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Can you really make money in MLM?

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Multi-level marketing statistics show that more than thirteen million people in the US are distributors for an MLM company. It’s more than $100 billion US dollar industry. So even if it is the minority who make money in MLM, it is a fact that people do make money in MLM. Click here to read about some of MLM Top Earners. These few may know how to manoeuvre the challenges of MLM, or they just lucky. About seventy percent of the distributors work part time and most of them are ladies. I think ladies trust other people easier than men.  99.9% of distributors make less than 150,000 US dollars per year. Mostly the 0.1% is made of the marketers at the top of the chain.

Only about ten percent of people who go into multi-level marketing (MLM) make money from it. The rest lose their investment. Mostly because they don’t have what it takes to excel in MLM. There is no shortcut to it, to excel in MLM one needs above average social skills, the ability to influence people and command a following. If you are an introvert this is not a business to engage in. The reason behind ninety percent failure rate is because; the barriers to entry are almost not there. With these, we have huge number easily joining and most of the new entrants also exit the same way. If you invest too little in a project, you don’t feel the pinch of losing your money, and there is no motivation to work hard. Others just join to please their friends or relatives, and that is no motivation for a competitive business.

There are a lot of wrong, limiting beliefs about MLM. Most people have this idea that MLM is a pyramid scheme and illegal.  MLM is a legal business model that most companies have used succeed. Unlike a pyramid scheme, which is a game of money, and where the gain of one is the loss of another, MLM is a direct marketing tool, where people sell legitimate products to needy customers at a fair price. Although there are some bogus schemes that introduce a cover up product to lure the public to believe that it’s a genuine MLM. MLM relies heavily on the entrepreneur building a good network of people who can multiply his effort in distributing the same products and recruiting new distributors, and the entrepreneur earning a small percentage from this network. The more persons the entrepreneur recruits the higher his earnings from the sales of the recruits

Also MLM is not a get rich quick scheme. Anyone with that intention will get frustrated. It takes a lot of hard work, dedication and planning to make money in MLM. Also called network marketing, MLM is just like any other business model. You can’t just sit at home and expect money to find a route into your bank account. Most people who have been successful in MLM set aside some hours of their busy schedules and look for customers and way to promote their business. They network and create a team that will propel their growth and success.

A friend whom I met selling forever living products built his portfolio for more than three years. He was always on the move looking for new clients to buy his products or join the network. He had a deep understanding of how the products work. In short, he was a good sales man for forever living products. At the end of the day he was able to earn a living from his side job.

Another major criticism is that, eventually the market of MLM products saturate, and marketers are left with nowhere to sell their products. This depends on the marketing strategy of the company. If the company is not supportive in marketing their products’ as quality and affordable, support their marketer with enough training, then no number of networked marketers can change their fate. The product market will definitely be saturated.

At initial stages one has to really do through research.  Make sure that the products have a genuine market, and what support mechanism the company will provide. Most of the companies do through training on the product usage and availability. Just as any other business model a SWORT analysis must be done. Know all that you can about the company, its products and market target.  Just joining an MLM network just because your friend has introduced you is a sure way of failure.  There are a lot of opportunities in MLM but you have to find just the right one. Something that you really believe it addresses a specific need in the society.

So to conclude, making a direct sale of a product is more profitable and has high chances of survival than MLM. Therefore to succeed in MLM you have either to join when the company is starting and work hard to build a network. Make sure you have a lot of distributors under you. This will result to more than 50 percent new recruits, are on your network. If this option is not viable, then join an MLM company that pays more commission on direct product sale, than number of recruitments you have. That is an MLM company that is closer to direct sale.

For long term successes in MLM choose a company that has a product that makes a difference in the society. A product that the company offers discounts maybe on quantity or cash discount basis.  A company that gives enough support to the products, and uses MLM for distribution of its products. Then you will have a chance of recovering your costs from the profits you make in product sales and commissions received, and if you are able to recruit members, more commission.

Make a business plan and do your research properly. If you can’t use the product you are selling over and over again, why do you think others will? Look for products that can easily sell to targeted consumers. That are of benefit to them and they will buy them over and over again. In this way you are sure of making money on two fronts. That of margin from product sales and recruitments of members.



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According to Wikipedia Multi-Level Marketing is a marketing strategy in which the sales force is compensated not only for the sales they generate, but also for the sales of the other sales people they recruit.

Multi-level marketing has faced a lot of criticism. Most people take it as a pyramid scheme, where the final result is loss of money. To add up to the list, there is a high start-up cost as sometimes you are required to buy a start-up kit. This start-up kit may have products that you don’t really love or believe in them, but you have to buy and sell. Other companies are involved in price fixing and give greater incentives for recruiting members than actual product sales.

Unlike pyramid schemes where to make money another person must lose, multi-level marketing is about selling genuine products to persons who really need them.  There are a lot of companies that use this model of marketing, and they have empowered a lot of entrepreneurs.  Many of the people who run “home business” are in this type of marketing. From testimonies of those who have been successful in MLM, they started MLM to support their incomes from their nine to five jobs.

Also known as Network marketing, the distributors make money by commission from their sales and sales of persons they have recruited. The more people you recruit the more commissions you earn, if they make a sale. This leads to another criticism, the complicated nature of calculating the commissions.

Some of the very top MLM companies in the world are:

That is only 10 of them! There are 100’s of MLM companies out there. The top distributors and earners in MLM monthly income can range from $95,000 a month all the way up to an astonishing $1,300,000 a month.

It’s a good way of making money for retirement, if you treat it as any other business. Most of the people who do MLM first do on part time basis. The most reasonable approach is to not leaving your nine to five job, but running your MLM business along your main job.  Slowly transit form your main job to MLM. But don’t treat it as a hobby, take it serious and have a plan.

With chances of making money through multi-level marketing being very slim, for anyone to make money through multi-level marketing he has to consider the following factors:

  1. Quality of the products on sale.

The basic fact of commerce is that you cannot make money selling a poor quality product. The company must be selling quality product at a fair price. Also the prices must be competitive in comparison with the competitors.

For you to sell a product you must believe that its quality and can solve a certain problem in the market.  The base is that you earn commission from the sales you make and the customers must be able to buy again and again if you are to make money.

  1. Are you a good sales person

To make money in MLM you must be good at connecting with people. MLM is all about building a network of distribution of a product. If you cannot connect with people you have no business in MLM. You must be able to ask your customers for referrals, communicate on new developments, be a leader by example and motivate your recruits. The most important skill in MLM is people skills. The ability to understand people needs and solve those needs with your products.

  1. Hard work

There is no easy money in MLM. You just have to invest a lot of time and sweat.  From organizing meetings, to follow up on existing and potential customers. You also have to talk about your product to all that you meet. Make people know what you are selling, and make them believe that its quality and competitively priced.

  1. Never sell what you cannot deliver

Just like any other business, MLM grows on reputation. Honesty is key. The more people can trust you the more products you sell and the easier it is to sell your products. The biggest mistake people do in MLM is deceiving and manipulating others to gain that quick money at the expense of the business as a whole. Business depends on repetitive sales and no one can return to buy your product if the first sale was a lie. Also referrals depend on the honesty of your sale speech, so make sure you tell the correct facts.

  1. Be reasonable and patient

What makes most people give up in MLM is the expectation to get rich quickly and easily. MLM is like any other business model. It takes time, effort and experience to make it to the big leagues.

Patience will also help you in being honest with your customers.  Make them understand from the word go, that it will take hard work and patience but eventually they will make money.  This will avoid short term frustration and increase dedication. People will be able to trust you and be willing to go the extra mile to make a sale. Always remember that it is the ability to make a future sale over and over again that translates to huge profits.

Have a one on one with those who have made it in MLM. They will tell you of their humble beginnings, time, and dedication it has taken to reach the top.

  1. Have a business plan

Am saying it again, MLM is like any other business. You got to have a plan on how you will do your business. What is target market, what your source of capital is, and what are the estimates of revenue and expenses.  This requires you to do extensive research on your product and market. You cannot succeed in MLM if you don’t take it seriously and put enough effort.  Do your initial research on the company and make sure that they pay more incentive on selling their products than on the people you recruit. With these you know the company believes in the quality and usefulness of their products.

Review your plans monthly or after a certain period and adjust according to the reality on the ground. But remember you have a goal to attain and only strategies change towards that goal. This will enable you to know when to quit or put more effort, or change product and companies.