Multi-Level Marketing
Multi-Level Marketing
Opportunities -
UKDropshop.com
The
concept of
Multi-Level
Marketing, also known as MLM,
has been around for many, many years.
There has always
been confusion over how MLM actually works in
the business arena, and this is mainly due to a
lot of companies using the wrong principles to
how it was intended to be used. This has created
a very negative experience in the eyes of many.
To give you an
example of familiar companies who use MLM, which
are now household names (to help you
understand), you need
look no further than Kleeneze and Betterware.
Now, these are an examples of how MLM can, and
does work - and very well.
The idea behind
the concept, in it's basic format, is to
generate as many people (resellers) as you
possibly can, reselling the company's products;
and receiving a commission from each and every
sale these resellers make. The more sales your
'team' make, the more money you earn as a
commission.
Example:
You view the
business package, and reseller plan from an MLM
company. The company will have an array of
products (or services) which are intended to be
resold. Most
MLM companies
will expect you to sell the products yourself,
and then for you to 'recruit' a 'downline' (an
army of resellers) to sell the products for you.
You then receive a 'cut' or percentage of your
reseller's profits.
The advantage to the
company, is that of course, they end up with
many, many resellers promoting their products.
The advantage to you, is that if you can
create a large enough 'downline' (army of
resellers), then you will make a certain amount
of profit from their efforts.
This may sound easy.
But, like any
business
opportunity, any success
will highly depend on the amount of resellers
you can 'entice' into the business opportunity,
who in turn will also be expected to recruit
resellers of their own - who you also make
profits from.
The difficulty, and
where this system breaks down (from the
resellers point of view -not the
company's), is that by having to recruit other
resellers, you are actually having to find, and
build a team of people who also need to have a
vested interest in creating a business - not
easy!
When explaining the
concept of MLM, it will always sound enticing.
Here are the products; sell a few; get a few
other people to sell a few, and you will be
making X amount per month. Easy - not so.
The biggest problem
with MLM, is that although you may
use a large amount of energy, and resources
creating your downline, the majority of such a
downline may not be as enthusiastic as you.
Therefore, you are relying on the fact that you
will ALWAYS (nearly always, unless selling £5
notes, for 20 pence) have to keep on recruiting,
because just as quickly as you can recruit, the
members of your downline will drop out, because
they themselves, do not have the ability to
recruit their own resellers - hence they will
not make money, and drop out of the system.
What happens then,
is that even if you are making a certain amount
of revenue, if your downline are quitting, then
unless you are a dynamo in recruiting,
your income will stagnate, and eventually fall
to zero - if all your downline suddenly
disappeared overnight.
Another main problem
with MLM, in our experience, is that you are
always relying on other people's business
ambitions for your own success. And, if you have
been in business any length of time, you will
already know, that most people only 'try' to
make money, rather than going after the revenue
they seek, with a white-hot burning desire.
The conclusion,
is that unless you are highly skilled in
recruiting people to resell for you (and very
few people are) then there are definitely more
viable business opportunities for you to become
involved in.
But is MLM a scam?
This all depends on
how the company using MLM portray the
opportunity. For example, in the early nineties
there were very many companies who started a
'pyramid scheme', which gets confused with the
concept of MLM.
Pyramid schemes
nearly always involve money changing hands
between members, where there is not an actual
end product. For example, one particular company
in the nineties offered such a scheme, whereby
their members had to find other resellers, to
find other resellers, to find other resellers,
etc. There was no product. If
you found a reseller, the company simply paid
you a certain amount of money; say £125. To join
the scheme, it cost £195.
Therefore, what you
were actually doing, was trading in money, and
from the company's point of view, they relied up
on all resellers, finding other resellers to pay
the £195 joining fee - so they could pay other
resellers.
The Department of
Trade and Industry (DTI) closed down hundreds of
these companies - and rightly so, because the
main problem was, that ALL resellers were
relying on another reseller joining up to pay
money, for no end product. That was the problem,
there was NO end product - hence classed
as a pyramid scheme.
Like we say, MLM,
providing you research and start with the right
company, CAN work. Although the world has moved
on since those early MLM days, and there are now many,
much easier ways to start a business and create
a second, or even full-time income, being your
own boss.
The following
link will provide some very good such
opportunities. Please click the following
link for details.
Home Business Opportunities.
Is Multi-Level Marketing
For You? -
UKDropshop.com
