Frequently Asked Questions About MLM
© 2007 Bonnie Ramsey
Why would I even bother with an MLM or Network Marketing business that doesn't pay me an hourly rate for the work that I do? Aren't they really hard to build? Won't you chase your family and friends away?
These are just a few questions that I hear in the MLM/NM business and I would like to address them, as well as a few others, in order to help you to better understand why we, as MLM/NM members choose to do what we do and why we have learned the advantage of the "delayed satisfaction" that you here spoken of in this type of business.
First of all, you should understand that while this side of the business does take time to build and your income may not be recognizable for a while, the option for immediate income is open through the sales of your products. Therefore, you do have an option to earn as you build your business. That being said, let's begin with the first question:
Q: Why would I even bother with an MLM or Network Marketing business?
This answer is pretty simple. FREEDOM and SECURITY. If you choose to build a team in your business, you are working toward building your future in a way that you will never have to worry about lay-offs, cut-backs, illness, retirement and all of the other aspects of working for someone else. While you may retain an hourly pay for your current work, it is reasonable to assume that your company is not going to pay you for hours you don't work. For example, let's say that you have been with a company for several years. They hire on some new workers and assign you the task of training them. Your pay doesn't increase due to this extra responsibility but you may possibly get a few hours of overtime during their training period so you take on the task.
Now, a few weeks later when this person is fully trained, you go back to your normal work schedule and work a few less hours. This is a pay cut since you are no longer getting the extra hours in to train the new hire. In a sense, they just cut your pay as a "thank you" for the hours that you spent training this person. The only way that you will get more income from training again is to keep taking on new trainees and keep working the extra hours to maintain the income. Does this sound familiar?
On the flip side, if you take on a new team member in your MLM/NM business and train your new member, you will begin to receive a check on the performance of that member and continue to be paid for as long as the member remains in the company. The more productive the member, the more you earn. This is a continual payment or "residual" for the time and effort you put forth to train that member. So, I have to ask, which one would you prefer?
Q: Aren't these types of businesses hard to build?
I won't lie to you and tell you that it is easy because it does take time and effort to be successful in this type of business. Yet, this is the case in many "brick and mortar" type businesses as well. Ask any financial institute who does business loans how much time you should allow in a business plan to show a true profit and many will tell you at least 2 to 5 years. Compared to this scenario, with the right implementation on your part, you could quite possibly tip this time scale far in your favor. There are many MLM/NMers who have built to the point of their retirement in this length of time. How fast you build your business is strictly up to you. It is also imperative that you have excellent training and support from your upline and company so be sure to ask questions about this when considering any business opportunity.
Q: Won't you chase your family and friends away with this type of business?
This will depend solely on how you choose to run your business. While you can let your family and friends know about your business and ask them to help by spreading the word and sending you prospects and customers, you DO NOT have to hound them constantly to join your business or buy your products. In many cases, friends and family are your worst critics in the MLM/NM business. They may choose to sit back and watch you to see how it turns out for you before even wanting to talk to you about it. Don't forget, they all know where you are at this point and that you are treading new waters. Many won't want to hop in the boat until they know for sure that the boat will hold water. You can learn to make new contacts outside this realm and your upline and company should be readily available to teach you how to do that.
Q: Don't they take a large investment to get started?
This, also is one of those questions that will depend on the company you choose to partner with. It is very important that you do your research on the affordability of your company. The advice that I try to pass on to others is to try to keep the initial investment under $100 with the monthly autoship of about half that. Also, make sure that the monthly autoship has a resale value of at least the monthly cost to insure that you can recover the cost of your monthly investment. There are many companies that charge far more than this and they certainly may be excellent companies so please do not mistake me to say that anything over these suggestions means they are in any way a scam.
The reasoning behind my suggestion is simply the affordability of the business in the long run. Not only for you as a new member but also to any prospects that may be considering joining your team. There are many more prospects out there that can afford these costs than if it were a $500 initial investment and a $100-200 per month minimum purchase. So, the more affordable it is to the vast majority, the better your chances of success for both you and your team members.
Q: Why would I pay someone else for the privilege of making them money?
When you join an MLM/NM company, you are not accepting a "job" from them. You are starting your own business. If you start a "brick and mortar" type business, you will have a huge initial investment in getting your business started. Considering the cost of real estate, insurance, bonding, utilities, inventory, payroll and many other expenses that you would need up front in those businesses, the cost for starting a home based business is very nominal. It would not be in the best interest of the company to take on members with no charge when it costs the company to send out training materials, set up training calls and conferences (the list goes on) just to find out that the person is not interested in actually working a business. It is also in the best interest of the team member to have this investment because they will be more likely to focus on the serious business at hand if they have a stake in that business. It is very rare, if even impossible, to find someone who will set you up in your own business, furnish everything you need to get started at no charge to you. That is just a common sense deduction.
Q: What if I sign up and my sponsor doesn't give me the proper training that I need?
If you join a company and your sponsor does not offer the training and support that you need, you should contact their sponsor. Repeat this process throughout your upline until you find someone who will train you properly. There are good and bad sponsors in every business so you should consider this before dropping out because of a "less than attentive" sponsor. If you keep going up, you will find the training that you need. It is in the best interest of the upline to take the time necessary to properly train new members so just keep trying.
Q: Is MLM/NM a pyramid scheme?
This would be an astounding NO. The difference in MLM/NM and a pyramid scheme is, for one, pyramids are illegal. This is due to the structure of the pay scale or compensation plan. In a pyramid, the plan is structured so that there is only one leader at the top of the pyramid. On the proceeding levels, you are restricted as to how many people can accomplish this level on each separate level. For example, on the second level, you may only have 5 people that can hold that level at any given time. People in the downline can not reach this level until a member falls off. This is what creates the "pyramid" shape to the plan, thus the name pyramid schemes.
In MLM/NM, the top positions are unlimited and is solely based on member and group performance. In fact, due to this type of structure, it would be possible for this to form an upside down pyramid, meaning that the members enjoy even more benefits as they increase performance in their team. Most people who have associated the MLM/NM with a pyramid scheme simply aren't familiar with how it works and the power of duplication technique.
These are just a few of the questions I have been asked about the MLM/NM business and hopefully, I have been able to address some of the questions many of you may have been wondering about. If you have other questions that I have not addressed, feel free to contact me through the information listed in my biography and I will be happy to assist you in any way that I can.
Bonnie Ramsey
Independent Representative
for Scent Sations, Inc.
http://www.bonnieramsey.com
About The Author
Bonnie resides in a small town in Mississippi, where she is a recruiter in her business, coaching and teaching others to build a home based business. She writes articles, short stories, poetry and publishes a monthly newsletter. You may view more of Bonnie's writings at http://hubpages.com/profile/Bonnie+Ramsey - Email questions to bonnieram1962@yahoo.com
