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As my previous post,we will look into another business model today. Multi Level Marketing or in short MLM. It has another relatives too, called Direct Selling but I’m not sure whether this is a synonym or another type of business method. However, to make thing simple, let assume, both are same.

Some example of popular MLM companies are CNI, K-Link, Sureco, Luxor to name a few. While this is MLM companies, but sometimes I also met with people selling Mustika Ratu, Amway, Revell products who said they are doing “direct selling”. Well, I would not delve into the background of MLM, maybe Curixs wil, but I will focus instead on the advantages and disadvantages of this business method.

But let’s make a few statement first:

-I know several people using these programs with success & failure and will be more than glad to refer you, if you think a MLM opportunity is for you.
-There are low-lifes in any industry. MLM/DS is no exception.

Let start with the advantages of MLM.

1)First advantage is you’re the boss of your business. You set the hours you want to work.
2)Low entry barriers. You don’t need a college education or any particular education to begin your business.
3)Start-up costs are low comapred to franchises.
4)You can work out of your home.
5)You don’t need to quit your current job. You can build your MLM business until it can replace your current income.
6)Residual Income. You keep earning a percentage of your downline sales. As long as they are selling products.
7)You are rewarded in proportion to your efforts.
8)Multi-level marketing companies have pre-defined business and marketing plans.
9)They also manufacture the product and drop ship it to your customer.
10)Many of them handle the paper work

Ok, now, what’s the catch?

Alienating your friends and acquaintances.
These are the people your upline will have start marketing to first. Your upline will have you contact these people to try to “recruit” them into the business. I am sure all of us have been approached by somebody to join their program. The big emphasis is on financial freedom for joining. Some of these companies want you to use the so-called “Curiosity Approach”. This approach certainly puts my guard up.

A better approach would be to a call your friends and let them know you looking at MLM company to make some extra money. Ask if you could drop of some products from them to try and get their opinion on them. This will be a good indication of how well your products will sell.

You need to be a Self Starter and able to lead and motivate others.
To earn the residual income, you must recruit people. This is where you make the BIG money. You have to stay on top of your downline to make sure they are actively recruiting. You need train and motivate them. Your upline should provide you with the training you need. Don’t count on somebody to motivate you though.

Financial Commitment.
Some programs require you to buy a certain amount of products every month to stay active and eligible for the program. Make the company is offering products that you are going to use. If you don’t like the product, look for a company with products you do like.

So, there you are. Another practical and proven business model, but one thing for sure in MLM business, the earliest bird get the worms! : )

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