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Choosing The Right Multi Level Marketing Business Opportunity
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Have you ever jumped into a pool without checking to see if there was water in there first? Hopefully not, but that is exactly what many people do when they join multi level marketing companies.
When I was looking into signing up as a representative for a specific multi level marketing company, I considered a few things but wish I would have known what to look for and what things would trigger red flags. I have compiled a list of things that you want to research before signing up with any mlm company: signup fees, the company’s track record, support from company and upline representatives, compensation plan, and demand for type of product or service.
Signup fees usually range from $100 to $500 with most multi level marketing companies. Obviously this is not a huge investment compared to starting a traditional business or franchise, but still needs some consideration. The get rich quick mentality plagues the multi level marketing industry which causes some to believe that just by signing up as a representative/distributor the money will begin to flow. That being said—don’t sign up unless you plan on WORKING HARD otherwise you might as well flush that money down the toilet. Also, find out what the annual recurring fees are for being a distributor; they do exist.
Pros and Cons exist for both start-up and more established companies. With start-up companies, the risk is greater in that the company may fail but the reward may possibly be greater because you would be in at the beginning and on top of all the potential growth of the company. The more established companies have a track record and are usually more stable and less prone to fold. The growth potential may not be as high as start-ups but generally speaking, there is always more room for growth.
Pay attention to the support that is given to individual representatives not only from the company as a whole, but from your potential upline. (Upline is defined as the people above you who are trying to recruit you into the business and will benefit from any sales that you generate.) Company headquarters should have regular trainings that–well, TRAIN. Hype is good only to an extent; training on how to acquire customers, recruit representatives to be in your downline, and how to train your new recruits to do what you are doing, is crucial for your success. Your upline should help you to launch your new multi level marketing business opportunity and should be there for support when needed. Their success depends partly on your success, so normally they will be more than willing to help. The key is to sign up under someone who is treating the opportunity as a business rather than a get rich quick scheme.
Study the compensation plan for your business and make sure you know exactly how and when you get paid. A lot of money can be made in multi level marketing but understand the big money is made when you know the compensation plan forwards and backwards and follow that plan to the “T”. The most important aspect to look for in a multi level marketing compensation plan is to make sure that no money is paid out UNLESS a customer is acquired to use the service, widget, or doodad that is marketed. No money should ever be paid out just for recruiting representatives; this creates an atmosphere of recruiters recruiting recruiters not focused on selling any products. On the other hand, if a bonus is paid out for when the newly recruited representative acquires customers, all is well.
Lastly, make sure there is a demand for the product or service that the multi level marketing company offers. Low demand is not usually a problem because most companies don’t try to market something that won’t sell. But keep in mind, a lot of multi level marketing companies market new breakthrough products where the demand needs to be created and can be a more difficult atmosphere to succeed.
To wrap up, do your homework to be able to make a more informed decision. Even if success doesn’t come as soon as you would have liked or not at all, you can rest easy at night knowing that you made the best decision you could have made with the knowledge you had at the time. But remember, knowledge is only half the battle, so ACT and PERSIST!
Dave Stone posted a list of questions that you should consider when doing due dilligence regarding a company on his blog. He borrowed the list from the book “Network Marketing For Dummies.”
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