CHAPTER I

INTRODUCTION

Overview of the Study

Though there is no documented history of origin of multi-level-marketing,

generally it is believed that this concept owes its origin to “Nutralite” or formerly

known as California Vitamin company which produces food supplement products.

In early part of 1940’s, the Company used to engage direct selling.

The concept of multi-level-marketing or network selling seems to have

emerged accidentally when the distributors discovered that they were generating

more sales for the company by referring their friends and known people to the

business opportunity available with Nutralite. At this point of time there was no

system in place to recognize and reward the distributor for their effort in recruiting

other distributor for the company. With the realization dawning on the distributor

and the company, the system of paying 2% bonus to the sponsor distributor on the

sales that were achieved by the distributor and the network that he sponsored or

built was introduced. This then led to the birth of modern-day system of pyramid

selling.

Frontrow is one of the biggest and fastest growing direct selling company in

the health, beauty and wellness industry in the Philippines today. It is a 100 Filipino

owned corporation spearheaded by two of the most-promising new-breeds of

entrepreneurs, Raymond ‘RS’ Francisco and Samuel Verzosa. As new blood of

businessmen, they introduced a new formula for success in the Multi-Level

Marketing industry in order to build a more forward-driven company that is

Frontrow.

Background of the study

The two owners of Frontrow who are Raymond Francisco and Samuel

Verzosa were formerly members of other MLM company, when that company

already grows, they found out that the company was a scam. After finding out it

was a scam, all of the members were fooled, then Raymond Francisco and Samuel

Verzosa decided to build a new MLM company named Frontrow International at

their own expenses. As of now Frontrow International is the most influential and

successful multi-level-marketing here in Sta.Cruz, Laguna by giving many

opportunities in the community to students, employees and even bystanders. But

there’s some doubt in other people’s mind because of Multi-Level Marketing big

issues they are facing right now in the digital era.