Things Should You Know About Multi-Level Marketing:

Knowing Multi-Level Marketing Business Model

      Searching for the highway to financial freedom? Multi-level marketing (MLM) companies want you to trust that a) there is such a thing and b) they are it.

Their pitches can vary from “Achieve financial freedom working just a few hours a week” to “The ideal job for the stay-at-home mom.” And no matter what your interests are, you’re probably to discover an MLM that complements them.

The Multi Level Marketing business provides an excellent opportunity to build a second income, or stable income and job for everyone without the risks, which are usually associated with business, and without spending a huge amount of money.

MLM companies sell their services or products through person-to-person selling. That means you sell directly to other people, maybe from your home or customers, or online.

In the MLM world, everything from holiday club memberships to jewelry to kitschy stickers for your nails can be sold through its network marketing model.

Businesses that involve selling merchandise to family and friends, and recruiting others to do the same, are known as multi-level marketing (MLM) businesses, network marketing, or direct marketing. Some MLM is an illegal pyramid schemes. Before joining an MLM program, here are a few things you need to know.

What Is MLM (Multilevel Marketing)?

The term MLM marketing refers to the methods used by some direct income companies to sell their products and services. Multi-level marketing encourages existing participants to promote and sell their offerings to different men and women and bring new recruits into the business. Distributors are paid a percentage of the sales of their recruits. The new recruits become a network of distributors or downlines, and in turn, are influenced to make money. While many MLM businesses are legal, there are also illegal ones that are run as pyramid schemes.

Is Multi-Level Marketing a Pyramid Scheme?

The idea that has come up frequently before about multi-level marketing is, it is some kind of scam or scheme. One of the main motives for this is, the fact that more than 99% of people who become part of MLM lose money.

Even though the FTC has decided that the MLM business model is a legitimate business, their business practices, and hiring strategies are highly controversial. They have a tendency to take advantage of minorities, people in dire need of finance, and people who are very young.

They have a tendency to make wild profit claims without much real evidence and are usually focused on getting you to buy, into a "mindset" mentality.

Now, that's no longer to say that all MLM organizations are scams. If you've ever had any concept about becoming a member of an MLM agency or organization, it's very important that you become familiar with the compensation structure, the range of fees, and all the downsides associated with joining.

Can You Truly Earn Money from Multi-Level Marketing?

Under the commercial enterprise model, as an MLM distributor, you will make money from two income streams:

- Monetize through revenue from the products/services you sell and promote - this phase usually generates the bulk of your income when you first start out.

- Commission on income earned through crew members/downlines. Over time, as you (the distributor) increase your community through recruiting downlines, this usually exceeds the income earned from selling the distributor's character.

The bigger the downline the distributor has and the merchandise that is being promoted is selling well like hotcakes, the more money it will make.

Is an MLM a Great Method to Make Money?

You may be tempted to become part of an MLM because you want to make a side profit. Or you may view it as a stepping stone to starting your own business. However, to really make money from MLM is quite difficult. Before joining, you should be realistic about how much money you can make, and how much time you will have to spend, to make that money.

It may be useful to have a discussion with someone you know who has been a member of MLM. Or perhaps you should be part of a Facebook help group for former MLM members.

You should ask your MLM recruiter this question as well, but keep in mind that they will benefit if they control and signal you to MLM, so you may not get a completely transparent answer.

Beware of MLMs that make unrealistic claims that you can 'get rich fast

If something looks too imaginary to be true, it probably is.

You should also think about the impact it will have on your relationships with friends and family, especially if they will form a large part of your customer base.

How Do I Join MLM?

Distributors are often recruited by friends, family, or online contacts to learn more about a company or product.

They will of course need to sign up for MLM, study materials to learn about products, and buy inventory.

Multi-level marketing companies have their own terms, and understanding what they mean can be helpful. Here are several phrases you wanna know.

Distributor. This term is sometimes used to describe a seller in MLM. They may also be referred to as “participants” or “contractors,” according to the Federal Trade Commission.

Sponsors. The man or woman who recruits distributors to MLM.

Downlines. In the MLM world, downline sponsors consist of recruits, who sell products to their own network. The recruiter can get a share of their sales. Be wary of companies that place too much emphasis on recruiting new sellers. If MLM wasn't a pyramid scheme, it would pay you based on your sales to retail customers, without having to hire new distributors.

Upline. The individual who hires the salesperson and everyone above the recruiter is sometimes referred to as the "upline." In a multilevel marketing company, each upline will receive a commission based on the seller's profit.

Bottom Line

A lot of people are afraid of network marketing, also known as multi-level marketing (MLM), because of all the myths and misconceptions about this kind of business. Part of the negativity comes from the low MLM success rate. However, multi-level marketing businesses are not destined to fail any more than other businesses. Regardless of which home business you start, success comes from doing the work and perseveringly growing it.