There are many disreputable businesses that operate on the idea that you pay them for the privilege of trying to sell their product(s). Is there a common term for this kind of scam; one that could be used without an accompanying explanation?
Yesterday, John was contacted by a door-to-door sales company. They wanted him to buy sets of knives, then cold call family/friends/strangers. I think this company might be a(n) _____.
Edit: I'm looking for a word or phrase that is specific to this kind of business model.