If I were a high-tech wizard or creative enough to make an unbelievable product that could reshape the world, improve our standard of living, and really make a difference I would. But, I haven’t figured that out yet. If I do, I would want to be able to share it with as many people as possible in as a cost effective way. That’s business. Without a lot of capital though there are few options. Sure, I could hire a PR agency, a slew of marketing specialists, and the best sales people around. But, that costs a lot of money – especially upfront. Salaries are usually one of a company’s largest expense. So, what is a more efficient way?
One way to market a product or service you REALLY believe in is to retain folks that have the same vision, share the same passion, and have the same beliefs. We recruit these people and give the part of your earnings. That way your upfront expenditures and financial (out of pocket money going to advertisers and salaries) risk is limited. Plus it benefits everyone – you are getting the “word out” about your fantastic product or service in a cost-effective way and you are building a team where you all benefit. When you make money, so does your team. Not only that, you are encouraging team work and leadership by rewarding those that build and manage teams well. Sounds like a win-win situation to me. And, my practical mind tells me it’s a great concept. But, that’s what multi-level marketing or better known as MLM is. What’s the problem, then? It has gotten such a bad rap that, upon hearing that phrase, people start running for cover.
Of course, with anything there are always the bad apples that ruin it for all others. As an entrepreneur, I still think it’s a great concept for all involved parties. Except we need to watch out for the snake oil sales people and the unethical people that try to sell you out of your own shoes. If you get anything out of this article, please understand the concept of MLM and why businesses go that route – keep an open mind. Many successful people did what they did by going against convention. But here are some business opportunity and MLM tips to steer you in the right direction and to look for:
1) Are you required to “invest” a large amount of money up front to become a distributor? This investment request may be disguised as an inventory charge. Legitimate MLM businesses do NOT require large start up costs.
2) If you do have to pay for inventory, will the company buy back unsold inventory? Legitimate MLM companies will offer and stick to inventory buy-backs for at least 80% of what you paid.
3) Is there any mention of or attention paid to a market for the product or service? MLM depends on establishing a market for the company’s products. If the company doesn’t seem to have any interest in the consumer demand for its products, don’t sign up.
4) Is there more emphasis on recruitment than on selling the product or service? Remember, the difference between MLM and a pyramid scheme is in the focus. The pyramid scheme focuses on fast profits from signing people up and getting their money. If recruitment seems to be the focus of the plan, run.
5) Is it a product and/or service you would use, recommend to people, and believe in? This alone can make a huge difference in your success.
6) Watch out for promises of huge profits. Inflated claims for the amazing amounts of money you’re going to make should set your alarm bells ringing. Legitimate MLMs like other companies take time to build. There really are no ways to a lot of FAST money. If there are let me know!
7) As always, when you’re investigating a potential business opportunity, you’ll want to gather all the information you can about the MLM company’s products and operations. Can you sell the idea for multiple years? Will it replace your current means of income and start putting bread on the table? Or are you looking to supplement your current income? These are all questions that you should be asking yourself. . Marketing techniques should be in place.
Listen carefully when you’re at that MLM recruitment meeting. Being part of a successful MLM company can be both profitable and fun, but unfortunately, some purported MLM opportunities are actually pyramid schemes designed to flatten both your wallet and your dream of running a business.
Overall, starting your own business can be a daunting task. But, instead of recreating the wheel you can find ethical and legitimate business opportunities that utilize MLM to their and YOUR advantage. Don’t discount all MLMs because of some of the bad apples out there. Do your homework, find something that you believe in, and have fun with it. You will be very glad you harnessed your cynicism.
Todd is a financial planner, speaker, writer, and entrepreneur that vs always seeking new opportunities to make our communities safer and stronger. One of his causes he is working on now is www.mywebsafety.com/keepyourkidssafe Learn more how you can help stop the abuse of thousands of children today.
