Choose An MLM With Care
How To Choose The Best MLM Opportunity
Overcoming MLM Problems By Carefully Choosing An MLM (Network Marketing Opportunity)
You can overcome the problems many encounter with multi-level marketing by being proactive. Choose your opportunity with care and you can ELIMINATE the problems many network marketing reps encounter.
Many people use network marketing, also referred to as multi-level marketing or “MLM”, as their first venture in creating a home-based business.
After all, there are HUNDREDS of network marketing companies to choose from in the U.S. alone! You probably know someone – or several people – who are RIGHT NOW involved with network marketing. Network marketing has the promise of unlimited RESIDUAL income with no ceiling. You earn income based on the efforts of others!
Network marketing – or operating as an independent distributor for the MLM company – means you are your own boss. This fulfills the goal of time freedom, that is, being able to work from home and work when you want to. Finally, MLM has the HUGE advantage of allowing new people to “go into business” for less than the price of a flat screen TV!
With all these advantages, why do so FEW network marketing distributors reach their goal of financial independence?
Let me summarize a few of the main issues:
Most network marketing companies experience HIGH “attrition”. That is, MOST (as many as 75% or MORE) of the new independent distributors will quit within the first year. Some will quit to pursue another, more attractive offer. Others will quit and swear off MLM forever! But the “bottom line” is that people quit when they fail to make more than the “opportunity” is costing them each month!
Many people quit because of the high cost of the monthly subscription, also known as “auto-ship”. (Almost every network marketing company REQUIRES its representatives to commit to a monthly “auto-ship” purchase of goods or services.)
Unfortunately, many MLM’s sell products that can not stand alone in the marketplace. Distributors make the monthly purchases ONLY because of the promise of residual commissions. Without the promise of income, most people would NEVER buy the same products at the same prices! If commissions fail to materialize, the distributors soon realize that they are losing money every month and that they can live without the product, after all.
Likewise, many MLM’s have larger recruiting bonuses than commissions on retail product sales. These bonuses for recruiting new reps provide the promise of “big money” upfront. However, it is also a fact that most distributors will only sign up a few friends or family members – if any at all! Therefore, the lack of recruiting combined with the lack of a retail sales base results in low commissions, and the attrition of reps.
Because there is no retail market for the products, the new rep is forced to try to sell the business opportunity – before they have made a dime!. With no track record of success and no credibility they are forced to try to recruit complete strangers.
New network marketers struggle to “SELL” a business opportunity. And they don’t even understand network marketing, and neither do their prospects!
My suggestion to the lack of knowledge: employ a generic educational site to inform and instruct your prospects. Then work ONLY with those prospects that take action and show the desire to follow the system! Click HERE or on the image above to visit this site and learn what it means to “Own Your Life”!
My suggestion for the MLM consumer product drawbacks: AVOID niche markets and non-necessities.
You are going to need a base or retail customers as well as a downline network of representatives. Your business only succeeds by getting others excited about the products and opportunity.
1. It is much easier and profitable to promote products that have a PROVEN demand.
2. It is much easier and profitable to sell to motivated buyers.
For this reason, I avoid consumer products. Everyone knows that they can get it cheaper at Wal-Mart, Target or Amazon. So I don’t waste my time trying to compete with the big brands and the big retailers. Besides, consumer purchases are the first things to get cut when times are tight.
Instead, I concentrate on products and services that help businesses MAKE MORE MONEY! This is a huge, recession-proof market. After all, if I can help a business increase profits, why would they EVER stop using my services?
Network marketing works best when the products have the broadest possible market. Success in network marketing is DEPENDENT on exposing your company’s products and services to as many people as possible. In the case of my business-to-business marketing, I can ask ANY business manager, “Would you be interested in hearing about services that will increase your net profits?” Sounds like a universal appeal, right?
With a broad market and a universal approach, we eliminate all the pressure. There is an “open door” to talk to EVERYONE! There is NO pressure to sell anything – you are providing information and requesting feedback. (Unfortunately, some business people are too busy losing money to take the time to listen to profitable proposals…)
Always remember that your products should stand on their own – that is, sell to people (or businesses) that have no interest in the business opportunity! Otherwise, you are involved in a recruiting pyramid scheme!
Finally, there are many fine details about each company’s compensation plan that you should evaluate carefully. This topic is too detailed to cover here. I refer you to another article where I cover this topic more thoroughly, including the important concept of Residual Income.