WHAT IS MLM OR NETWORK MARKETING ?
MLM aka Multi Level Marketing or Network Marketing is a low capital start up business. They are also called Affiliate Marketing, Direct Sales etc depending on the structure of the compensation plan.
HOW DOES MLM OR NETWORK MARKETING WORK?
Network Marketing is basically the buying products from your own store (company) instead of buying it from the supermarket, doctor, pharmacy or other companies etc. When you get other people to do the same, the company pays you a sales commission every time the people you have signed up buys the product you recommended.
You need not carry any stocks, have sales staff or office. You just recommend people to the company and the company will pay you the sales commission The company will also deliver the products to your customer(s).
If the customer recommends the product to another friend, you will be paid a Referral Fee and Commission also. For my company, this goes on indefinitely until your weekly commissions reach US$13,500 A WEEK (for my company). Once you have reached this stage, you would become a Professional Network Marketer and are ready to go to the next level (provided you meet the qualifications of being an Executive) where your income can be unlimited depending on your business skills, team growth and activity.
That in a nutshell is MLM. You are paid on your efforts and the efforts of others who do the same under the two lines / teams / legs started by you – all the way down the line. It is possible that you may be earning from the efforts of people you have never met as these are brought in by your friends of friends of friends etc etc. These people are called your “downlines / team / organisations / associates“.
EXAMPLE OF HOW MLM / NETWORK MARKETING WORKS
You plant a single lily pad in the pond on day one.
1. Lily pads double every day
2. On day 30th, the pond is 100% full of lily pads.
3. How full is the pond on the 29th day???
When you understand this idea, you’ll understand the Power of Network Marketing
ANSWER: The pond is 50% full on the 29th day
ADVANTAGES / BENEFITS OF NETWORK MARKETING?
- No Employees
- Low Overheads and Start Up Costs (capital)
- No Special Degrees / Qualifications
- Time Freedom
- Work from Home, starting Part Time
- Ability to Leverage on Others’ Efforts
- Residual Income (ie once you have build a strong team, you will continue to earn income from this business even if you’ve stopped working.
MAIN REASONS WHY PEOPLE JOIN MLM / NETWORK MARKETING
WHY DO PEOPLE JOIN MLM COMPANIES ?!
- 51% Supplemental Income
- 34% Full Time Income
- 9% Product Discounts
- 6% Meet New People
In a struggling economy with over 8% unemployment, MLM offers a safety net for aspiring entrepreneurs who want to work at their hours and realize financial independence.
OTHER REASONS PEOPLE JOIN MLM?
People join MLM companies for many different reasons.
Here’s a partial list.
- Join MLM as a social activity
- MLM is a great place to meet people and have fun.
- Join MLM to transition into business ownership.
- Join MLM to help people.
- Join MLM to live where you want to live.
- Join MLM to create wealth.
WHY CORPORATIONS LIKE MLM?
- MLM companies pay for production, not for coming to work
- Best possible use of your time
Top 5 Reasons for Considering a Network Marketing Business
- BE YOUR OWN BOSS—You are in complete control of how you invest your time and how you go about building your business.
- SAVE TIME AND MONEY—As an independent business owner, you purchase the products you love at discounts and you operate all activities from your home.
- EXPAND YOUR CIRCLE OF FRIENDS—Direct selling business opportunities are based on building relationships. When building a direct selling business, customers and other team members appear to quickly become important and rewarding aspects to one’s life.
- BE RECOGNISED AND REWARDED FOR ACHIEVEMENT—It’s not every day
- that an adult receives praise for an effort well done, but direct selling companies recognize and reward their independent business owners through bonuses, trips and prizes. This is an essential component to the business model.
- BUILD INCOME—The direct selling compensation model offered by most companies allows the building of organizations that have the potential to create incomes beyond those earned from the personal selling/servicing efforts of the direct seller.
Reference: Direct Selling News
HOW TO EVALUATE A NETWORK MARKETING COMPANY?
- Ask how the company got started and who started it. Is the dreamer who started it still involved? Has the company been sold to investors?
- Ask if the company is solvent (capable of meeting financial obligations).
- Ask if the company is growing (more sales than last year).
- Does the company listen to and implement suggestions from leaders? Most good companies have a “Field Distributor Advisory Board” that are rotated and elected every year and meet quarterly or semi-annually.
- If the company is over 10 years old, does it reinvent itself by opening in new countries and creating new products? A “single” product company will find itself running out of customers after a given period of time, just like any company does.
THE DIFFERENCE BETWEEN A JOB, A TRADITIONAL BUSINESS, FRANCHISE AND NETWORK MARKETING:
Franchise used to be a good alternative to traditional business until it became too expensive. A good franchise nowadays can now easily cost at least USD half a million.
How MLM Works
HOW TO TELL IF IT IS A MLM SCAM?
A QUALITY PRODUCT OR SERVICE
A legitimate network marketing program has to have a product or a service that people are looking for and willing to buy. This allows distributors to grow and strengthen the networking program.
If a network marketing opportunity only sells a dream of getting rich without a tangible project or service to promote, then it’s most likely a scam. Avoid any program that offers commissions solely on recruiting more people. Legitimate programs still pay for recruits, but that should always tie into selling a product or service.
MINIMAL INITIAL INVESTMENT
Legitimate network marketing programs usually require the purchase of a sales kit (at a minimum) so you have tools needed to reach out to others and sell. They don’t ask for outrageous payments upfront, for whatever reason, be it fulfilling a initial requirement for inventory or undisclosed deposits. If you find that a network marketing company demands a tremendous investment before you can join, be very wary — the chances of them running with your money are much higher.
CLEAR RETURN OR BUY-BACK POLICY
In conjunction with the previous point, a legitimate network marketing program does not allow members to overstock company products. This lets you concentrate on the actual networking instead of worrying about having to sell out the entire stock. Similarly, you should also be able to return the products to the company and get a refund if you choose to opt out of the program through a buy-back guarantee. Of course, the items have to be in a saleable condition, but that is just one of the terms that should be outlined for prospective members.
SUPPORT THROUGH TOOLS AND TRAINING
Like any other real business, legitimate network marketing companies want their independent distributors to do the best job they can. That’s why you should ask if the program you’re planning to join will provide tools you’ll need to start selling and recruiting. The type of tools that may be offered include tracking systems for your sales, commissions, and product deliveries. Also, a legitimate MLM program should prepare and hone your skills with training sessions led by the veterans and industry pioneers.
NO OUTLANDISH PROMISES
The moment you’re told that you will get rich quick with little to no effort, or that you’ll be a millionaire within months that’s when you should look elsewhere. If it sounds too good to be true, then that is probably the case. A legitimate MLM program will require you to put in the work (i.e., reaching out to people, marketing products, attending training sessions, utilizing tools properly).
WHERE CAN I LEARN MORE ABOUT MLM?
In order to succeed in this business, it is important for you to determine WHY you want to do Network Marketing.
Your WHY keeps you going even when times are tough and you are down with rejections. Because this business is a NUMBERS game. The more people you talk to, the greater are your chances of success. Most successful sales and network marketing professionals know that even a 1% success rate at the beginning and add up to a lot in the end. However, with more experience and learning, it is likely that your success rate will go up to 20% or more depending on your commitment.
Here are some sales statistics on who eventually wins the Numbers Game.
Watch this video on why you need to strengthen your WHY. good leaders who figure out their WHYS are more successful than those who don’t:
If you Believe in Yourself, you can endure anything
Here are some interesting videos on MLM / Network Marketing.
It is the 21st Century way of doing business without a large capital investment.
If you lose your job and don’t have a way of producing income, you will go bankrupt or suffer poverty.
Network Marketing is a way to producing a passive income –
ie if after building a strong business, it will continue to pay you even when you’ve have stopped working on it.
Isagenix offers you such an opportunity to build your own business and be financially free in a world where uncertainty is the new normal.
Watch this video to understand this powerful concept of wealth building.
Remember, if your income is not passive and does not have leverage abilities, you are forever enslaved in a J.O.B. – Just Over Broke
Understanding MLM Companies | How Multi Level Marketing Works
Direct Sales / Multi Level Marketing / Network Marketing is the vehicle that enables many, many people realize their goal of owning their own home-based business. The secondary results are an extraordinary way of life, freedom of time and financial freedom!
This is one book I strongly recommend my associates read to get a better understanding of the benefits of MLM by Robert Kiyosaki “Business of the 21st Century”
Or To Listen
What If Someone Says, ‘Isn’t This A Pyramid?’
PEOPLE WHO ENDORSE MLM / NETWORK MARKETING:
- Warren Buffet – Billionaire Investor
- Donald Trump – Real Estate Mogul
- Bill Gates – Microsoft
- Robert T Kiyosaki – “Rich Dad”
- Paul Zane Pilzer – former US Presidential Advisor
- Jack Canfield “Chicken Soup” (with Isagenix)
- John Gray “Men are from Mars” (with Isagenix)
- Anthony Robbins – Self-Help NLP Guru
- Randy Gage – Author, Motivational Trainer
- Les Brown – ex-Politican
- Tim Sales – Author, MLM Trainer
- Bill Clinton – former US President
- and many more…..
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