Wikipedia defines MLM as “Multi-level marketing (MLM) is a marketing strategy in which the sales force is compensated not only for sales they personally generate, but also for the sales of others they recruit, creating a downline of distributors and a hierarchy of multiple levels of compensation. Other terms for MLM include network marketing, direct selling, and referral marketing.”
It is now 65 years since the method of distribution began and it is still often misunderstood and treated with suspicion. You can read about the origins of MLM in my post Network Marketing Today.
What is MLM? Some people still think MLM is a pyramid scheme and I have been asked “is it one of those things?” It is not a pyramid scheme – they are illegal. You can read how this perception came about in Network Marketing Today – 2
MLM or Network Marketing is a very fair method of distribution. It is a method of distributing products and services directly to the consumer. Rather than going through shops and retail outlets it uses a marketing network of self-employed people to find customers.
These self employed people are called a range of things including distributors, associates, consultants, independent business owners, members and representatives.
Apart from the Pyramid Scheme myth there are others that continue to surround the industry. These include:
Myth – only people at the top make money. Fact – this is untrue. Modern compensation plans reward and compensate effort and results.
Myth – those things don’t work. Fact – there are many people around the globe earning a very good living by working in the MLM industry. Paul Zane Pilzer, author and economist predicts 10 million new millionaires in the next decade and says the majority will come from the MLM industry.
Myth – they are get rich quick schemes. Fact – they take time to build, consistent effort and hard work. The hard work includes working on yourself.
Myth – you have to sell to family and friends. Fact– you can choose to talk to your family and friends, it is up to you. The internet has changed the way many people are building their business.
While the industry continues to have its critics some of the richest men in the world are advocating, starting or purchasing Network Marketing Companies. They’re the World’s Business Experts, Visionaries & Trendsetters and include Robert Kiyosaki, Donald Trump, Richard Branson and Warren Buffet.
Robert Kiyosaki ~ Business of the 21st Century answers the question of What is MLM by saying ;
“By it’s very nature and design, network marketing is a strikingly fair, democratic and socially responsible system of generating wealth.
These may be economic hard times for the majority, but for the many entrepreneurs, these are times teeming with economic potential.”
“Not only is now the time to have your own business, but there has never been a better time than right now.”….
I share with you some of my reasons for choosing MLM in this video.
Some of the features I like about MLM include:
- It is a growing exciting industry
- Minimal Start-up capital
- Uses your sweat equity
- No asset risk (don’t have to borrow against your house to get started)
- Virtually risk-free
- Established systems and training
- No employees, and all the expenses that go with that
- You support and train independent business developers
- Low overheads
- No premises – work from home
- No stock
- No debtors
- Flexibility in hours and lifestyle
- And one of my very favorites – I can build a global business on the internet
- Residual Income