Network Marketing: Is it worth it or is it too good to be true?

6 Questions to Determine if Network Marketing is Valid

There was a time when Lady Avon or the sales representative pounded the sidewalk selling door to door perfumes and cosmetics to neighbors. Today, anyone can reach thousands of people online as a network marketer and potentially become a millionaire from the comfort of their own home. It’s easier than ever to create a sustainable business with little or no start-up capital.

Direct marketing to consumers or at several levels

Network marketing, qualified as a sharing opportunity in recent years, includes multi-level marketing (called MLM), direct marketing, also called direct marketing to consumers and hybrids. Avon and other reputable companies have become multi-million dollar businesses through this marketing and distribution model, but newcomers often ask:

  • “Do I really want to present this to all my friends?” “
  • “Can I make money with this? “
  • “How do you know if it’s not a scam?” “

While network marketing is lucrative for some independent business owners (also known as agents or representatives), it can be a challenge for others. Here are six determinants to look for before diving in and potentially wasting your time, money, and effort on MLM, network marketing, or opportunity sharing.

1. What is the organization?

The idea of ​​earning money and residual income quickly without skill or a significant investment of money is what attracts people to network marketing . However, it is important to know who is part of the “rising line” of people above you because they serve as a helpline for creating a successful business.

So before you act, find out exactly what the First Vice-President, the President and the person who recruited you earned on an annual, monthly and even weekly basis by selling the product or service. Treat the entire bottom line like a potential new business partner who needs to be nurtured.

Their knowledge of best practices can only accelerate your efforts. If this is a newer company, find out about the founder’s background and the type of success he has had in his previous career or business. Whether it’s a cosmetics sale or long-term central services, “following the system” means teaming up with a good mentor, making decisions, and meeting people to share the opportunity.

2. What is the product?

When it comes to choosing what to distribute and sell rather than signing up for a particular networking company, the idea is to choose popular products that are inexpensive and sell well in retail stores, online or through other traditional marketing and distribution channels.

If there is competition, it means that people are looking to buy the product or service. You can then benefit from a customer portal and a back office when you start working for the network marketing company as an independent business owner. Inexperienced independent business leaders can update themselves by distributing a product for which the network marketing company offers frequent telephone training as well as quarterly or annual conferences of a regional and even international nature.

3. When are you going to start making money?

In addition to building a category-focused sales team and winning customers, MLM opportunities generally offer a bonus for recruiting and sales commissions. It is not uncommon for independent business agents to work part-time in addition to developing other, more stable sources of income.

Believing in the product or service being distributed will help the product or service to sell . If there is demand for the product that outpaces the competition, expect revenue to start flowing in just a few weeks.

4. What is the product promotion policy?

The basic understanding of a network marketing business model is that the company pays a commission to the independent representative who buys the product wholesale. The representative also finances his own overhead costs, such as credit card processing and administrative costs.

5. Be prepared to engage in marketing and promotion.

You are paid to do the marketing yourself so that the company does not have to raise its prices to pay millions and millions of euros in advertising. Some companies have very open policies that allow their independent business owners to promote themselves. Other companies provide approved materials that agents can use for promotional purposes. Approved materials may include videos and websites to protect the brand and reputation of the business as a whole. They do not want a representative to hurt their reputation because they have done something that goes against their code of ethics.

A controlled message helps maintain a good image. Whether the network marketing company offers controlled email services or not, prevention is better than cure by asking for a list of restrictions on where and how you can promote the product, for example on websites and social networks .

6. How were you recruited?

The ethical way to create a sharing opportunity is to first register people as customers. If they like the product, they will be attracted to become an independent business owner / representative. Check if the business model is focused on building a clientele or recruiting.

A difficult sale on registration as a representative at the start is a red flag. When it comes to recruiting, ask yourself if the company focuses solely on recruiting or if it is combined with customer acquisition and building a distribution team. Avoid pyramid schemes where managers of independent companies are only paid when they hire another representative and are not paid when they actually sell products or services. Think seriously about getting involved in a company that adheres to a network of business ethics.

7. Why are you doing this?

It’s good to have a vision, but don’t count on enrichment. People have made a lot of money in network marketing while many others end up wasting a lot of time and money chasing chimerical dreams. At the very least, it is safe to expect to supplement existing cash flow. It is an income and a way of life for some.

The tax benefits also go hand in hand with becoming a network marketer because you are a business owner, not an employee, and can use more tax deductions. While it is important to maintain reasonable expectations, do not expect to make a profit by contacting a client from time to time. This is the guaranteed route to a garage full of dusted products.