The Network Marketing Industry

The network marketing industry is very popular for people wanting to start their own home business.

Starting a home based business in retirement can be very rewarding if you choose something you enjoy.  What you do will depend on the type of income you expect or need.  There are lots of ways to earn extra money, particularly on the internet.  If you have a computer it opens up a completely new world.

Running a home based business is a lot less riskier than most other businesses because you don't have to find or risk a huge amount of money.  You can run a business from your kitchen table, spare room or anywhere else in the house you have a quiet corner.  You just need the ideas.

Do a google search on "home based business" and you'll find a wealth of information.  However you have to be careful what you choose.  No other business has so many people offering to sell you a system or products which can't fail and will earn you thousands of pounds/dollars overnight.   Be very wary of buying into them.  If they promise to make huge amounts of money very quickly then it's probably a scam.

Building a business takes time and effort even on the internet particularly if you're going to build a blog or a website.  Do it right and it will earn you money.  Do it wrong and it will be one of millions of other blogs or websites on the internet that gets very little traffic which in turn means zilch income.  Take a look at starting a small internet business and how to supplement your income.

There is one home based business however that is very popular and that is the Network Marketing Industry or MLM (multi level marketing) as it's also referred to.

Most people I know have tried it at some time in their life, but it does come with a warning.  The network marketing industry is not for the faint hearted.  A great number of people fail miserably (about 90%) and even end up in debt trying to get it off the ground. 

However that said, the 10% that make a success of it seem to earn a great deal of money and enjoy a great lifestyle.  I can only tell you about my own experience and then you will have to judge for yourself whether it's the business for you.
 


My Experience of the  Network Marketing Industry

I've been in the  Network Marketing Industry for 10 years and I'm still waiting to make a profit. Although I love my products in the health and beauty industry and I and my family use them every day  I've stopped trying to build the business. I reckon if I haven't made it work in 10 years nothing much is going to change.

I was finding it increasingly harder to get people interested in the business even though in theory with unemployment the way it is one would think they would be begging to join. I've also found it harder to sell the products because they are pricey and these days with the economic downturn people are looking for cheaper products than I'm selling.  Even though mine are top quality and usually do what they say they do.

I find people are particularly wary and sceptical about the business model which is mainly because they don't understand it.

You tend to come up against people who accuse you of pyramid selling.  Let's define what the difference is.

Pyramid  selling is when you exchange a sum of money in return for the promise of receiving a much bigger sum of money back in the not too distant future.  There are no products involved it's all about the money.  Pyramid selling is also illegal.  So if anyone offers you something like this walk away quickly and don't look back.


The network marketing industry is direct selling.  In effect the Producer is cutting out the middle man.  The Company sells direct to people who want to buy through distributors who then receive commission on what they sell.

There a number of very well known network marketing companies which you have probably heard of and even bought products from at some time during your lifetime.  These are Avon, Betterware, Forever Living (which is the one I belong to) and Herbal Life to name but a few.  Good companies have been around for years.

Who remembers the Tupperware parties?  I still use the tupperware I bought 30 years ago.  Great value for money, I believe it's experiencing a comeback at the moment.

There have been a number of companies in the network marketing industry that have given the industry a bad name.  Anyone remember "Amway"?  A lot of people got caught up in that and got their fingers burnt when it went under.   That's one of the problems with the network marketing industry.  You could build a successful team and then the business goes under and you've nothing left.


How the Network Marketing Industry works.

You can start a network marketing business for £100-£200 which is approximately what you will pay for a starter pack which usually consists of a selection of the top products together with a selection of product literature, price lists, order forms and product and company information.  You then start selling your products to friends and neighbours and make commission on your sales.

However the way you build a successful  business in the network marketing industry is not just selling your products but selling the business opportunity itself.  You are encouraged to recruit as many people as you can to become distributors and you move up the ladder just like any traditional business to become firstly a supervisor and then an Assistant Manager until you are Managing your own team.

Your distributors in turn sign up their own distributors thus building you multi-levels of distributors. You then receive a percentage of their sales as well as well as  the profit on your own sales.  It all sounds so easy.  "Everyone can do it" so they say.  However the business model is flawed.  The biggest downside is your reliance on other people.

I've recruited many people into the network marketing industry only to find that they give up within six months because they don't sell as much as they hoped and they find it difficult to recruit.

Not everyone has the motivation, (they call it "your why"), the right personality or the money that is required for all the training and the  products you have to buy each month, the literature you're expected to buy which includes free samples that you're encouraged to give away! 


Getting Started in the Network Marketing Industry.

If you decide to start a home based business in the network marketing industry choose your company with care.

Only go with a company that Is a member of the Direct Selling Association

Has recognition with the Investors in People award which demonstrates that they provide a good training programme.

Choose a company that's been around for a few years and check out their sales growth.  Are they increasing year on year or decreasing.

Choose products that you are going to enjoy using yourself and will be happy to recommend.  Go to all the training sessions and business presentation meetings. 

Selling the Products:

There are lots of ways to sell your products.

  • Invite your friends and neighbours to home parties
  • Sell your products at school and church fetes
  • Farmers markets
  • WI meetings or any other Groups you can think of.

You are not allowed to sell in shops or to take a regular market stall but companies may vary on these rules.   

Building a  Business in the Network Marketing Industry


It's all about recruitment and to recruit you have to have people you can talk to about the business.

You are encouraged to build a list of potential prospects.  When you have your list you try to sell your prospects the business opportunity.

Building the List

There is a great deal of emphasis on your list.   The success of your business is likely to hang on how big a list you have.

You are told to  make a warm list of everyone you've ever known since school.  This is where you risk alienating all of your friends and family and also where you start experiencing rejection.

The 3ft rule:  trying to steer a conversation to "would you be interested in my business opportunity" with anyone that comes within 3ft of you, when you're out shopping or socializing.  If you don't do this several times a day you are failing to prospect.

You are encouraged to pay for flyers and cards to push through doors which takes hours with very little return.

Cold calling which leaves you with a  huge telephone bill with very little return.

All of the training that tells you "if you're not stepping out of your comfort zone then you're not developing".

I can tell you as a Training & Development Manager in a previous life I have my own thoughts on that one.

I do agree to a certain extent with "feel the fear but do it anyway"  philosphy.  It can give you a tremendous buzz to do something you've been a little afraid of and master it, but if something is continually making you feel uncomfortable for very little return you will eventually begin to feel de-motivated and lose your focus.

They tell you it’s a Numbers Game

You're encouraged to talk to 5 people a day about your business. Out of 12 calls you may get 6 to show the business to. Out of those, 3 may come to your business presentation. Out of those, 1 if you're lucky will join your business and that's the optimistic view.

They say that you need to talk to 100 people to get 1 into your business.

You'll need to be good at accepting rejection.  You get a lot of that.  You'll probably start to lose your motivation and feel pretty low in confidence because you're constantly failing.

No wonder 90% of distributors give up.  Surely there has to be a better way?

Well there could be! The internet has created a new model of building a network marketing business.


The New Model in the network marketing industry.

Build your list on the internet.

The script is something like this: 

"Wouldn't you rather switch on your computer in the morning to find e-mails from people who have found your links on the internet and want more information. They will be asking you to contact them. WOW!

They'll be  actually waiting for you to call them. By the time they get to you they are genuine qualified leads all for free. When you call them they're waiting to hear from you. No more dreading to pick up the phone."

Believe me building a list on the internet is just as hard.

Firstly it's time consuming and secondly can be expensive if you don't find the right tools.  I was lucky to find a good system that wasn't too expensive and had excellent training. Yes I learnt a huge amount about the internet and how to build my list.  However I didn't see my network marketing business benefit from it. 

Visit any of the social network platforms i.e.  Facebook, Twitter, Linkedin Google+, Pinterest or any other and you will find hundreds of Network Marketers trying to sell you a stystem that's guaranteed to build your list and turn you into a multi-millionaire by using the internet to build your list.

And many of them have succeeded in earning large sums of money, but actually they've made their money by selling their "system" their "How to DVD's " their "books" etc. not so much from actually selling their Company's products or business opportunity.

Yes I'm sorry to say  I'm one of the 90% of distributors who tried the network marketing industry and failed.

That said don't let my experience put you off if you want to have a go.  You may just be one of the 10% that make it work and become very successful.

I know it can work that's why I tried for so long. 

There are top distributors in my own company that have been able to build huge teams and earn a lot of money.  They made it their life and they reap the rewards of all expenses paid trips abroad, profit shares and many other bonuses.

I also know a huge amount of very intelligent and successful business people that have failed to make the network marketing industry business model work for them.

From my own point of view I have the best of both worlds.  What I learnt about the internet gave me the confidence to build this website so I now have a home business and I'm reaping the rewards without having to  rely on other people to make it work.

I continue to sell the products to family and friends and I use the products myself which I believe in so I haven't officially quit, not yet anyhow.

The problem with the network marketing industry is they try and sell it on the type of business that anyone can do.  This is where the business model is flawed. 

We're all different and what seems hard work to one person will seem like a wonderful opportunity to another.  There are some that think it's the business model of the future, and others who end up bitterly disappointed and broke.

If you decide to give the Network Marketing Industry a go remember that network marketing companies can and do go out of business just the same as any other business and if they do that means all of your hard work of building a team can vanish overnight along with your profits.  Unless of course you have "A List" which means you can sell them the next network marketing opportunity you decide to join!

Return from Network Marketing Industry to Supplemental Income

How to Start a Small Internet Business.

Baby Boomers Handbook: Entrepreneurial Bridges to Retirement

How to Build a Website

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