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Let me first congratulate you if you are a
newcomer to the world of MLM and allowing me to impart my experiences
on the industry to help you in taking the first step into this
fantastic industry.
My
intentions of writing this special report online is to help
and provide people generic information that would apply to any company
regardless on their marketing/compensation plan, product, team, country
or even offline or online!
It is
indeed a shocking truth to find out that over 95% of network marketers
or home based business owners are operating their business at a LOSS!
How scary
if you are reading this for the first time.
Well
thankfully if we all worshiped statistics fanatically, most people
today will be afraid to drive cars or even go to school (e.g. the
percentage of road accidents and how many students in a class ‘make it’
in getting distinctions)
We all
want to be smart people and rather be in the top 5% being the ones
making the money now, don’t we? Of course we do.
It is sad
that countless of poor victims join the industry, uninformed, and when
they run into problems, they usually put the blame on the company, the
team or even the industry itself!
That is
why we hope to avoid such unfortunate circumstances.
Even if
you have been involved, this information is invaluable because it might
teach you things you have missed out or information to help your
downline.
Let’s
proceed…
Why
Would You Be Choosing an MLM in The First Place
MLM survival. Let’s face it, the world out there is
like a jungle. More particularly so in the MLM world. It would be easy
to say, since it is that difficult, let’s just forget about the whole
MLM or network marketing deal in the first place (then this book would
not be necessary at all). That action would be self-defeating.
There is good news for all of us. So let us instead
start from a positive note.
The purpose of this book is not just about teaching
you to choose the right MLM Company but also how, by being properly
educated about the industry, you will be able to receive
benefits from every opportunity you invest your time and
money in. The information here will be completely generic and neutral.
I am not endorsing any company over the other as there is no
such thing as the perfect MLM but rather choosing
an MLM that is SUITABLE for YOU!
Whatever your reasons may be, let us make a few
assumptions about it before we proceed (or else you wouldn’t pay for
this E-book in the first place)
-
Making money
-
Saving money on products
-
Meeting new people
-
Growth and development
Making Money
-
Looking for fast money
-
Building a long term business with money coming in
long after you have ‘retired’
-
Investing in the product itself
For people looking for fast money, there are pros
and cons to this kind of thinking.
Some people are WELL TRAINED salesmen. They have
built the relationship with their clients, customers and all sorts of
people. People trust what they say and will trust whatever they are
selling. They may sell the product itself (sometimes, in large
quantities), or they may sell the opportunity (the money making part of
it) or both. Are YOU this kind of person?
Fast money is not impossible, but it COULD be for
the short term only. Consider the facts that 80-90% of people in the
world are NOT built for sales. If a salesman sponsors a non-salesman,
would the non-salesman be able to do the same thing as his upline? Does
that mean that I would spend most of my time looking for the 10-20% of
sales types?
The next type of money is the long term type.
When I define long term, it does not have to mean
that you might not see money right away. It differs from company to
company. But as a general rule of thumb, it involves BUILDING
A NETWORK OR AN ORGANIZATION.
The key to building a large organization as quoted
by Zig Ziglar, “You will get whatever you want in
life if you will just help enough other people get what they want.” In
other words, if you will help enough downlines get enough downlines,
you are on the road to network marketing financial freedom. The key is
to help others.
There is one more category of people who ‘invests’
in network marketing companies, not to make money through retaining or
networking, but rather investing in the product, position, or depending
on the company, appreciation of their ‘assets’. A few examples would be
investing in a product, so that in the future,
its value will appreciate, so you can sell it to other people at a very
high margin (sort of like old comic books.) Others might purchase
the account or distributorship from you (depending on the
compensation plan of the company) while some Internet companies
actually pay you to ‘invest’ in their company, sort of like buying
a share of the company.
Saving Money on Products
Retailing of a product is very important to an MLM
business. Lack of (or even non-existing) retailing could be harmful to
the distributor or the company as certain states have outlawed
‘headhunting’ and have their own policies.
Nevertheless, saving money on an MLM product is one
of the most wonderful key features of joining an MLM company if
recruiting is not your forte.
In certain compensation plans, repeat purchase of
the products you buy from the company gives you more rebates or
bonuses. In essence, the more you buy, the cheaper it becomes. This
becomes an even greater pleasure if you are totally in love with the
products or you have already set aside a budget for those products
(which means you are now buying from the MLM company or your upline
instead of buying from the supermarket, pharmacy, grocery store, etc)
There are some important aspects to take note
however, if the company requires you to purchase the products in bulk
(hence the term – frontloading), is there a DEMOTION
in your achieved position in the company, is there MAINTAINANCE
required, or how much are the renewal fees for membership. All these
will be further discussed in the later chapters.
Meeting
New People
This is one of the many reasons why people join MLM
companies (even if the first two reasons discussed above don’t even
concern them). There are all types of people in the world. Some like
the positive environment. Others like the social events the company or
team organizes. Some look for a potential life partner there!
Lots of people even go all out to join these kind
of businesses to get more contacts for their OWN BUSINESSES (maybe even
THEIR OWN MLM BUSINESS). Bear in mind one thing. There is this old
saying that goes, you scratch my back, I scratch yours. If you
participate in their activities but don’t go full force in their
company/team vision, don’t expect them to join you or buy from you.
There may even be negative repercussions (such as being banned from
coming back to the company).
Growth and Development
One of the biggest reasons why I would recommend
joining an MLM company and doing the business is opening your mind to
positive thinking and achieving your full potential. There are many
companies out there who have the best training courses, motivational
rallies, sharing sessions and whopping transformation camps that will
not only fire you up but take your business building to the next level.
I will not touch much on this subject extensively
here. There are so many companies out there that will do a fantastic
job in terms of training.
Remember that growth is a journey and not a
destination.
Types
of People Who Are Looking For Opportunities
Remember that people join MLM companies for their
own reasons. However, the character or intention of a person will
determine how far they want to go in MLM. Here are classic examples of
different types of people
-
Genuine business opportunity seekers and builders
-
Product consumers
-
The supporters
-
MLM junkies
-
001 syndrome
Genuine business opportunity seekers are the most
important people in building a large business. They are the bread and
butter. Not all are leaders but leaders are not born, they are
developed. This group of people also can be product consumers.
Product consumers are people who join an MLM and
buy from them because they like the product and enjoy the service of
their upline. They are not necessarily genuine business opportunity
seekers or builders yet for many builders, a lot of their income will
come from this group. The good thing about them is as they learn more
about the product, the company and interact more with their upline,
their exposure to MLM grows and they might convert to opportunity
seekers and then builders.
The supporters’ category is quite a mixed match of
people. When their close friends or relatives build an MLM, they will
join under them to ‘support their businesses. However, the consequence
of that action varies according to the individual. For example, I would
join my friend’s organization but it could be purely out of obligation
and not for any genuine reason. This could potentially lead to
resentment (when you mix business dealings with friendship), confusion
and even loss of friends. Others might even join to see if their friend
or relative is involved in a scam to try and pull him or her out. In
order to prevent any potential disaster, make sure your intentions for
joining an MLM are very clear cut.
MLM junkies are the sort of people who jump from
MLM to MLM (some people even call them Multi-Level-Monkeys). They
attend a talk, get hyped up about the opportunity, and build the
business on euphoria. Sooner or later, they lose steam and find
problems with the company (when the real problem is themselves most of
the time) and jump to the next SMOKING HOT business opportunity. It is
not wrong to be a member of many MLM companies (depending on your
budget). Bear in mind, certain companies discourage or even forbid you
to join other companies (then their business practices should be
examined). If you are a member of many companies, it is ok to do a good
survey and attend trainings, but the key to remember is you must focus
on ONE good MLM for the long run and the others can operate on a
referral basis (like recommending a friend to buy a product from
another company while building one main one).
This leads us to one more category of people who
could be MLM junkies as well – the 001 syndrome.
Basically they want to be the first to start building a business in a
brand new start-up. They want to be the pioneer. There are many pros
and cons to assess about a new company like their background history,
financial status and product market rather than just focusing on the
income potential. There are many more challenges to be faced for people
who are sponsored directly under the company and new companies don’t
usually have a time-tested workable system in place.
If you fall into one of the above categories (or
even some or all of the above), these will give you a general guideline
on how to improve your choice selection of MLM companies before we go
in to the details about compensation plans and product demand. By
knowing yourself better, you can do a better assessment.
001 syndrome.
Basically they want to be the first to start building a business in a
brand new start-up. They want to be the pioneer. There are many pros
and cons to assess about a new company like their background history,
financial status and product market rather than just focusing on the
income potential. There are many more challenges to be faced for people
who are sponsored directly under the company and new companies don’t
usually have a time-tested workable system in place.
If you fall into one of the above categories (or
even some or all of the above), these will give you a general guideline
on how to improve your choice selection of MLM companies before we go
in to the details about compensation plans and product demand. By
knowing yourself better, you can do a better assessment.
What
is the MLM Jungle Like
There
are thousands of MLM companies out there! Here are a few categories of
MLM. These will help you determine which company suits you.
Product/Servicing
Traditional
MLM
Concept
Physical
product
Internet
MLM
Digital
Product
The main difference between traditional MLM and
Internet MLM is the method used to recruit or sponsor. Traditional MLM
relies mostly on one-on-one prospecting (like at a McDonalds or
Starbucks), home party, opportunity meetings or rallies. Internet MLM
does the recruiting through e-mail, newsletter, forums, websites and
sales letters. This minimizes the human interaction part and may be
more suitable for those who are not very good at talking to others.
Two main types of traditional MLM are one that is
heavily concerned with retailing, consumption or distribution of a
physical product. Typically one with a high volume of repeat sale (like
vitamins or skin care products) and good testimonials of the product
with high visibility (e.g. look at my skin, the product has cured all
my pimples!).
Concept MLM doesn’t focus as much on products
compared to its former counterpart. They usually do have a product, but
it doesn’t have as high a repeat sale as those mentioned above. Most of
them run their business like a club. Some are like lifestyle clubs.
Others conduct their business with a high degree of professionalism
(they all dress better than an office worker). Often they will sell
their people a dream or molding them to a particular image to convey
the image of the company for attracting more recruits. It’s the sizzle
that sells the steak.
In Internet MLM, there are distributions of two
types of products. A physical product distributed through the Internet
means that the Internet does the selling and recruiting, taking the
orders, and the shipment of the product are done offline. Digital
products remove the headaches of physical product distribution. This
usually gives the company a better margin due to lower overheads (no
warehousing or shipment).
Exposure to the Industry
In the MLM industry, there are a few factors to
consider when considering which company to build a long term business.
Product background
Marketing or Compensation plan
The team (Upline, Sidelines, even the
company staff)
The trend of the time
First off: It has been said in
the past – your UPLINE chooses the first company you join. It still is
the case today for many who are either unexposed and their friends or
relatives who join an MLM first approaches them.
The unexposed might oblige their upline and if they
are not careful, will cause a very bad first impression on the industry.
Today, you don’t need to be picked by someone else.
You can choose first. Do a good survey based on the guidelines above.
As a matter of fact, you don’t even need to join the first person who
invited you in a company. You have a choice to choose someone else to
be your upline within the SAME company.
Products are very crucial in MLM. Just because one
company says our product is the ‘best’ doesn’t mean that it is. Just
like any other business, people seriously building an MLM will only say
good things about their own product. They will even give fantastic and
even outrageous testimonials about how the product can help them.
Many are very sincere and well-meaning, but the
rule of thumb to remember is – yes, you say the product is the best,
but that is also because you haven’t tried any others because you are
in this business!
I firmly believe that most MLM products are of
exceptional quality. That is because the product must work then only
can the distributor give good testimonials due to the nature of the
distributor doing direct sales (dealing directly
with the prospect/customer). There are companies that DISCOURAGE their
people from using products from a competitor MLM (some even ask you to
stop buying from the supermarket and buy from your ‘own business’
instead).
Beware:
some even go as far as to talk down about the products of other MLM
companies. Most people, in their zealous zeal to recruit others, may
use this tactic. This is often perceived as rather unprofessional.
Bear
in mind: in MLM, if you talk bad about other MLM companies
or their products, you are talking bad about the entire industry as a
WHOLE (you mean to say that only your company, product, compensation
plan, team is the best in the world and the rest of all the other
companies are of inferior quality? Man… I don’t want to be in this
industry.) Can you imagine if every network marketer is doing this? No
wonder the industry has a bad name!
The Marketing or Compensation
Plan
The plan is very important. It shows how much work
you need to do to get paid this much. All marketing plans have their
own advantages and disadvantages. Different companies offer different
margins for their products. The key to remember in margin comparison,
if the company pays the distributor too low, you might not survive; if
the margin is too exorbitantly high, you might earn a lot, but your
retail customers will suffer and the business might not be long term.
Before I share with you a few more popular type of
marketing plan to give you an idea about what company will offer what,
I wish to highlight two things in every plan: DEMOTION and
MAINTAINANCE
DEMOTION means dropping from
one MLM position to a lower one (usually resulting in a loss of future
potential income) or your remainder quota required to reach a certain
target is increased (the volume achieved in the past do now count
towards the grand total anymore) Demotion is an important factor to
consider in every marketing plan as someone who suffers demotion
suffers a sudden loss in income and could be very embarrassing to
others.
MAINTENANCE (sometimes called
autoship) is the minimum amount of sales volume (usually every month) a
distributor or serious business builder has to buy either his own
personal volume or combined with group sales in order to maintain his
rank, be eligible for bonuses, overriding commission or sometimes even
maintain his distributorship. Having maintenance or no maintainance all
has its pros and cons. I will highlight 3 scenarios to give a clearer
picture.
A) MANDATORY MAINTENANCE
Some companies
require you to purchase products every single month. This is good if
you have built a large organization and it ensures you have guaranteed
income every month. Not good if you are forced to maintain and you are
not making money in your business. If you are in love with the product
and don’t mind paying for it every month then it is fine. But this can
cause a person who is not seriously building or is still struggling
with his business some pressure and it is one of the main causes of
drop out in MLM.
If the
maintenance is too expensive, people might shun the company. However,
the upline with a lot of people in his group can build a large stable
income this way. Some companies may not require you to maintain at the
early stages and increases the maintenance after they achieve a certain
rank.
B) NO
MAINTENANCE
This is very
good for people who have just started their business or for people who
is just casually ‘trying out’ an MLM. There is no pressure and a person
can be in an MLM for years but still at the same rank.
The bad news is
that it might not be good for the long term (because no maintence means
no downlines need to buy anything) unless your group is in love with
the product or if you and your downlines have built a solid customer
base and the demand of the product it there.
C)
OPTIONAL MAINTENANCE
This is also
very good for people who just started or the casual type. They will
only ask you to buy a certain volume of products when you want to
override your commission from the company. This is also very good in
the sense that you are not pressured to pay maintenance
and you only pay when you are making money.
There is one
problem with this, however. Among the serious business builders if the
downlines are not producing any sales, even having a large organization
will not pay you well if not at all (just like a zero maintenance
company, no downline sales means those in the middle will not maintain,
causing a chain reaction all the way to the uplines at the top). This
is a hollow organization where your rank/title means nothing without
income.
Next, I will go in detail about the
more popular types of plans…
1) The
Stairstep
2) The Unilevel
3) The Binary
4) The Breakaway
5) The Matrix
6) The Australian Two Up
7) The Hybrid
1) The
Stairstep
Grand
Emperor
Emperor
Champion
Leader
Noble
Peasant * Purely for
illustrational purposes only, not actual
The Stairstep or
step and ladder plan is a simple plan that has requirements that you
must meet to get up the “Stairs of Success” Every step is a promotion
usually based on achieving a certain volume and each promotion or rank
gives you a larger cut.
Demotion in stairstep plans to
ensure a distributor’s group commits to a certain volume every month.
It gives a particular rank a guaranteed income. Demotion in this case
means that you must either maintain a certain volume every month (or
quarter or fiscal year) in order to maintain that rank. Let us say for
example, Anthony achieves a sales volume of
$200,000 in his entire team (for a certain timeframe) and that promotes
him from Leader to Champion,
certain companies require him to keep up that same sales volume the
next time or else he will be demoted back to a leader. In certain
plans, there is no demotion in rank, so the group sales are accumulated
for reaching the next level.
Maintenance here
plays a key factor how building a solid group will look like. If there
are low repeat sales for the product being marketed, expect the minimum
entry fee to be higher than the average MLM. This is because
low repeat sales means less maintenance hence the majority of the
income comes from recruiting new blood. If nobody does maintenance in a
Stairstep plan, having a high rank doesn’t earn you money so don’t be a
fool if someone tells you that the ‘minimum’ income for a ‘grand
emperor’ is $100,000 a month – it all depends on the volume generated.
On the contrary, plans with maintenance involved do guarantee an income
or else you will not be in that rank.
This
type of plan is one of the oldest and longest plans around. The
advantage of climbing the ladder gives major incentives for
distributors to work harder and fight for the target. The larger your
group the more you override even up to infinity levels as long as your
downline is of a lower rank than you. There is also a fair system
involved lets say if your downline works harder than you and sponsors
more people, he can actually have a rank higher than you and that is
when breakaway in certain plans come into
play (discussed in the breakaway plan below)
The disadvantage however, is once a
downline reaches a certain rank (lets say you need 3 directly sponsored
leaders to qualify as a champion),
one of them becomes a leader while you focus on
making the remaining 2 groups to become leaders, the first leader might
be neglected in the process. The other disadvantage is if the downline
is too far deep in the organization (lets say your downline’s downline
all the way down 10 generations), some distributors may neglect helping
them because the monetary incentive is too small.
2) The
Unilevel
The Unilevel is a
simple “Number of levels” that the company will pay you, and usually
there is no promotion or rank. You make money by getting a certain
override off of the volume, and usually there is a requirement of
volume to qualify for a check.
The advantage here
is you don’t have work your butt off during certain seasons to fight
for that rank. You can sponsor as many people as you can and your
income comes from a large volume of people in your organization. For
example, you can personally sponsor 5 people, and these 5 will look for
5. after 4 generations you will have 5 to the power of 4 in your
organization (780 people) and the calculation of your sales volume will
give you a straight forward income.
The disadvantage
however, is there is no incentive for developing many different groups
(called legs). In spite of conditions in a plan imposed by the company
(that you have to sponsor a minimum number of legs) some unilevel
people tend to let the ‘strong’ downlines do all the work as in wait
for their downlines to sponsor MORE people than themselves, which is a
poor reflection of leadership.
In the Unilevel,
there is no demotion (the only demotion is leaving the company) and
maintenance plays a key part in the long term income.
3) The
Binary
The Binary is an interesting design
for a Comp Plan. It usually has 2 “legs” that you can have “Business
centers” in, and you have a volume requirement to get paid on each leg.
There is what is called “balancing”. in the Binary…you must balance the
volume from each both A and B group to make sure you maximize your
commissions. In the illustration above, the A group
is the strong leg (or the giant leg) while the B
group is called the weak leg (or the profit leg). A has more people
than B (assume they all produce the same volume per person). B needs to
find 2 more people in order for U to ‘balance’
hence maximizing U’s income.
The main advantage
of this plan is spill over. Allow me to illustrate
U sponsors 2
friends. In a binary, the company limits each distributor to have a
MAXIMUM of 2 people. A and B
were previously recruited by U. U
needs to ‘balance’ his group by helping B find 2
people. But let us assume that B is not actively
building the business at the moment, so what does U
do? He finds and sponsors 2 people HIMSELF and places both of them
under B and they become B1 and B2. This is called SPILLOVER.
The advantage of spill over is that
when everyone works as a team, the tree will fill very fast as all
uplines and downlines work together to balance each other’s networks.
It is also immune to the problems in unilevel or stairstep plans with
downlines being too deep in the organization. A binary can be balance
depending on which side the downline is in and not
how deep.
The disadvantage
however, is that this plan is particularly attractive to lazy people
who don’t do any work and expect free handouts from their uplines.
Imagine what will happen if everyone waits for their upline to place
people under them? It doesn’t develop strength.
4) The
Breakaway
This plan has been
said to have become somewhat unpopular in the industry, as you could
lose the business you build, once it gets to a certain level of
success, and it “breaks away” to no longer be a part of what you get
paid on. It usually appears in stairstep. Lets use the example above in
the stairstep illustration.
If I am a Champion
and my downline builds his organization faster than me, and qualifies
as an Emperor before me, 2 things might happen.
Depending on the company’s pay
structure, I will not be eligible to receive overriding commissions
from my downline Emperor’s group. Hence the
‘breakaway’ his bonuses will be ‘passed up’ to MY upline Emperor
or Grand Emperor. In some cases, the ENTIRE group
breaks away and join MY upline so even if I do qualify as an Emperor
later on, I will not receive bonuses from his group! Selfish people
might even involve in SABOTAGE as in trying to slow down his downline
from breaking away or overtaking him.
Today, more and
more companies are acknowledging the breakaway problem and will start
awarding leadership development bonuses (such as a fixed bonus
percentage over that entire group even those they have broken away).
This system has still worked out well in the past though, because it
gets people working harder to prevent the breakaway from happening.
In MLM (just like
in life), companies reward PEOPLE who work hard to build their groups.
If a downline works harder than his upline, he should get paid more –
hence it is more fair to them. So in this case if an upline doesn’t
work hard enough, he shouldn’t blame the company if the downline breaks
away.
5) The
Matrix
The matrix or sometimes called a FORCED
MATRIX is like a pre-order tree. A computer driven plan puts
into your group by computer, and they go in the next available slot.
Usually this plan is combined with some form of a Binary (sometimes 3
by 9 or 5 by 25 matrix depending on the maximum ‘width’ allowed), and
it does work well if there are a lot of people that are recruited and WORKING
TOGETHER TO FILL THE MATRIX. When you recruit someone, the
computer searches down for the next open slot, and positions them
there. There are some plans that allow you to override the commission
of those that you personally sponsor even though they are not
positioned directly under you within the tree.
How the computer
works is like this:
D sponsors a new
friend. That new friend doesn’t get slotted under D
but rather fills the last position which is the dotted line under C.
Once they fill up to a certain level, the distributor gets paid a lump
sum.
Once again, the
advantages here is that every single distributor in the tree all work
together to fill the matrix and the duplication result is fantastic!
Imagine if everyone finds 2 and everyone does the same thing, the
matrix will be filled very fast. This means that even if you don’t look
for ANYONE to join the company, you will get paid when the tree reaches
a certain level.
The biggest and
most obvious disadvantage is everybody waiting for everyone to fill the
tree thinking that they will get their money waiting for others to fill
it. This kind of thinking is EXTREMELY WRONG and will ruin the company.
Furthermore, unless there is a cut off system in the marketing plan,
(for example, after the sixth level the person at the highest position
will have to reinvest again at the bottom of the tree), the guy who
‘came first’ will get all the commissions and not do anything. By
placing a cut off point, everyone who reinvests again will fill the
tree faster as the deeper you go down the tree, the more people are
needed to fill each level.
6) The
Australian Two Up
This is a marketing
plan that is very unique. Basically, the two people you recruit are
‘given’ to your upline sponsor and the rest of the recruits are yours.
Here is an illustration:
Q1
Q2
Assume that each person you
recruit, you are eligible to earn $100. U sponsors Q1,
Q2, A and B. You earn ONLY on A and B but not on Q1 and Q2 as
those sales go to your UPLINE SPONSOR. Q1 and Q2 are your qualifying
sales. Basically by finding Q1 and Q2, you have basically qualified to
earn from A and B and subsequently C, D, E and as many as you would
like.
S
Q1
Q2
imilarly,
A recruits A1,
A2 and Z. The sales of A1 and A2 goes up to U
and the sales of Z goes up to A. As
long as U keeps Q1 and Q2
going, he is eligible to earn as wide as he wants and as deep as he
wants! (A1 and A2 is now part of U’s group. This
will multiply by 2 each time it goes deeper enabling him to earn income
up to Infinity levels!)
The biggest disadvantage of this
plan is that sometimes people are selfish and will only leave U
with ‘weak’ distributors (for example, Q1 and Q2 are slow learners)
while capitalizing on the stronger ones in A and B (leaving the strong
ones for themselves). Some might even purchase dummy accounts (known as
‘cats and dogs’ or ‘potatoes’) This leaves their upline with non-moving
legs and creates a hollow organization. Some companies deal with this
problem by giving bonuses or special overriding mechanisms where you
get special bonuses for building them, or even removing the ‘qualified’
status should Q1 or Q2 drops out.
7) The
Hybrid
A hybrid is a
combination of any of the above features. An example would be a Forced
Matrix with Unilevel benefits (ensuring that those who actually WORK to
fill the tree gets paid more), or an Australian Two Up with Stairstep
advancement (to offset the disadvantages of distributors being too deep
in an organization)
Many companies that
are combining the advantages of many plans to help distributors
maximize their income.
REALITY
CHECK: Regardless of how good any plan may sound, NONE OF
THESE PLANS WILL MAKE YOU MONEY IF YOU DON’T SPONSOR ANYONE AND DEVELOP
THEM.
Only YOU can make the plan work for without you,
the plan is dead.
DO NOT get too complicated about Compensation
plans. Keep it simple while explaining to your prospects and make sure
you understand that you CAN MAKE MONEY with it if you work your plan.
The 3 General Areas to make money in any
MLM plan.
1) The
First area is Retail Profit.
You must show the
prospect that they can earn a retail profit with your products and
services. The margin can be anything from 10% to 50%.
2) The
Second Area is Team Overrides.
This is where, just
like a Real Estate broker, or Insurance agency, you get to develop your
own sales team. ‘Sales Managers’ get paid a certain % of override off
of them, just like the Real Estate and Insurance Agents do. Your goal
is to help your people do the same thing. People don’t understand that
you have to help people or help your team in order to succeed. If they
achieve success first, then only you will succeed.
3) The
Third Area is Leadership Bonuses.
This is where you
help develop Successful leaders in your group, and you get an
additional bonus or override form your group. You get rewarded by
helping others develop their leadership potential. Once your leaders
are in place, your MLM business will go on autopilot.
The
Team (Upline, Sidelines, even the Company Staff)
Joining the right team is also crucial in MLM. No
man is an island in this world. Uplines will always be there to help
but the attitude to be adopted is that I am in business for
myself but not by myself. Since I am in business for myself,
I am the master of my fate, I create my own luck, and I am the author
of my own book – it all boils down to ME. Having an upline to help you
is considered a BONUS. If you were to run a traditional business, would
you expect other people to open shop for you and close the shop for
you? Same goes in MLM.
Like wise, you have to be a good, responsible
upline as well. No one has succeeded in any industry without learning
and MLM is no different. It is the upline’s responsibility to guide,
train, teach and motivate the downline. New people in MLM without
guidance are like sheep wandering into a wild forest – what are their
chances of survival? It is no wonder 95% of Network Marketers fail to
break even. The upline must lead them, empower them but must never
spoon feed them. Uplines must not be abused. If you give a
man a fish, he will feed himself for a day. Teach him to fish, and he
will feed himself for life!
Sidelines or Crosslines are people not in your line
of sponsorship. Why should I bother with sidelines? They are all
somebody’s downline. Somewhere ‘up’ the line they are probably in one
of your upline’s group. Many companies now encourage sideline team
support. Because you will always have more sidelines than uplines and
downlines, it is crucial that side lines help one another. One upline
has limited time and resources, but if sidelines work as a team, you
leverage on more people.
Developing a good relationship with the company
staff is also necessary for success. Imagine if you are holding a team
meeting and you need them to arrange or prepare the rooms for you.
Getting shipment on time for your products? Check with the staff. If
you have a good relationship with the owners of the company, it is also
a great advantage for moving in the same direction together. This is
even more so for pioneers with a new company, the first batch of
distributors and the owners of the company must work closely together
to bring the company to success.
The
Trend of the Time
One last aspect to consider about a company is the
state of it’s current market trend. Many people at one time or another
has heard about aggressive marketing and campaigns on certain companies
based on the need for their product and how hot the opportunity is at
the moment.
They could be in the pioneer stage, marketing the
latest health products to a growing or maturing market (for example,
aging baby boomers). Some could be in a mature stage after surviving in
the market over 10 years.
The comparison of the new, smoking hot companies
over the mature, or aging counterparts have its pros and cons. New
companies are not vulnerable to saturation. Collaboration with new
companies put you in positions of power where you can negotiate with
the management team on the direction of the company or even enhance the
marketing plan. People who has heard of those new companies may jump on
the opportunity and it is generally easier to create a large group in a
short time.
This does not mean you should not join older
companies. Older companies are more stable and has survived the times.
They have run a time tested system which has helped many people to
succeed. International companies are even more reliable as they have
the manpower to tap the international market. Think of McDonalds. They
have been around for so many decades yet people are still profiting
from them today because they all follow a system.
There
is No Such Thing as a Perfect MLM
In spite of all there is discussed above, certain
companies may claim they are the best. Different companies market
different products and they all claim to be the best in their line.
Each claim to be selling the best skin care, nutrition, aromatherapy,
insurance programs, investment opportunities or even online digital
products.
Let’s face it. There is no such thing as a perfect
MLM, just there is no such thing as a perfect church or perfect
government. MLM companies are just like normal companies in the sense
that there will always be management problems, staff problems, cash
flow problems, shipment difficulties and product faults.
Take the skin care industry for example. There are
many skin care products that have long histories, extensive research,
powerful testimonials, and so on. But no matter how good the skin care
is, they will not benefit EVERY SINGLE PERSON ON THE PLANET. We are all
different. Some has drier skin. Some are more sensitive. You can’t
prescribe a drug that will cure everything for everyone.
Likewise with teams. Certain teams are more
suitable for younger crowds with all the excitement and the hoo-hah
going on. Others are for a more mature crowd.
All this I am highlighting will lead to my next
point in the next chapter which is:
An MLM That Would Suit YOU
Understanding this principle could save your MLM
life. Many people label everyone who joins more than one MLM company a
‘junkie’. It is true that there are junkies that goes around recruiting
their friends when he tries COMPANY A, dies a natural death after a
while and joins COMPANY B. He starts talking to the same friends how
good COMPANY B is and always talk bad about COMPANY A. Then he quits
COMPANY B after running into some struggles and joins COMPANY C, does
the same thing promoting C while talking bad about A and B and goes on
and on.
No. I am not teaching you to be a junkie.
I have explained in the previous chapters that even
the ‘best company’ in the world would not be suitable for everyone. I
may LOVE supplements for my health and buy it from the ‘best health
supplement opportunity in the world’ but my passion is being on the
Internet! Don’t get me wrong, the supplement company would have a
FANTASTIC TEAM, a SOLID COMPANY BACKGROUND, and even an UNBELIEVABLE
COMPANSATION PLAN. But I prefer to sell digital products. I don’t care
if I don’t get to meet or socialize as many people in person on my
Internet MLM, I don’t even care if I don’t operate at an office! I am
making money at my Internet MLM.
I think we get the picture now…
Here is another scenario. What do you do when you
are already in one MLM and a good friend approaches you for another? Do
you refuse? Remember, you must not treat your MLM business like a
RELIGION. I don’t refuse because I will always find benefits in every
MLM company that I join. I may like the products there. I can SHARE
these products (for example, supplements) to friends who do not believe
in buying on the Internet! No single company will cover the ENTIRE
market so we have to be realistic. I may even join that company so I
can build relationships with them and get them to try my own MLM
products too! If I don’t keep an eye out for other opportunities, I
don’t feel that I am a good business man. But you must FOCUS on one
business, some may say. Yes, I focus on one, but I also open the door
to many other potential customers too.
Always be open to new opportunities and cross sell!
That’s where you put the ‘network’ in network marketing. But don’t make
the mistake of joining every opportunity just to get people because it
costs you time and money and only join different MLMs if you see a
tangible benefit.
If you don’t make it in your first MLM, don’t
despair! People make mistakes and they (hopefully) grow wiser the next
time they choose again. This is what I hope for all who read this book
because you must never give up when you fail the first time. Most
people don’t make it in their first MLM but they might succeed in the
second or third.
Being Aware of the Risks
In any business dealings there are always risks –
Same in life. Drive out the door today and there are always risks of
accidents. How to minimize your risks also depends on your own judgment.
Before joining a company, you must always remember
in MLM that if you want to make serious money, you must be prepared to
be in for the long haul. There are people who tell themselves, if I can
make $500 to $1,000 part time/on the side, I would be happy. They do
not set their goals high and what happens? They give only part time or
half hearted effort which often doesn’t even help them make the $500
that they wanted in the first place!
Others think to themselves, that if they can find
that ONE opportunity, I’ll be one of their first and look for 2-5
downlines, which will do the rest of the work (network building) then I
will be set for life. MLM requires HARD WORK. MLM is a business that
appreciates in value OVER TIME. Which would you rather earn?
$10,000 a day every month?
OR
$0.01 doubling every day per month?
Ten thousand a day would seem like a lot of money
on the first day compared with getting one cent on the first day? Most
would choose the first option, but consider.
$10,000 * 30 days is $300,000. If 31 days, then it
would be $310,000
1
cent doubling every day would product a whopping $5,368,709.12!!!
If we add one more day the total will be over 10
million!!!
Don’t despair if you don’t make substantial money
over the first 6 months. Those are your TRAINING months. Remember
again, NO ONE SUCCEEDS IN THE MLM INDUSTRY WITHOUT LEARNING AND HANDS
ON EXPERIENCE.
Learn to pace yourself. Rome is not built in a day.
But do it at a proper pace where you know your financial limitations.
Ask yourself:
-
Can you afford the joining fees?
-
Are you prepared for the obvious overheads like
petrol, food and training materials?
-
If you don’t make money in the first six months,
can you survive?
-
Are you prepared to cut down on your luxuries so
you can work out your business?
-
Are you prepared to LEARN?
Getting Started Off The Right
Foot
Once you have answered all the questions in the
previous chapter, you begin your journey.
Attend trainings repeatedly and listen to your
upline. If your upline is not qualified, the keep going upline until
you find someone who can coach you or mentor you.
Once you have downlines under you, you must be
prepared to be a leader and duplicate what your upline has taught you. DUPLICATION
is the key to building a long term business because
your downlines are able to do the same thing you are doing. Many
successful leaders in MLM are fantastic speakers on the stage and
powerful trainers in the field and even write books on how to succeed.
One of the biggest mistakes a new distributor usually makes are buying
a ton of books thinking they will be well equipped to go ‘out there’
and create a sponsoring explosion. You may try to imitate your leader,
talk like them, look confident or even walk like them. But the tricky
part is duplicating the charisma or having the same influence. Even
after reading all the books on self-improvement, the tactics might not
work because you don’t have the same charm as the author!
I am not saying don’t read books or buy books.
Factual information or education is usually more helpful in making a
good decision. I have compiled a reading list at the end of this book
that will give good facts. But trying to become like another person and
using his or her ‘techniques’ will often lead to disappointment with
the book itself! They become disillusioned and go on to buy another
‘key to success in MLM’ book and the vicious cycle repeats itself
again. Eventually they become disillusioned with books and they will
stop reading all together.
KEY POINT TO REMEMBER:
LEADERS
ARE NOT BORN, THEY ARE DEVELOPED OVER TIME. THOSE WHO
SUCCEED IN MLM WILL HAVE TO PAY THE PRICE OF LEARNING AND GROWING.
THOSE WHO SUCCEED QUICKLY IN MLM HAS ALREADY PAID THE PRICE OR WERE
LUCKY ENOUGH TO FIND DOWNLINES WHO HAD ALREADY PAID THE PRICE.
ARE YOU PREPARED TO PAY THE PRICE?
In
a Nutshell
MLM is not an easy road to walk on and there will
be many obstacles along the way. That is why choosing the RIGHT company
is of utmost importance as the journey of a thousand miles begin with
the first step so I hope everyone reading this will take the first step
in the RIGHT direction.
Regardless of success or failure, MLM is a journey
worth traveling on because of the things you will learn along the way.
It is priceless.
It is with my sincerest wishes that all who read
this book would achieve tremendous success in the MLM journey.
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