We have all been there before. We received “The Call” from a long lost high school buddy or “The Invite” from a co-worker that sounds something like this, “I found a new opportunity that can make you a fortune!” “Really?”, you say. You decide to take a look at it and leave the meeting, pondering, “This opportunity looks pretty good, but does it really work? Do people really make money? Is this a scam? Is network marketing for me?” You’re not alone, many people are unsure about Network Marketing when first introduced to it.
So, what is Network Marketing? Wikipedia defines network marketing or multi-level marketing (MLM), as it is sometimes called, as a way of doing business in which a sales force earns a commission not only for sales of products and services they personally generate, but also for the sales of others they recruit and bring into the business, which creates a downline of distributors and a hierarchy of multiple leveraged levels of compensation.
In short, network marketing is a form of direct selling. It is a legitimate business model chosen by companies to distribute products and services through a low cost word of mouth method, verses spending millions of dollars in advertising to promote the products or services. Individuals like you and I can sign up, or partner with the company, as independent sales representatives. You earn a commission on the products and services that you sell. The unique feature about the network marketing model is that you can build a team of other independent marketing representatives and earn a commission on their production as well. It’s called leverage. You earn a commission on all of the products or services that move through your organization. They, in turn, have the same opportunity to set up the same system. Everyone gets an equal chance to make money and to achieve success.
Networking Marketing is not a get rick quick scam. It is a legitimate and viable business model. According to the Direct Selling Association, 2011 US direct sales were $30 billion dollars. From March 2009 to May 2011, the top seven publically traded direct selling companies averaged a 268% increase in stock price. (WSJ – DSN supplement) . Keep in mind that this increase was doing a recession. Leading industry include health and wellness, beauty, financial services, telecommunications, and an emerging trend, energy. Some are saying that the Network Marketing business model is the answer to the shrinking job market. With the technology boom and globalization, network marketing is expected to continue to expand.
““Mad Money” market guru Jim Cramer recently told his CNBC viewers: “Direct selling has never gotten its due from Wall Street. It’s time we recognize that the direct sales model works, and it works well.” There is little question why financial notables like Cramer, Warren Buffett, Ray Chambers and Suze Orman have touted businesses based on direct selling. (Source: Making Dollars and Sense by Emma Johnson)
Network Marketing requires hard work. Just like with any business, to be successful in network marketing take sweat equity and perseverance. Most companies provide training and support, but you will need to master some core skills, such as sales, marketing, and leadership, in order to achieve supreme success. Network marketing is a personal development program wrapped in a compensation plan. You will transform and grow personally and professionally once engaged in a network marketing opportunity.
Network Marketing is a great income earning opportunity. Yes, you can make money in direct sales. Amway and Avon combined had almost $30 billion in revenue in 2011. Someone is getting paid! Some people sign up with a company to earn an additional $2000 per month, while others may join to reach the pinnacles of success and enjoy time and financial freedom. Other advantages include working from home, low cost to entry, and choosing the people you want to work with. In the end, you’ll get what you are willing to put into it. It is an opportunity. No one is restricting you, but yourself.
Samirian Hill, The MoneyWise Teacher, is the Founder and President of BudgetWise Financial Solutions, LLC, where they teach people to manage money wisely. She is a financial educator, blogger, and soon to be author. Samirian enjoys golfing, reading and cooking. www.budgetwisefinancial.com