium Professional Pool
Karatbars use a unilevel compensation plan, which tends to be a little fairer to distributors than something like the binary style of compensation.
There are also quite a few ranks you can aim for, and as you rise up these ranks, the more chance you have of earning a better income from this.
You can read the official 39 page Karatbars International compensation PDF here.
I have also embedded their official video that explains how the compensation plan works, for your convenience.
The MLM Business Opportunity
The problem I have with MLM – and it applies to all MLM schemes, not just the one offered by Karatbars – is they are designed to totally favour the company running the show, while essentially stripping all benefits from its workforce, the army of distributors.
The reason so many companies opt for the network marketing method is because it saves them so much work and money. It’s a beautiful set up for companies, but in reality a woeful deal for the distributors.
The main reason so many people jump on board with opportunities in MLM is because everything is already established, and these companies are expert at selling the dream lifestyle, and also claiming that you will have your own business, when in fact you never own your own business when you join a MLM company. The company owns and controls everything, and you just get to pay them fees for the right to be their sales rep.
They essentially get a free workforce that does everything for the promise of commissions and bonuses somewhere down the track. Distributors are usually the main customers, forced to purchase products to remain eligible to earn.
They also do all the selling, promotion, and grow the business by the need to constantly recruit new members.
It’s really not a good deal at all, one of the worst deals there is, to be honest.
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Is Karatbars International An Illegal Pyramid Operation?
An illegal pyramid scheme is one that has no products and gets all its money from recruiting new investors. Karatbars International does operate on a pyramid structure, but as it has gold products, it cannot be classified as an illegal pyramid operation, despite what some might claim.
What I Like
- At least gold is different to the multitudes of MLM companies operating in the super saturated health and wellness niche
- Many people these days are turning to precious metals as investments, rather than just putting money in the bank or buying property
- The opportunity is a global one
- You get a replica website to help with sales and recruiting
What I Don’t Like
- The price of the gold is ridiculously high, kind of negating the very benefits of investing in gold in the first place
- MLM is one of the hardest ways to make money as a distributor
- You will be hard pressed moving any gold at a retail level when the prices are miles above market value
- This opportunity is more about recruiting and being forced to invest in gold products yourself as a distributor
- The likelihood of making money with Karatbars is very slim
- All the benefits go to the company and not its distributors
- Only the owners and those at the very top of the pyramid live the dream lifestyles companies like Karatbars openly promote
- Most people fail to make any profit whatsoever in any MLM scheme
How Much Does Karatbars International Cost?
The minimum amount to invest and get on board with this opportunity is €220. When you become a member you also receive your own replica website, which helps you to sell the gold packages, as well as recruit new members into your team.
Is Karatbars International a Scam?
I don’t consider Karatbars International a scam. It’s just your typical MLM scheme, but selling gold bars instead of health and wellness or beauty products, as so many others seem to do.
Apart from MLM being a really shitty deal for distributors, two other major problems I find with this particular company are:
- They charge way too much for their gold, making the gold rather useless as a genuine investment opportunity.
- Karatbars treats its distributor base as its customer base, selling most of its gold to its own workforce.
MLM of any kind is a really tough way to make money. You are always up against it trying to sell products that are way over-priced, and without constant recruitment of very active team members, you can’t advance up the company ranks, and that’s where the real money lies in MLM.
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Seriously, I’ve done my share of MLM in the past and it’s extremely hard work to even try and make some spare change, let alone make a fulltime gig out of it and replace the income from your current job.
These days I focus on the far more lucrative and simple business model of affiliate marketing. Let’s take a snap shot of just some of the advantages affiliate marketing has over multi level marketing:
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- No need to recruit others in order to make great money
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- No buying, selling or shipping of products
- No promoting of over-priced products
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Affiliate marketing has it all over multi level marketing in so many ways that there simply is no comparison.
If you are looking for a genuine money making opportunity, then I suggest forgetting about anything to do with MLM. You’ll likely spend a whole bunch of time and money all for no result. Affiliate marketing is so much better and far more profitable.
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Darren Burton
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