Multi-Level Marketing: where to begin

Asalam alaykum. I hope you had an awesome day. Today I'm going to tell you about the basics of network marketing. It's one of the lines of businesses that I'm in so here are some tips to ponder on if you are thinking of joining a company or if you are just starting out.

A lot of people are weary about multi-level marketing (mlm) aka network marketing and for good reasons too:

    1. Information provided by some of the marketers to the prospect/public is confusing and

        sometimes untrue.

    2. Some of the companies engage in scams or pyramid schemes

The average person when asked today assumes that all multi-level marketing businesses are bad. But in reality, the mlm model of business is a legitimate, alternative strategy of operations which allows companies to sell their manufactured products through a referral system.

Some of the things to look out for when choosing an mlm company to join:

1. Track Record    

• How long has the company been in business. I recommend @ least 5 years (unless it's a subsidiary or sister company of an already thriving brand)

• Some companies may start off strong when they first launch, but later fade out when the market becomes saturated or consumer perception goes south.

• A good investment is one that is able to prove itself to be financially stable long-term in the marketplace.

• The company has records of a reliable management team

2. Income Disclosure Statement

• While there's no guarantee to the exact amount a distributor can make, it gives the us a rough estimate regarding income generation.

• It is important for anyone interested  to set realistic expectations regarding sales volumes, and to understand that it may take anywhere from 1 to 5 years to build a sustainable income stream that you can live on.

3. Compensation Plan

• Read and understand the company’s compensation plan carefully and be sure to understand all of its conditions and requirements.

• Get all important information in writing.

• Are there refund policies, what are the costs involved (initial capital required, shipment cost, reordering costs etc)

• Avoid any compensation plan that focuses more on recruitment efforts than it does for product sales. As companies that are skewed towards enrolling distributors more than sale of products fall into the  category “pyramid scheme”.

4. Lifestyle and Time Investment

• Before you jump in, strongly consider how this type of business will fit into your current lifestyle.

• How much time must be invested weekly for success in the business venture?

• Do you currently work full-time and how will you work this side business into your daily life? Will this new business require constant travel?

• Ask distributors who are already in the business and find out how much time they invest each week building their business. Consider only those opportunities that fit the amount of time you are reasonably able to invest your time into.

5. Product Quality

• Know the background of the manufactured products of the mlm company.

• Some companies offer products that may be unsafe  or are marketed with questionable claims regarding potential benefits.

• Be sure that products are certified by relevant bodies e.g NAFDAC, ISO etc Legitimate companies will post such information on their corporate website.

• Decide if the products are something you are passionate enough to sell long-term. It is not easy selling products to others that you do not truly believe in yourself.

6. Training

• Most mlm companies do not offer much in the way of sales and marketing business training.

• A few companies have a support system structured by existing distributors to help new comers find their feet in the business

• Be sure to invest in additional training on your own if you want to become successful in the industry long-term and make a substantial income.

• Without this essential knowledge and sales skills, people  completely new to the industry typically fail or quit in the first 3 months of business

There are many multi-level marketing companies out there. I have dealt with a few. In future posts, I will do a summary side by side comparison of some of them currently operating in Nigeria. I believe by knowing what to look for and what to avoid in a multi-level marketing opportunity, you can minimize your exposure to financial losses and begin to have realistic goals and expectations on growing your income.

Until next time, in sha Allah. Take care of you.