|
Multilevel
Marketing - Benefits & Drawbacks
If you’ve ever dreamed
of running your own business from home, whether on a
full or part-time basis...and are good with people but
have very little business knowledge, then Multilevel
Marketing (MLM) may be for you. This is especially true
if you have a minimal amount of start-up cash.
MLM companies provide a product or service
to the consumer via a network of “independent”
distributors, who usually work from their home.
Reputable MLM companies also provide
a low start-up cost, all the training you need, advertising
in one form or another, and supply you with a product
line-up or service to sell. They also allow you to recruit
other distributors and make commissions on their total
sales.
The United States Federal Trade Commission,
however, cautions anyone from joining a MLM company
that pays you for each distributor you recruit, as opposed
to only paying a commission on the total sales they
generate. This is called ‘Pyramiding’ and
is illegal.
The U.S. FTC also encourages you to
thoroughly research a MLM company before signing on
the dotted line, and not to sign anything under pressure,
but instead, take time to consider all the details.
You can check out their Multilevel Marketing Caution
Web Page at: http://www.ftc.gov/bcp/conline/pubs/alerts/pyrdalrt.htm.
On this page, they also list seven checks you should
do before making your decision whether to join or not.
Research is always an important component
of any business venture and considering a distributorship
with a MLM company is no exception.
Searching the Internet under “Multilevel
Marketing” returns a recipe of results. These range
from government agencies, general information web sites,
encyclopedia type sites to a host of disgruntled, former
MLM distributors. People who are “pro” MLM
don’t write web sites on the topic because they’re
usually too busy building their network.
THE GOOD SIDE
Here are some of the benefits of finding
a reputable MLM company:
- They have an established and very
marketable product line or service, and strive to improve
or add to the existing line-up.
- Recruiting new distributors will be a streamlined
process, and the company will not be involved in Pyramiding.
- As a company, they will have a solid track record
and good work ethics.
- No experience will be required. A good MLM company
will provide one-on-one training, as well as motivational
seminars and a full compliment of training materials.
After all, in Multilevel marketing, when one succeeds
all succeed.
- A reputable MLM company will be “Family”
rated, meaning that crude conduct is not tolerated.
- They will provide an excellent bonus plan with many
incentives for those who excel.
- Well-established MLM companies should be able to provide
you with resource material to aid you in not only product
sales but in recruiting.
- They will have minimal start-up fees.
- A strong support system.
- You will be led by example.
- Healthy team competition.
- There will be a successful business and marketing
plan in place that can be successfully duplicated by
others, assuming they apply themselves to the plan and
are motivated to succeed.
- There exists the possibility of full-time or part-time
commitment.
These attributes would definitely belong
to an ideal Multilevel Marketing Company, however not
all reputable companies excel in all these areas. Some
companies will be better in certain areas than others.
Do research on the company. Don’t just accept the
motivational hype used by most MLM companies in order
to recruit.
Some MLM distributors are so highly
trained that they have a “come-back” for almost
every statement you make or concern you have. This would
be considered a ‘high-pressure’ invitation
to join. Always take time away to cool off – especially
if you’re excited by what you heard. Sit on your
decision for a while and do research. If the company
is good, they will still be there when you wake up tomorrow;
and yes, you will get a follow-up phone call.
THE DOWNSIDE
While the MLM model can be a great tool
to achieve what you want in life, it would be remiss
not to mention the downside.
- It is easy to get ‘taken’
by a disreputable MLM company. Do your research.
- If you plan on developing a network – a “downline”
– it will cost you more money than you realize
and take you longer than you think – although this
is slight compared to the cost and time required to
start up a traditional business. You will spend a lot
on resource and training materials that you will end
up giving away to prospects and to your downline distributors.
- You might spend a lot of money on fuel for your vehicle,
meals out, hotel rooms or neck surgery from sleeping
in your car.
- Some companies insist on a minimum monthly order to
maintain your distributorship.
- Some companies only pay you for recruiting other distributors
and not on their total sales volume. Beware, as this
is called ‘Pyramiding’ and is illegal in most
countries.
- While you may initially be led to believe that the
products sell themselves and that you can make a lot
of money with little effort, beware. Most businesses,
whether they are traditional, online, or MLM, take a
lot of energy and effort to make them successful. Consider
a rocket: 60 – 80% of the fuel is used just to
raise it a few inches off the ground.
- Be ready for a lot of rejection. Approximately 80%+
of the people you contact will turn you down.
- It is easy to get caught up in the ‘dream’
and overspend because, “Winners always find a way.”
It is also easy to be pressured into ‘willingly’
spending beyond your means.
- It could very easily become your life’s vocation,
with everything centered on it. Some distributors even
refuse to attend family weddings etc., because it falls
on the same date as their MLM seminar.
- Also, like most businesses, when you begin you will
be spending much more than you make.
The final judgment: Most business entrepreneurs face
the question, “How much am I able and willing to
lose if it doesn’t work?” That is the question
you have to ask yourself before you get into Multilevel
Marketing.
And of course, what do you want from
life and what are you willing to do to get it?
If you enjoy helping others succeed
so that you can succeed, are willing to take the risks
associated with being in business for yourself, even
on a part-time basis, and are willing to put in long
days, then Multilevel Marketing may just be the tool
you are looking for to achieve your business and life
goals.
Here’s to success!
1howto.com
--------------------------------------------------
Please
Share Your Tips with Us
|
