1 min read
Network Marketing (Multi Level Marketing)
Everything about Network Marketing
Teamwork makes the dream work.
About Me
Welcome to my blog. My name is Mohammed Hussain. My friends call me Hussain. I hope you will do the same thing.
I love our industry. Many people will not understand that, but I know a few of you will.
What I love most about this industry is helping others, the personal development, the ability to be your own boss and call your own shots, working from a laptop anywhere in the world, and the residual income.
My first network marketing company was Amway. When I first saw the circles drawn on the dry erase board I was hooked. I didn’t sleep well for several days. I was so excited about what this industry offers ordinary people.
If anything, I was angry that no one had ever taught me about residual income, time freedom, leverage or network marketing before that. Now, more than 16-years later I still feel the same way about our industry.
My experience in this industry is similar to most people. It has not been easy for me. It has been a constant, up-hill challenge. I mentally quit thousands of times. I even physically quit a few times.
Despite the difficulty I had for many years, the industry has always been appealing to me. It’s always drawn me back in. It’s like a disease I couldn’t get rid of. I truly believe that once you learn about, and understand residual income, it never leaves your blood. You will spend the rest of your life trying to create it, and rightfully so.
I knew that if I stuck with it, I would eventually figure out how succeed in network marketing. My journey to success took longer than most, but I am so glad I stuck it out.
When you really stop and think about it, how many businesses offer you the following things:
Residual income (this one thing alone makes it worth it, everyone needs residual income)
Leverage without employees or money
A three to five-year plan to complete financial freedom
Low start up costs, less than a few hundred bucks
Work from anywhere in the world
Free mentor
Personal development plan
No need to source or inventory products
No accounts receivable
No paperwork
No need to collect payment or deliver products
No territories
Recognition and Praise
Travel
No need to research and develop products
The company does the customer service, deliveries, refunds, product development and sends you a check each month
Seriously… stop and think about this for a minute! Try to name even one other business model that offers all of these things.
At the time of updating this page (AUG 2018), I have been in the industry more than 16 YEARS.
Let me start by telling you that I am NOT rich. I don’t have 840,000 people on my team (but, I’m working on that). I’m not a guru, although I am quite knowledgeable about the industry. I am simply an average, hard working, determined, committed person who made the decision to get started and make this my profession.
When I first joined the industry, I had a lot of baggage to overcome (more than most). I had a horrible self-image, bad attitude and I was a jerk. Thank goodness for the personal development! I am now a totally new person.
After committing about two and a half years to my first company (Amway) I decided to take a short break from the industry. I had a nice team going and was making some money, but I was burnt out and going through a painful divorce. I left the business for personal reasons.
During the next TEN YEARS, I bounced around to many different network marketing companies. I wasn’t really committed to ANY of those companies. I was one foot in, but never all in. I’d dabble with each company for three to nine months and then be off to the next shiny object.
I never found a company I was REALLY passionate about, nor did I ever put in the work it takes to succeed (in a big way). My failure, or lack or results, was my own fault. In other words, I never even gave myself a fair chance to succeed. Can you relate? Once again, my problem was me. I simply did not have the skills, mindset or commitment it took to succeed.
Types Of MLM
know about multi level marketing.
Multi-level marketing (MLM), also called pyramid selling,[network marketing,and referral marketing,is a marketing strategy for the sale of products or services where the revenue of the MLM company is derived from a non-salaried workforce selling the company's products/services, while the earnings of the participants are derived from a pyramid-shaped or binary compensation commission system.
Although each MLM company dictates its own specific financial compensation plan for the payout of any earnings to their respective participants, the common feature which is found across all MLMs is that the compensation plans theoretically pay out to participants only from the two potential revenue streams. The first stream of compensation can be paid out from commissions of sales made by the participants directly to their own retail customers. The second stream of compensation can be paid out from commissions based on the sales made by other distributors below the participant who had recruited those other participants into the MLM; in the organizational hierarchy of MLMs, these participants are referred to as one's down line distributors.
The end result of the MLM business model is, therefore, one of a company (the MLM company) selling its products/services through a non-salaried workforce ("partners") working for the MLM company on a commission-only basis while the partners simultaneously constitute the overwhelming majority of the very consumers of the MLM company's products/service that they, as participants of the MLM, are selling to each other in the hope of one day themselves being at the top of the pyramid. This creates great profit for the MLM company's actual owners and shareholders.
As noted, many MLM companies do generate billions of dollars in annual revenue and hundreds of millions of dollars in annual profit. However, the profits of the MLM company are derived to the detriment of the overwhelming majority of the company's non-salaried workforce (the MLM participants). Only some of the profit is then significantly shared with none but a few individual participants at the top of the MLM participant pyramid. The earnings of those top few participants then allows the creation of an illusion of how one can potentially become financially successful if one becomes a participant in the MLM. This is then emphasized and advertised by the MLM company to recruit more participants to participate in the MLM with a false anticipation of earning margins which are in reality merely theoretical and statistically improbable.
Although an MLM company holds out those few top individual participants as evidence of how participation in the MLM could lead to success, the reality is that the MLM business model depends on the failure of the overwhelming majority of all other participants, through the injecting of money from their own pockets, so that it can become the revenue and profit of the MLM company, of which the MLM company shares only a small proportion of it to a few individuals at the very top of the MLM participant pyramid. Participants, other than the few individuals at the top, provide nothing more than their own financial loss for the company's own profit and the profit of the top few individual participants.
Although each MLM company dictates its own specific financial compensation plan for the payout of any earnings to their respective participants, the common feature which is found across all MLMs is that the compensation plans theoretically pay out to participants only from the two potential revenue streams. The first stream of compensation can be paid out from commissions of sales made by the participants directly to their own retail customers. The second stream of compensation can be paid out from commissions based on the sales made by other distributors below the participant who had recruited those other participants into the MLM; in the organizational hierarchy of MLMs, these participants are referred to as one's down line distributors.
The end result of the MLM business model is, therefore, one of a company (the MLM company) selling its products/services through a non-salaried workforce ("partners") working for the MLM company on a commission-only basis while the partners simultaneously constitute the overwhelming majority of the very consumers of the MLM company's products/service that they, as participants of the MLM, are selling to each other in the hope of one day themselves being at the top of the pyramid. This creates great profit for the MLM company's actual owners and shareholders.
As noted, many MLM companies do generate billions of dollars in annual revenue and hundreds of millions of dollars in annual profit. However, the profits of the MLM company are derived to the detriment of the overwhelming majority of the company's non-salaried workforce (the MLM participants). Only some of the profit is then significantly shared with none but a few individual participants at the top of the MLM participant pyramid. The earnings of those top few participants then allows the creation of an illusion of how one can potentially become financially successful if one becomes a participant in the MLM. This is then emphasized and advertised by the MLM company to recruit more participants to participate in the MLM with a false anticipation of earning margins which are in reality merely theoretical and statistically improbable.
Although an MLM company holds out those few top individual participants as evidence of how participation in the MLM could lead to success, the reality is that the MLM business model depends on the failure of the overwhelming majority of all other participants, through the injecting of money from their own pockets, so that it can become the revenue and profit of the MLM company, of which the MLM company shares only a small proportion of it to a few individuals at the very top of the MLM participant pyramid. Participants, other than the few individuals at the top, provide nothing more than their own financial loss for the company's own profit and the profit of the top few individual participants.
How Does MLM Work
How Does Multi Level Marketing (MLM) Work
A long time friend that you lost touch with for the last 10 years gives you a call and asks to meet up. After meeting up and breaking the ice, he/she then introduces a new revolutionary product and how you stand to get rich by selling it. Throw in jargons like passive income and downlines, you suddenly realise you’re beginning to be sucked into the dream they are selling. Sounds familiar? But is MLM/Network Marketing a really bad? Is this practice legit or is a scam? In this article, we will discuss and answer these questions.
Is MLM a Pyramid Scheme
MLM itself is a legitimate business strategy. However the subject of ethics can be rather vulnerable. The pyramid scheme, unlike MLM, is clearly a scam. In a pyramid structure, a member pays a fee to join. A portion of the money will then be remitted back to them when they bring a new member into the scheme. No products are involved in this scheme, simply get more people to dump in money for your chance to make more money. There are clear differences between the pyramid scheme and the MLM scheme. Because generating income in a pyramid scheme comes at the expense of another person, a win-win situation will never be possible. In MLM however, the sales of products can generate true revenue thus creating a sustainable ecosystem for both themselves and their downlines.
How to Succeed In Networking Marketing
Investigate companies. Choosing the right company is key to your success. Quick and easy internet searches can usually answer many of the questions you may have. Do some research to determine which company is best for you personally. Some questions you should ask yourself when researching companies are:[1][2] How old is the company? Is it well-established or is it just starting out? How are the company's sales? Are they rising or falling? What is the general reputation of the company? Reviews and blogs can usually give you a good idea if the company is reputable or suspicious.
Read More
Look up CEO's and other company leaders. Keep the same things in mind as when you investigated companies. Is the company leadership reputable and law-abiding? If company leaders have been accused of carrying out scams or have had legal trouble, you may want to avoid this company.
Read More
Since you'll be responsible for pitching and selling this product, make sure it is reputable. Some MLM companies market questionable or dangerous products, and you could face legal action if you take part. You should keep the following in mind when considering a product:[3] Is this product safe? Are the product's claims backed up by legitimate research? Would I use this product? Is this product priced fairly?
Read More
When you've found a company you're interested in, you'll likely meet with a recruiter or another representative. Be skeptical during the recruitment process. Remember that your sponsor makes more money if you sign on, so he may not be as open with you as he could be. Don't get distracted by promises of how much money you'll make and really think about what you're about to do.[4] Ask direct and specific questions. If you find the answer too vague, ask for clarification. Ask exactly what the company will expect of you- how much are you expected to sell? How many people are you expected to recruit? Are you required to take part in training programs?
According to the Federal Trade Commission, some businesses posing as MLM companies are actually illegal pyramid schemes. Pyramid schemes scam recruits into buying into a company and almost always result in a loss to the recruit. Some things to look out for are:[5] If a company makes more money selling products to distributors than to the public. If a company makes more money recruiting members than by selling products. If anything seems wrong to you, don't sign a contract.
When you have a few potential companies in mind, write out your plan for building and expanding your business. Even before you've officially aligned with a company, it helps to have this plan figured out early. Thant way you can hit the ground running when you do eventually start at a company. Keep these things in mind when designing a business plan: What product or service are you intending to sell? Who is your intended market? How much time will you dedicate to this? Will it be a part-time commitment or are you planning on working seven days a week? What is your goal? Do you want to get rich or just make some extra money? Think long-term. Where will you be in five years? Ten years? What is your marketing strategy? Will you make cold calls? Use the internet? Go door to door? You can update or change the plan as needed, but it helps to have a guide when you're just starting out.
To turn leads into paying customers, you'll have to follow up with them and pitch your product. Set up your web page with an auto responder designed to contact people who visit your page. Manage all your contacts in an organized file with all their information easily accessible. Have a sales pitch ready at all times when you contact a lead. Try more than once to turn a lead into a customer. Just because someone wasn't interested once doesn't mean they will never be interested. Be careful not to overdo it, though- you could easily get a reputation as a spammer, which can hurt your business.
Myths About MLM
Many people are scared away from network marketing, also known as multi-level marketing (MLM), because of all the myths and misunderstanding about this type of business. Part of negativity comes from reported low MLM success rates. However, a multi-level marketing business isn't destined to fail any more than any other business. Regardless of the home business you start, success comes from doing the work to build it. For some reason, many people don't view their MLM business as a business, like they would if they opened a franchise or started a business from scratch. One of the most important things you can do to insure your success is to treat your MLM venture as the business it is. Here are a few other tips to help you improve your multi-level marketing (MLM) and recruiting efforts within the world of direct selling: 1) Brush Up on the Realities of MLMs To stay safe from pyramid schemes and MLM scams, arm yourself with knowledge. Learn about the direct sales industry as a whole, research MLM companies carefully, and determine if you're a good match with your sponsor. The truth is, while you can get rich in MLM, statistics show that less than one out of 100 MLM representatives actually achieve MLM success or make any money. However, that's not necessarily the MLM business' fault. Most athletes never make it to the Olympics, but that's not sport's or the Olympics' fault. Any great feat requires knowledge and action. 2) Find a Company With A Product You Love Too many people get caught up in the hype of potential big income from MLM, that they don't pay enough attention to what the company is asking you to sell. You can’t sell something or share your business if you don’t genuinely have pride in what you are representing. Do your MLM research and partner with a company that has a product you can get excited about. Don't forget to look into the company's compensation plan before you join and make sure it is favorable to you. 3) Be Genuine and Ethical One reason that direct selling gets a bad rap is that many representatives use hype and sometimes deception to lure in new recruits. This leads many to believe that the MLM companies themselves encourage this behavior, when in truth, they don't. Legitimate MLM companies want you to be honest in your dealings with customers and potential recruits. If you love your product, your enthusiasm is enough to promote it. Just make sure you're not over-the-top or making exaggerated or false claims.
MLM FAQs:
1. What is MLM?
MLM is simply a distribution model. That’s it.
Instead of products being sold to wholesalers, the manufacturer has an independent sales force to sell the products via word of mouth. Instead of spending money on advertising, the company rewards the distributors with commissions for selling the products.
Instead of products being sold to wholesalers, the manufacturer has an independent sales force to sell the products via word of mouth. Instead of spending money on advertising, the company rewards the distributors with commissions for selling the products.
2. How Do You Recruit People?
You can build a team initially by talking with people you know. Most people have a sphere of influence of 500 to 2000 people. In most cases, you will be able to sponsor some of these folks to start your team. As time progresses, you should utilize the internet, paid advertising, and daily prospecting to find new distributors.
3. How Do You Make Money in MLM?
You earn commissions and retail profits from your personal sales. And you earn overrides and commissions from your team’s sales. In essence, you are an independent contractor working as a salesperson for the MLM Company. Each compensation plan is different, but you normally get paid a certain percentage of your entire organization’s sales.
4. What Types of Products Are Sold Through Network Marketing?
MLM Businesses mainly focus on consumable items. This includes healthcare and nutrition products, cosmetics, consumer durables, etc. Since these are the most common items purchased, selling them becomes easier and more profitable. And since they are consumable, customers and distributors will use up the products each month and then need to place a new order. This creates residual income.
Other MLM Companies specialize in utilities, juices, legal services, travel, phone plans, gold, silver and countless other items. If you can think of an item, it’s probably sold in at least one network marketing company.
5. Is MLM Legal?
Yes, network marketing is legal in the United States and many other countries including inda. In 1979 Amway battled the Federal Trade Commission and scored a major victory for the network marketing industry. To be legal, distributors must focus on selling products and not get paid for the mere act of “recruiting” people.
6. Is the Industry a Scam?
I don’t think so. But, I do know that some distributors utilize corrupt or deceptive business practices. Like any industry, there are good and bad people in the industry. Most people are pretty quick to call our industry a scam, even if they’ve never researched it themselves.
Many of the folks who get involved with MLM (1) don’t have any business experience, (2) they are looking to get rich quick and (3) they aren’t willing to do the work. As a result, many of these folks get in for 30 to 90 days and then quit and say they were scammed. The truth is, you can’t build a successful business of any kind in 30 to 90 days.
7. What is the Success Rate of Any Given MLM Biz?
It’s been said that 97% of all network marketers lose money. I have never seen written evidence that supports that claim, but I’d bet that less than 10% of the people make any type of significant income. While many people who participate in our industry earn nothing or lose money, some distributors earn six or seven figure incomes. Individual results will always vary based upon individual effort, time invested and skill-set. It’s a proven fact that most businesses (of any nature) fail. According to the Small Business Administration, approximately 90 out of 100 businesses in business today won’t be around five years from now.
Another key thing to consider is “what is your definition of failure?” Everyone who enters MLM has different goals and objectives. Many people participate just to get a discount on their products. And many folks earn a few hundred dollars per month or get their products for free each month. So calling these folks “failures” doesn’t seem right to me.
8. Can I Build More Than One Business At a Time?
You can with some companies. Most companies have a non-compete clause in the distributor agreement which prevents you from doing this. Also, I think it’s a wiser idea to focus your efforts with one company so you don’t lose focus.
9. How Big is the MLM Industry?
There are close to 50 million people involved in the industry world-wide. The industry continues to grow because of the poor economy. Many people are now looking for a PLAN B to escape the rat race. In addition, the industry does more than $100 billion per year in sales. And I expect it will one day be a trillion dollar industry.
10. What is the Best Company to Join?
That depends. I always tell folks to find a company with products and services they are passionate about AND offer a good deal to the retail customer. If the items are priced fairly for customers, you might be on to something. Also, you want to work with an established company, with a good reputation, a fair compensation plan and good company leadership. There are many good companies in our industry to choose from.
11. Should I Focus on Recruiting or Selling?
Both have their merits and what you do will vary based upon your goals and objectives. In the beginning of your business, the immediate money is made by selling products, however, the real long-term money is in the team building. I always tell folks to get five or ten customers before they start recruiting distributors.
12. How long has MLM Been Around?
This is a debatable topic. Some folks say Amway was the first MLM Company (started in 1959). Nutrilite was also a MLM Company and was about 10 years older than Amway. Plus, Watkins is more than 100 years old and they had a very similar business model to MLM, where distributors could recruit other distributors. So for simplicity purposes we will say the industry is 60 to 100 years old.
13. It MLM Better Than Owning a Traditional Business?
This is another debatable question. Here’s what you should know. MLM is not perfect. Neither is owning a traditional business. Both come with some type of risk. After all, that’s what an entrepreneur is: a risk taker. What I personally like about MLM is the low start-up costs, the ability to earn residual income, and that you don’t need employees, an inventory, or separate building. Ultimately, you need to decide what business model is best for you and do that.
14. What Can I Do to Be Successful in MLM?
To succeed in MLM, you need to pick one company that you really love and stick with it for five to ten or more years. You will never be successful if you just try something out and give up in 90 days. You can’t switch companies every three to twelve months and expect to be successful. It also helps if you develop a written business and marketing plan, find a mentor, schedule time to build your business every day, and focus on improving your skill-set and mind-set. Whether you are building your business part-time or full-time, you need to make it a high priority. You can’t wish your way to success. The bottom line is you should treat your MLM Business like you have TWO MILLION DOLLARS invested in it. Do that, and I know you will succeed.
Final Thoughts
In summary, these are the most frequently asked questions about the MLM Industry. I hope you found the information helpful. As with anything in life, individual results will always vary. You can increase your chances of success by finding a mentor, getting started, learning from your mistakes, and following through with what you start until you succeed.
What are your thoughts? Leave a comment below and let us know what you think.
Contact Us
- Warangal, Telangana, India
- 506011
- 9032224338, 9985092493 - Mohammed Inkeshaf Hussain
- inkeshaf.h@gmail.com
- 9:00 AM To 17:00 Hrs
