So you’ve decided to start a home based business, but you are not sure if the network marketing company you want to join is right for you. Everything you have heard about them is “TOPS”. But you’re getting all of your information from the company’s independent associates and the up-line. Every time you get on a conference call, the information they provide sounds great. The presenter say everyone is making tons of money, going on trips all the time, driving expensive cars, and living in mansions. Who wouldn’t want to be part of all that success? They talk about the company, the product, and the opportunity. And then, it’s decision time. All of the excitement gets your adrenalin pumping and you’re ready to jump in. But you decide to be cautious, and do a little research on your own. After you arrive home, and its just you and the mirror, you have second thoughts. “Can I really do this business?”, you ask yourself. “What happens if I can’t get anyone to join?” “Is this one of the legitimate home based business opportunities? Or is this another MLM company that feeds off of people like me?” All of sudden, you are not confident as as you were on the opportunity call. Don’t feel bad because you’re not alone.
Tens of thousands of North Americans decide to start a home based business every year. And many of them opt for a network marketing opportunity. But the facts remain the same, whether it is a traditional business venture, or an MLM opportunity, most new home based businesses aren’t successful. Why? Its a combination of poor or no research, bad business planning, and unrealistic income expectations.
When a person enters the network marketing arena, it usually goes something like this. A friend invites them to an opportunity meeting or to listen in on a opportunity call. When they do so, They usually get caught up in all the hype, and before they can say “What am I getting myself into?”, they have brought into a business, and joined a company they really know nothing about. It happens all to frequently; from hotel conference rooms to private homes, to conference calls, thousands of people join business opportunities every week.
Most of these new business owners never get their business off the ground. And if they do, most never turn a profit. Why? The main reason is that most people aren’t ready to start their own business. They weren’t looking to start a new business in the first place; usually someone else convinced them to do so.
But there are some people who are ready, and are looking to get started with a business opportunity. And you may be one of them. If so, you probably already have the passion and the drive to make it happen.You probably have the investment money to get it started. And you probably have the money to sustain yourself and your family while you build your business. You are ready. You have researched a number of MLM and network marketing companies that peak your business interest. And now its time to put them to the test. Here are ten questions you must ask before going into business with a MLM or network marketing company:
1. Is the company solid? Financially, and Ethically.
A. How long have they been in business and what is their financial situation? There are hundreds, if not thousands of new business opportunities that have popped up in the last ten years. It is a good rule of thumb that if a business has been around for 5 years, they should be making a profit.
B. Are there a lot of complaints with the BBB, or your State Attorney General’s office? If a company has more than a few complaints, that should trigger a yellow (caution) flag.
2. Is there a real need in the marketplace for their service or products?
A. What percentage of people need the product or service? If your product or service is only needed by a small percentage of people, then you will have a difficult time marketing it.
B. What percentage of people want the product or service? If everyone wants it, or could use it, but very few know its available, then you might have a gold mine. Still, you will have to get the word out; and that’s where the company will be counting on you. There must be a balance between ‘needs’ and ‘wants’, or supply and demand, for a product to be successful in the marketplace.
3. Does their product or service support itself without offering the business opportunity?
A. In other words, is the product affordable or is it overpriced? Many companies offer inflated prices on their products or services, making it difficult to sell. Often times this leads the associates selling the business opportunity, instead of offering the products. Beware of companies that offer extremely low commissions when you make a sale on the product side, but give huge bonuses when you recruit someone into the business.
B. Is the product or service exclusive to network marketing or can you get it anywhere? If a potential customer can get your product just about anywhere, it will be that much harder for you to make a profit and you will need to be able to convince your potential customer that what you have is better than the rest.
4. Do they have a real internet presence?
A. Can your prospects purchase the product from you online? This is a must in 21st century network marketing. Building a client base will still require human interaction, but when your customer is ready f to make another purchase, this is the easiest, and safest, way to provide them with immediate access to your product(s).
B. Is the company new to the internet? Do they have a proven track record? This is important to your success when it comes time to make the sale, or recruit an associate. A good company will always have an IT department with web developers that keep the content current.
5. Can you recruit online?
A. Can you manage your down-line online? It is vital to your business to be able to track your sales to the penny. Many companies only provide BPV, or product volume, etc. But you want to have daily access to gauge your sales volume in dollars and cents. This also pertains to your down-line. You should have the potential to send broadcast messages and thing of this sort. It will be a very important for communication with your organization.
6. After the initial investment, how much money can you expect to invest before you see a check? One of the advantages in going into business with a MLM or network marketing company is supposed to be the low initial investment. Combined with the potential for quick income, these to items are essential in building a successful business. Its called ROI (Return on Investment). The faster you receive it, the greater potential you have of growing you business. The bottom line is if you don’t see yourself drawing a commission within 90 days of starting you business, then another caution flag should go up.
7. How fast and how often do they pay commissions?
A. Are checks distributed once a month, once a week, or once a day? Many years ago, MLM companies only cut checks at the end of the month. Today, that’s hardly acceptable. Today, money moves a lot quicker then it use to. And it has to in network marketing. Getting your commissions to you as quickly as possible is vital so that you will have money to sustain your business.
B. Are checks direct deposited? Point blank; this is a must.
8. Is there a real potential for override income?
A. If you are at least one level above your recruit, are you entitled to override income? Some companies expect you and your organization to produce a certain amount of volume, or meet certain monthly quotas, before you can receive override income from your downline. Generally, a good rule is to find a company that offers over-rides; if you recruit someone and they are at least one level below you, you should be entitled to overrides from them and their organization.
9. Is there potential for real residual income?
A. If your customer continues to buy the product or service, do you get monthly commissions? Residual income means you get paid, as long as the customer you introduced to the company, continues to purchase the service or products. This is a no-brainer and real way to build wealth in network marketing.
10. Is there real training?
A. When you join a MLM company, more than likely, they will encourage you to make your list by going after your warm market. Your warm market is your relatives, friends, neighbors, and co-workers. They will encourage you to have a home meeting, bring your guests to the weekly hotel meeting, or invite them on a conference call. That is all good for generating a quick return on your investment while you are learning the business. But what happens if and when the list drys up? What happens if the person who recruited you drops out of the business? Are your up-line folks accessible? Are there company sponsored training and events?
B. Is there training that teaches you how to really tap into 21st century internet marketing? Today the internet is the engine that drives network marketing. Billions of dollars are earned in network marketing utilizing the world wide web. When you decide on your business, make sure that your recruiter has a plan that will position you so that you will be noticed on-line. Make sure that it includes training that will teach you how to target your market and drive traffic to your website. This is the single most important lesson that you will have to learn to ensure you are successful with your new business.
So here you have it. The ten questions that must be asked to determine if the company your are interested in offers a legitimate home based business opportunity. You want a company that will assist you in laying the foundation for real success. If that company provides good, concrete answers to these questions, then it’s a good bet that going into business with them will be beneficial. Researching to find the right company and network marketing business to join could very well be the most rewarding time you will invest in your future.
Gerard Cassagnol is a professional writer and network marketer. He has written several articles on small and home-based business start-ups, as well as legal and identity theft issues of the day. He has operated many successful small businesses, both traditional and network marketing/MLM, full time and part time, over the past 25 years. He is also an advocate for affordable legal protection and coverage in America and Canada.