What is MLM and network marketing?

Since the article in Issue 20 I’ve been inundated by people who need advice. You want to know; is network marketing legitimate and if so which companies are the best, what’s the difference between them and how can you pick one that will suit you, your lifestyle AND earn you good money? As you know I have a business to run, just like most of you, so sadly it’s not been possible to answer you all individually. But we can cover a lot of the basic information through this column. Network marketing is a legitimate industry, well regulated and, in the main, ethical.

However like every other industry on the planet it has had its’ fair share of cowboys and cons. It really should not be confused with nebulous money schemes or impossible sounding investments. Some years ago the topic of the central speech at the Annual Conference of the Small Business Bureau was Network Marketing (NWM). The speaker discussed many reasons why small business owners should consider NWM either as a second profit centre or as a way out of the traps they often found themselves in.
My top 7 points would be ...
1: A tiny initial investment and therefore minimal risk. Most companies charge Ł15 - Ł75 to get started, with an optional Ł100 or so for a small amount of demonstration or initial stock.
2: Tiny overheads. You don’t need premises or staff and the company does 95% of your paperwork for you. So other than a phone, maybe a fax and some postage you have virtually no start-up costs.
3: Enormous time flexibility. With no boss, or often even worse business partners, you can schedule your hours to suit yourself, your distributors and your customers.
4: With the better companies you can expand your business internationally with no import/export hassles and no need for offices in those countries. The company does all the paperwork, meets all the local requirements and you simply benefit from increased turnover. (I built a business in ten countries without ever leaving the UK except on holiday)
5: You continue to benefit from the advantages of self-employment without suffering the isolation that so many small businesses do. You will receive advice and support from your ‘upline’. Your upline are business advisors whose job it is to help you succeed, particularly in your first year.
6: Your income is immediate with the better companies and with most it can become passive, where the income rolls in without you working, after certain qualifications have been met.
7: Your business is a marketable asset. It can be sold just like any other business can. However only the business is sold, there are no premises attached to it. It can usually be left in your will, although some companies don’t permit this.
Now, if all this sounds too good to be true. Well you could be right. ALL these things are certainly not possible with EVERY company. The companies do vary an enormous amount. As an example of just how much, next month we’ll be looking at payment plans. I’ll cover how in your first month, for doing exactly the same thing, you can receive nothing (Ł0) from one company and over Ł300 from another -- don’t miss it!

This article was originally published under the title “Will a Net-Work for you?” in the UK in Business & Premises magazine in April 1997. ©1997 ESG

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