MLM or Network Marketing isn't inherently screwed up, and it's really not designed to make only the guys at the top a log of money. Anyone can really make some extra money online - or even make a nice living at this.
But you have to do your due diligence, and "know before you go."
Look, you know (or suspect) what I've found out and am here to tell you - all MLM's are based on the same basic formula and concept.
This led me to find the same 3 common facts all MLM's have that need to be unearthed at the beginning - before you sign up - in order to make any MLM or Network Marketing scene work.
1. What's the entry cost?
2. What's the monthly payment?
3. Can you sell what you have to buy every month?
Let's take these apart:
All network marketing programs have some sort of way to get your "skin in the game". You have to invest something to get started. Some of this is done under the idea that you need to get a sample of all the company goods the company offers so you can be knowledgeable about their products to make your own offer.
Others have a simple, and low cost way to get started, with a "lifetime discount" or distributor offer. And many have an annual fee you need to pay to keep going.
In both cases, you invest something and now are intent on getting something back - at least make it pay for itself.
This is completely legitimate, and actually trading money for some thing actual completes the contract. So you'll minimally get some sort of "sales kit" or introductory package in the mail from them.
The trick is - can you afford what you are buying? What's the guarantee for returns of that item?
(Note: watch your returns policies. In some states, this can be as little as 3 days, which is shorter than the time it requires to get your package to you. But those are the scammy end, which are rare these days.)
Most of these have some sort of minimum order you have to personally buy, in addition to what you get others to buy. On top of that, the real income only comes in when you reach a certain level of sales. This is the tipping point where the whole system works. Frankly, the small orders don't add up unless there are a lot of them.
And this is exactly where the successful people operate - they get a lot of people sponsored into their downlines, all of which have that monthly payment to make. And as long as they keep going, your own minimums are covered. That is where the "leadership" comes in for all these guys.
One thing here - most MLM companies have some sort of bonus series which continue for the first 90 days. This is because that's about the average length of enthusiasm a person can generate on their own before they run into enough brick walls and slammed doors in their face that makes them discouraged. And so there is a lot of hype around this particular time period to keep you going.
One strategy down this line is to have a bunch of group meetings locally on a regular schedule so people can keep each other pumped up. It works because that is the way we are wired. Keep emotional involvement high to keep you involved and active.
Can You Sell What You Have to Buy?
Bottom line is that most of these companies can't compete on price. Which means you have to go after people who insist on higher quality and are willing to pay for it. Or want someone to personally help them with their monthly orders. In both cases, you are limiting the amount of people you can contact, either because more people can't see the value in the higher prices, or take more of your time.
A decent company is really just using the MLM model to rapidly expand their distribution base. They already produce a decent product which is lower-priced than the competitors - and will give you a substantial discount to move it for them. So you then can re-sell what you are requires to buy each month and at least make your money back while you then get your downline built.
One MLM'er told me recently that one of the companies he was in earlier was a good company, but the cheapest minimum order he could get wound him up with a selection of energy drinks which were half-again more expensive than what he could buy in the store. And they just wound up stacking up in his place.
Again, no value - or not enough value to keep him as someone's downline.
So: Know these facts about your new MLM company before you jump in - what's the minimum startup fee, what's the monthly minimum (and any annual update fee), and can you turn around and sell those products you are required to buy?
Those 3 facts will keep you from yet another expensive MLM education experience.
PS. Disclaimer: You'll see the few links I have on this page go to a "funded proposal". This is a key method for learning about how to rapidly build a downline regardless of what MLM you join. I've got more training to share with you on how to make any MLM successful - but for now, check out those links. Thanks!
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