I think my experience with both of these models can answer that question.
Here’s a little story. Years ago I sold a perfume company that I had founded and managed. Looking around for my next venture, I happened to meet up with some individuals who were immersed in a particular multi-level marketing (sometimes called network marketing) company. These same distributors/sales agents decided that since I was an expert in the personal products and beauty industry that I would be the ideal person for the multi-level company they represented. Most of the company products were in the personal care and nutrition area.
I attended a few of the rah-rah meetings where someone would stand up and tell how they were living at the poverty level and thanks to their enlisting in the aforementioned company , they were now driving around in expensive sports cars and earning 6 figure incomes.
One comment which I heard several times is that I would be buying into a company like a franchise but it would cost much less money. I would like to completely debunk the notion that companies with names like Amway, NuSkin, Avon, Herbalife and hundreds of others are anything like a franchise.
In brief, and please research more thoroughly if this subject interests you, as a distributor/associate of a multi-level company you will sell products directly to consumers mainly through relationship referrals. You will be required to buy product inventory and marketing materials. And the most interesting part of this scheme is that you will recruit other new distributors who will become part of your “downline”. The big come-on is that you will receive credit for a percentage of sales from your downline. Allegedly, you may see big bucks coming your way by virtue of signing up everyone that you know and anyone who crosses your path. A word of caution: Please check into the average amount individuals make before you start to load up on your credit card purchases.
So, is franchising anything like multi-level marketing?? The answer is a definite NO. If you want to know how franchising operates, and how it differs from multi-level marketing, take a look at Basic Franchise on the PureFranchise.com website.