The whole truth about network marketing. How does an online business work? Types of business plans in network marketing. Advertisements in the media

Why did I choose a cautionary title for this article? Because, unfortunately, lately I have come across deplorable stories of people working in network companies and having the same deplorable results of this very “work”.

Network marketing (or multilevel marketing; English multilevel marketing, MLM) is a concept for the sale of goods and services based on the creation of a network of independent distributors (sales agents), each of which, in addition to selling products, also has the right to attract partners who have similar rights . At the same time, the income of each network participant consists of commissions for the sale of products and additional rewards (bonuses), depending on the volume of sales made by the sales agents they attract.
Network marketing originated in the 1940s. The dawn of the network company industry occurred in the 80s and 90s. One of the founders of the industry was a well-known company American Way Corporation (Amway).

Myth No. 1. Network marketing is my business.

Do you seriously think that this business is yours? What if you think about it? Have you thought about it? No! Network marketing in 99.999% of cases is not your business. Network marketing is a business only for those (very smart and enterprising) people who founded it. Dot. This is the business of those people who speak to you at company seminars once a year and make motivating and “grand” speeches from the stage.

What's the problem here? But the problem is that those newcomers who come to the network company are “explained” from the very beginning that he will be engaged in BUSINESS. Yes, that's true. But not all newcomers clearly understand whose business they will be involved in. Understand that a business is yours only if you have the authority to make key decisions about how it is run. Can you make such decisions in “your” network company? Can you change the price of products? Can you change the range and suppliers? No. You only RESELL the products yourself or through attracted new sales agents. You are forced to obey and comply with all the conditions and rules of doing business that its founders dictate to you. Even if you have registered a business or company and are engaged in selling the products of “your” network company, you have very limited freedom of action, unlike a full-fledged entrepreneur.

Understand that if you work for a network company, then this is NOT your business. In this case, your activity can only be called an alternative to working “for someone else” and self-employment, but not a full-fledged business, in true economic sense this word.

Myth No. 2. There is a lot of money in network marketing and you can get rich quickly.

Of course, the most best option- this is, of course, to try and look at the result. But, as many years of practice have shown, there is NO big money in network marketing. Sometimes there is no money there at all, let alone much. How can this be, since network companies make billions in profits? Yes, they do. The founders and those who head these companies and are personally close to the management receive it. Ordinary mortal distributors are content with small checks that barely allow them to make ends meet. You may object that you can become a leader! You're right. You can also fly into space. The whole question is who “will not vomit” on the way to this space, who will not lose consciousness and how long to fly to this “space”. And in general, do you need this space?

All that an employee of a network company does is search for those who would sell more and those who would sell more and who would be looking for the same thing.

People involved in network marketing (may they forgive me) are just intermediary sellers. Just INTERMEDIARIES. Of course, intermediaries can sometimes earn good money, but the owner receives the main profit.

There is no big money for an ordinary distributor in network marketing, it simply isn’t there. All the golden mountains that your “mentors” and leaders draw for you are a farce and clean water motivation with profanity. Getting rich in network marketing is very difficult. I won’t say that no one has made a fortune selling detergents, toothpastes or super horseradish cutters, but the pictures they paint for you are radically and sharply different from the harsh reality.

Think of Network Marketing as an Alternative regular work(and then carefully), as an additional source of income, but not as an easy and short path to wealth. I repeat, of course, there are people who, as distributors, became leaders and made a fortune for themselves. But these are tough, unceremonious people with pronounced leadership qualities, these are people who have gone through fire, water and copper pipes in this business, devoting a good part of their lives to it. There are one such “lucky” distributor in a million. Want to try your luck? That's your business.

Myth No. 3. My mentor is my friend, he will help me with everything, teach me everything and explain everything.

The hell with it! Well, whoever, your mentor is definitely not your friend. Friends don’t bother each other month after month by constantly reminding them that they need to qualify this month and buy three and a half more super horseradish cutters for future use, they say. Friends do not benefit materially from friends, at least the good and true ones.

Your mentor is the one who is most interested in your success, eloquent people told you in seminars and meetings, he will teach and guide you. So it is so, but what is the problem in this situation? But the problem is that the wards begin, under the yoke of their “beloved” mentor (who, by the way, should have been sent into the dense forest long ago) to commit actions that contradict the actions of a person in a bright mind and good health. Such wards begin to take out loans, get into permanent and hopeless debts, and begin to make deliberate decisions that are not their own and not their own. This often leads to very unpleasant consequences that the mentees themselves have to sort out, without the “help” of mentors and leaders.

In general, in our lives we are constantly influenced by other people, whether we want it or not, and very often there is no awareness in our actions and decisions. In network marketing, distributors who are dependent on other people’s opinions, listening to the mentor’s motivation and looking at his painted pictures of golden mountains, lead their lives downhill (in a very bad case) without knowing it. And it's sad.

Your mentor may be a good person and he may indeed be your friend, but this is in very rare exceptions and only if he is not very interested in your results in the network company, respectively, as well as his own. Understand that a boss will never have a true and sincere friendship with his subordinates - this is nonsense and is contrary to business.

Mentors, seminars, educational and entertaining group events in network marketing - their actions are mostly aimed at brainwashing, retaining distributors in the company and increasing the company's profits. They didn’t care about you, your life and your problems. Remember this. The first leaders of the company will never share with you the secret knowledge they have, since they are not interested in your growth to their level. They give you exactly the information and knowledge that you need to increase sales, nothing more. They are not interested in your true growth and reaching your potential.

Let's summarize.

Of course, there are quite a few in network marketing positive points. Working in network companies, a person learns a lot, goes through an excellent school of sales techniques and learns a bunch of interesting things. In the process of work, he can radically (possibly in better side) change your lifestyle, can start traveling if you haven’t traveled before, communicate with interesting and successful people, can discover a new side of yourself, and so on. There are definitely advantages. But you don’t need to rely on MLM companies as if this is the only occupation worthy of you, that it is a gold mine and some kind of unexplored Klondike.

I repeat, you can consider working in a network company as a means and starting point for unlocking your potential, as a sales school, a school of communication and interaction with people. But those myths that you read above should not be forgotten. As one says good man and coach Ildar Zinurov: “There is no happiness in the network business.”

Yes, in network marketing you can earn money for a living, you can study, you can travel while working as a distributor, but the happiness that you are told about at the first and subsequent presentations is definitely not there.

We often do wishful thinking. You need to look at the results and draw conclusions. You need to use your precious tool as thinking. Use it! Think with your own head. Trust facts and results, not the words and pictures of your mentors and leaders. If nothing has changed for you for several (or even decades) years, then it is not prudent to believe that by continuing to do the same thing (for example, working hard in a network company), something will change for you and you will start shoveling money. You won't start.

P.S. Who am I to talk about working in network companies like this?

I have a direct connection to working in network companies. I had the good fortune to work as a distributor Chinese goods, and not really simple version- wandering around organizations with a bag at the ready. I was engaged in cold sales. I consider this the most aggressive and difficult form of network marketing. I had a sales system, like in all similar companies, I had a mentor (and more than one), there was a lot of “washing” of my then still virgin brain, and so on. I went through all this and realized (fortunately quite early on) that this is NOT my business, that mentors are NOT friends, and that everything is NOT as sweet as they tell me. Plus, I have many friends and close people who are involved in network marketing in one way or another (some for more than 10 years). So I more than know what I'm talking about.

The first steps in any activity are always the most difficult. The MLM system is no exception. On the contrary, it can be considered a vivid illustration of how important it is to pay maximum attention to the beginning new job. Many people don't understand this. Or maybe it’s not that, but incorrect information. For some reason, most beginners think that all they have to do in an online business is register - and banknotes will start appearing out of thin air. Such a belief certainly leads to collapse. Having realized that in this industry, like in any other, you need to make an effort, 90% of beginners fade away. Therefore, if you have made the decision: “I’m looking for MLM,” first realize that this path is not easy, but its advantage is that the return here is maximum.

If your sponsor claims that you won't have to do anything, it's not true, you can be sure. There will be a lot of work, especially in the first year in network marketing. You need to undergo training, master various techniques, learn how to conduct meetings and presentations, learn everything about the company and its products. You also need to make own plan, which you will follow, because the organization and step-by-step work process is important here more than anywhere else. You need a list of contacts of possible clients. It requires a separate good notebook that can serve you for a long time. A separate list needs to be created for potential partners. Perhaps somewhere you will see an advertisement “Looking for MLM”, or one of the clients will seem like a good candidate to you - all this will need to be recorded, because the day will come when you want to move on, and for this you will need to create your own network of distributors .

All this work will need to be done shortly after registration, so you can imagine that you won’t have to idle. Remember, once you decide: “I’m looking for MLM,” don’t expect easy profits. It only happens to seasoned networkers.

The essence of MLM business

To succeed in any type of business, you must have a good understanding of its essence. Only in this case will you be able to understand its mechanisms, master important techniques and be able to grasp important trends. Network marketing is no exception in this regard. Let's try to figure out what the essence of MLM business is, what distinguishes it from other types of activities, what do you need to know about it?

Network marketing is a special type of trading. It consists in building a wide network of consumers of specific products. Each distributor gets the opportunity to purchase goods at a special price, and invites partners to do the same. Ultimately, the network of distributors expands and the company's turnover grows.

The essence of the MLM business is that between the production of products and their delivery to the end consumer there is only one person - a company representative, an official distributor. This person performs all the functions that are at points retail usually assigned to different people. Think about how much money is spent on advertising and how many people the average manufacturer or store needs for the product to find its buyer. These are managers, storekeepers, salespeople, programmers, and cashiers - a huge staff, not counting loaders, advertising agents, and technical staff. However, you should not immediately get scared and think that the work of a distributor is hard, backbreaking work for yourself and for others. In fact, the process of network trading has been established and worked out for years, so it is quite easy. Companies always provide all materials that are necessary for work to their employees. Printed materials, video materials, presentation equipment - everything that is required is received by the distributor. His task is to introduce the company, outline the concept, and get people interested in the product. You may need to show sample samples, or talk about personal experience- this is not the topic of our article, and everyone’s methods are different. There is only one goal - to accept the order and deliver it to the client at a place and time convenient for him. Well, of course, take your share of the profits. The essence of MLM business is not difficult to understand. On the contrary, everything ingenious is simple.

MLM system

The company's MLM system is based on a document that defines all its financial matters. This fundamental document is called a marketing plan. It includes all expenses and all income. It describes who will earn how much and for what. Well, since MLM is, first of all, a business and the numbers in it are of primary importance, the marketing plan can be considered the heart and soul of the network company. No MLM system could work without this document. This is what new people who come to network marketing look at first, because it reflects how much they will earn for their efforts.

The MLM system provides for continuous training and improvement of your skills. Every self-respecting company provides this opportunity to its distributors. The range of products is constantly updated, new sales techniques appear, and all this requires new knowledge and skills from employees of network companies. MLM is a cutting-edge business, so everyone involved in it must keep up with the times.

List of MLM companies

The list of MLM companies today is very different from what it was 10 years ago. Then it was several times shorter, and was represented mostly by cosmetic companies. Today, it is simply impossible to list all the network companies, and the variety of products offered is incredibly large. Let's look at at least a shortened list of MLM companies:

Amway is one of the world leaders, a company whose product range includes household chemicals for the home, nutritional supplements, cosmetics and perfumes.

AquaSource is a company that originated in England. Produces homeopathic remedies.

Avon is one of the most famous companies for women.

CielParfum is a domestic company that produces perfume products.

Coral Club International is a very well-known company that produces vitamins and dietary supplements.

Dr. Nona is a brand of cosmetics, perfumes, dietary supplements, founded in Israel.

Edelstar is the brainchild of V. Dovgan, a domestic brand of cosmetics. Currently absorbed by Faberlic.

Fleur de Sante is a cosmetics brand, an international giant, operating since the 80s of the last century.

Herbalife is a famous brand of dietary supplements and weight correction products that became famous in the 90s.

Infinum - today also absorbed by Faberlic, produces cosmetics and nutritional supplements.

Mary Kay is one of the oldest network companies producing cosmetics and perfumes.

Neways is an international company specializing in the production of cosmetics for appearance correction.

Oriflame is one of the most famous cosmetic brands.

Provea Collection is a company that distributes exclusive lingerie.

Tianshi is a famous company from China that produces vitamins and dietary supplements.

Tian-De is a relatively young Russian company of cosmetics and hygiene products.

Vision is a well-known network company that produces high-quality vitamin complexes.

This is just a small list of MLM companies represented in our country today. We are sure that in a little time it will become even larger.

One of the relatively new, but already trusted MLM companies is 4Life Research. She gave us work, purpose and financial security. Transfer factor, which is developed and produced by this company today, is the only drug that is necessary for every person on our planet. Transfer factor is health, longevity and getting rid of most diseases known to science. We are proud to represent such a successful company and such a unique drug.

A 4Life distributor can easily achieve prosperity. Stable and timely payment of bonuses is provided at all levels and for absolutely any achievements. We reached a new level of orders, invited a new partner, expanded our network - for every step you take to new heights, the marketing plan provides a reward. Create your own profitable business no investment possible with 4LifeResearch. There are 2 ways to start cooperation with the company - Diamond or Leader. Each has its own advantages, and everyone who decides to cooperate can choose what suits them at this stage. The 4LifeResearch marketing plan includes travel incentives for distributors who demonstrate best results at the end of the year. These are the Great Escape+, Gold Getaway, and Platinum Pinnacle programs. There are many benefits to starting a business with a company. Each of the points of the Life Rewards marketing plan is a separate advantage. By joining our team, you will learn about all the advantages and can start making your dreams come true.

Working at 4Life Research means financial stability and independence, as well as deep feeling satisfaction from your activities. If you are interested, do not hesitate - register as a distributor on our website and become one of the thousands of people around the world who have made a choice in favor of life and health, success and economic well-being.

Good day, my dear readers! Many people interested in the network marketing industry are always concerned with one question at the very beginning: “Network marketing, what is it really? What is the job of a networker? I'll tell you about this right now.

From this article you will learn:

Three simple actions that a networker performs

Creation of a client base

But what does it mean to create a customer base? Doesn't this mean that we need to distribute some products? Unfortunately, most people have exactly this idea of network marketing: running around doorways with bags and trying to sell goods. Let's find out everything right now so that no one else can mislead us.

First difference. How does a real networker differ from a distributor? The distributor’s task is to find a client in any way and try to sell to him maximum quantity goods. The easiest way to find clients is by door-to-door. The algorithm is simple: sold the goods - received the money.

A networker does not have to physically sell a product or service to a client. A networker sells a person a new quality of life, which the client will achieve by purchasing a product or service of the company.

Second difference. Distributors primarily sell durable goods. For example, a vacuum cleaner. How often do you buy vacuum cleaners? Not often. What about electric kettles, frying pans, screwdrivers, etc.? We do not buy these products as often as, for example, cosmetics, vitamins or washing powder. Therefore, you will not see the person who sold you the product for a long time, and after a while you will forget about him. And if this seller doesn’t come to you anymore, why would he sell you high-quality and expensive goods? It is much more profitable to buy a cheap, low-quality product and sell it to you at a higher price, keeping the difference for yourself. But then he will have to look for a new client again. Network companies sell goods that tend to run out quickly so that customers repeat the turnover every month, for example, cosmetics, dietary supplements, cleaning detergents, and so on.

It is not profitable for a network marketing distributor to talk about low-quality products, because next month the client will refuse the low-quality product, so all network marketing products are of high quality.

If, of course, the company thinks about its future. Distributors do not have to look for new customers all the time, but it is enough to have 5-6 regular customers and not look for anyone else. Moreover, a distributor of a network company can use in his work an Internet site that will inform visitors 24 hours a day about new products and services of your company. This is called intellectual distribution. It is fundamentally different from the physical one that the distributor deals with.

The next, third, important difference is appearance . The distributor always walks around with large bags in which he carries goods for sale. The distributor works in business or simply neat clothes, with a briefcase or folder in which he carries documents, a history album, a catalog and other tools.

The distributor-networker looks elegant, he does not need to carry bags with goods at all.

So, we have found out the first task of a networker: with the help of his mentor, an information sponsor, to find his first clients and provide them with the latest information about the company’s products and services. Where and how to find your first clients? This is the least of the problems. Each network marketing company has several ways to quickly find 5-10 clients, including personal meetings and group meetings, as well as an Internet site that works for you 24 hours a day.

It is worth remembering that a new distributor never works alone. On initial stage he is helped by his mentor - an information sponsor. The sponsor simultaneously teaches the newcomer all the skills of doing business and holds first meetings with his acquaintances, showing him how to do it. He and his superior sponsors are interested in the success of the newcomer, so they are ready to reveal all their achievements and secrets.

Only in this business can you hear from a manager: “Dear colleague, how can I help you so that you become more successful in our business?” Therefore, a beginner is always supported and provided with all training materials, as well as effective tools for starting this business. It's very simple.

Creation of a distribution network

The main networker is a commission from the company. What does this mean? As usual, you tell your friends and acquaintances about new and high-quality products and services of the company. Someone you know begins to use the company’s services and buy its products.

Let's give a simple example. Imagine that the company pays you only $10 for each purchase, even if only five of your friends want to buy something for themselves from this company. This means your commission will be $50. A little. Now imagine that your friends will repeat you and tell five friends the same thing, and that’s already 25 people. In this case, your reward will be $250. Next, calculate for yourself how much you will earn every month if these 25 people each tell five more of their friends. The number of buyers will increase to 125 people, and your commission will be $1,250.

The good news is that no one limits you in the number of people you invite, and you can plan your income yourself. People will start using the company's services and products without your participation. Moreover, many of them will not even know you by sight.

This means that having done the job once, you will constantly receive your fee as a percentage of the total number of sales of all clients attracted to your distribution network.

To make your work easier, the company and its leaders organize special meetings and group presentations at which successful networkers will tell your friends about all the advantages of this business. Also, you have the opportunity to use special tools: for example, and many other tools. Now we have found out the second task of a networker: to build a network of distributors who will talk about your company’s services and products, and the company will reward them and you with cash payments. This means that you give people the opportunity to make money by doing what they always do: share with friends. new information and give recommendations. What's wrong with that?

Education

Own training and training of your newcomers. You will pass on the knowledge that you receive from your mentors to your newcomers. There is nothing simpler: your mentors, information sponsors, periodically conduct various seminars, schools, and trainings. This is where you will invite your newcomers. Today it is very convenient to teach beginners using the Internet. You just need to connect to the system and real mode time to learn from your mentors.

So, the third task of a networker is to learn and transfer this knowledge to your newcomers, because you and your sponsors are interested in the success of any new person. Network marketing is a team environment where everyone supports each other. Success in network marketing is achieved together.

Now you know what a networker does during his workday. But working in network marketing wouldn’t be so attractive if it only involved everyday work. You deserve much more than routine, banal work, so a whole reward system has been invented specifically to make the networker feel comfortable and enjoy his work.

This means that distributors receive recognition for their work. These include special gifts from a gold badge to an apartment or a car, these are insignia, this is promotion career ladder, this is a journey to different countries, as well as exclusive training from world leaders in this business. In short, the lifestyle of a networker can truly be called a dream, but do not forget that the company rewards conscientious distributors, those who really work. Everything is fair. Reward based on merit.

How long does this business take?

You and I have the right to say that we have little time, that we don’t even have time to do household chores, sometimes it seems to us that we don’t even have time to rest, we don’t have time to do this business. Of course, but if you and I continue to live like this, then time will definitely not increase. Think about it, all people have the same amount of time of day, yet all people achieve different levels of success. Some people can’t tie ends meet, while others manage to do a lot in less time. What's the secret?

This is the huge advantage of a network marketing business. It frees up your time: once you have created a working business system or, in other words, a network of regular customers or distributors, you receive royalties regardless of what present moment you are studying. This is where free time comes in, but for this to happen, you need to now set aside a couple of hours a day to start building your future.

Many successful networkers started this business, combining it with their work, devoting only a couple of hours a day to it. This is exactly the time we spend in front of the TV, but watching TV will not change your life for the better and will not feed your children.

So might it be better to use this time to create a business that will bring you income in the future, even when you are relaxing or doing what you love? Time is a resource that you can simply spend, and then it, like money, becomes less and less, but it can be wisely invested in creating a working business structure that brings you profit and gives you more free time, because the distribution network you created will grow and multiply and bring you increasing income. This, in turn, will allow you to choose for yourself what is worth devoting more of your time to.

How much money does it take to start a network marketing business?

Someone might say: “I don’t have any money for this at all.” Here you need to understand that starting any business requires money. Another question: “How much?” You and I are used to thinking that organizing a business requires substantial investments, and there are no guarantees that things will work out and that we will be able to get our money back. And this true statement, but not for network marketing. One of the advantages of working in network marketing is that you can start it with the money that you probably have.

You do not need to purchase expensive equipment, you do not need to hire staff and pay them salaries, you will not have production, packaging and transportation costs, you will not need to pay for the work of an accountant. The company will do all this for you, and, moreover, completely free of charge; you do not need to invest tens of thousands of dollars in organizing this business.

100-200 dollars is enough to get a turnkey business system + a set of goods or a company service for yourself and your family. For example, to start working with Avon you will not need any investment at all.

The benefit is that you cannot go bankrupt in this business. You will never lose the money invested, because already at the first stage, for your money you receive high-quality goods at a significant discount, which you can either sell and make a profit, or keep for yourself and use them as an ordinary privileged customer. You can no longer be called a deceived investor, but plus, you get your mentor and an entire business system that has already made many people in your company successful.

Therefore, there are only two outcomes of this matter, and both are beneficial for you: either your business will begin to develop and bring you increasing income, or you will receive an exclusive product or service of the company at a deep discount and become a privileged customer.

Let's look at this situation from the other side: if you are offered to buy new car Audi or Porsche for just a thousand dollars, provided that the money must be paid tomorrow, will you take advantage of this opportunity? Certainly! And a business worth 100-200 dollars will bring you much more than a new car. People who say they don't have money for this business simply failed to see this greatest opportunity in human history and this unique system that has made many people around the world successful and free.

When will I start receiving money and how much?

You need to understand that there are several sources of income in network marketing. We will tell you about two universal ones that are available in any network company that operates legally.

The first source is profit from customers who will not want to and will constantly purchase products from you without a discount. You may ask, “Why won’t they want to register? After all, it’s profitable!” Yes, but not everyone understands this. Moreover, the distributor buys products in small wholesale, for example, for $200, and the client may only need to spend $100 to provide himself with products for a month, and today he has no desire to spend more than this amount, although the benefits are obvious. If he spent $200, he would receive a significant discount. This means that there will always be people who will purchase the company’s products at one hundred percent of the cost. This will provide you with a small but fast cash flow. Some distributors earn between $400 and $2,000 per month using this source of income alone.
The second source is income from the turnover of the distribution network you have built. This source of income is the most attractive because it gives you the opportunity to earn passive income. The downside is that in the first months of your work you will not see much profit, but the upside is that by creating passive income for yourself, you will free up your time and will receive money no matter what you do. The network is built and lives its own life.

This way your business can become international, since many of your distributors have friends and relatives abroad, and you will be able to say: “I am in international business.” But be prepared for the fact that at first a small profit awaits you, but what more people will join your team, the faster your income will begin to multiply.

This can be depicted visually: the lake is completely overgrown with lilies in 30 days, every day one lily gives birth to another lily, and if today only a lily grew, tomorrow there will be two of them, the day after tomorrow - 4, then - 8. And here’s what’s interesting : on the 29th day, the lake will only be half overgrown, and in just one, 30th, day, another half of the lake will be overgrown. This is how the distribution network grows, which at the very beginning does not bring much results.

But there will come a time when doubling your network will bring you significant income. Imagine that you can invite just one person per month to this business and teach him to do the same, that is, invite just one person per month to this business. Let's calculate how many people will be in your network in 1 year. First month: you invite one of your friends, now there are two of you. Second month: you invite someone else, and your friend will do the same. Now there are four of you. Third month: all four will invite one at a time, and there will be eight of you. It is easy to calculate that in the fourth month your network will consist of 16 people, in the fifth month - of 32 people, in the sixth - of 64. At this moment, it may seem to us that the network is developing poorly and will not bring in a lot of money, but be patient, because in the seventh month there will already be 128 people in your network.

And this is only if you invite only one person per month. Even if we are lazy, and half of our network is also not active, your network will still consist of two thousand people, even if only half of them buy something, you will receive commissions from 1000 people, which is not bad money. Provided that you will receive $10 from each purchase, your monthly income will be $10,000, even if these people work twice as hard, your income will still be a decent amount. Agree, this is a good increase in your salary!

But I can hear a legitimate question from you: “I don’t have so many friends, where can I get so many people?” This is one of the advantages of a network marketing business. You only need to invite five people into this business, and they, in turn, will bring an entire army, repeating you. This way, your network can grow exponentially. Moreover, it is not necessary to build a network within your city. Having friends and relatives in other cities, your distributors will take this business beyond your place of residence, expanding its borders.

So, if you decide to get into this business, what lies ahead for you?

Your environment and personal growth. What does it mean? The fact is that your life largely depends on the people who surround you, and if you are always surrounded by poor or sick people, then most likely you will be the same. Working in network marketing, you will be surrounded by positive people who are determined to succeed, you will be trained successful people, which means that after some time you will become the same.

Working in network marketing provides you with unlimited passive income. This means that once you complete the job, you will receive income for the rest of your life.

This can be compared to running water. You can go to a well every day to fetch water, or you can, after spending 2-3 years, build a water supply system, and the water itself will flow into your home. You will only open the tap when necessary.
Recognition and journey. Every network marketing company rewards its distributors not only with money, but also with career opportunities. And the higher your status in the company, the more bonuses and gifts you will receive.

Many companies reward their distributors with new cars or apartments, as well as trips to exotic places on our planet.

One of the most attractive benefits of network marketing is freedom.. Freedom from bosses. You won't have a boss, but you will have a mentor interested in your success. Freedom of choice. You will choose who you work with, when and where. Freedom from the alarm clock. You don't have to wake up to an alarm clock at seven o'clock every day. You will plan your own work schedule. Freedom to choose your income. Now no one will be able to limit your income; you yourself will set any level that is comfortable for yourself.

Too good to be true? Yes, we have heard a lot of bad things about this industry, but think about whether a person who does not work in this business can give any advice, is it possible to judge what we do not understand and we can choose who to learn from? and who to listen to: the successful or the poor and sick. All this sounds good, but what are the pitfalls? After all, it can’t be that everything will be fine?

Yes, we must tell you about the disadvantages of this business and the main one is refusals. In ordinary life, we are not used to receiving refusals, but in this business, 8 out of 10 people will say: “No.” It's unpleasant, but you and I understand that these are the people who failed to see the greatest opportunity in this business. They say: "No!" not to you, they say: “No!” themselves, they deprive themselves of a good future, deprive themselves of travel and free life, they say to themselves: “No!” But two out of ten will say: “Yes!” They were able to see in this proposal all the advantages for themselves, for solving their problems. It is with these people that you will achieve success together, using network marketing as the greatest opportunity in the history of mankind, and then everything will be great in your life!

Irina Davydova

Reading time: 12 minutes

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The term “network marketing” involves the distribution of goods or services with the help of a well-developed and extensive network of distributors (note: independent representatives of a particular company).

Is SM (network marketing) a “pyramid”? , what are its pros/cons, and how does this system work?

How network marketing works - its pros and cons

What is the essence and how does network marketing work?

The point is simple: a person sells goods and invites other people to a similar position, from whose sales he receives interest. The more sellers he brings, the higher his earnings. Thus, a large network of sellers working for one organization is built.

The operating scheme of most network companies is usually the same (with minor differences in individual companies).

During the interview you are told about job prospects. and “huge” opportunities (usually the opportunities are overestimated or greatly exaggerated). For example, about a solid income in the first six months of work.
After registering, you may be asked to make a membership fee . It is worth noting that reputable network companies use exclusively legal schemes and do not require any contributions.
Next, you look for and recruit new sellers , which are already registered through you. This is the main feature of SM.
Profit (the difference between purchases and sales) comes to you after the sale of goods, which, as a rule, you have to buy with your own money. The profit also comes as a percentage of the sales of the people you recruit.

Network Marketing - Benefits

Saving money on advertising. The products of a network company are advertised mostly through word of mouth - direct contact between sellers and buyers. By saving on advertising, the market price of products is reduced and the distributor's income increases.
Purchasing effective and high-quality products , not available in regular stores.
Possibility of part-time or full-time work with a good income.
Free work schedule.
The amount of earnings depends directly on the time invested , human abilities and desire for high incomes.
Opportunity for your own business. True, not immediately, but after you recruit people, train them and promote them own system set. And, of course, it won’t be possible without investments. The only question is their size.
Help from professionals. As a rule, in every network company, along with the products, a person also receives a personal “guru” who helps, trains, and mentors him.
No age restrictions. It doesn’t matter whether you’ve just turned 18 or are retired—everyone can earn money.
No college diploma required . Instead, you will need qualities such as communication skills, ingenuity, etc.
Availability of a “promotion” system (career growth).
No need

Network marketing - disadvantages:

Instability of earnings. Especially at first, when the work will resemble a part-time job.
Material investments. It's inevitable. Even if they tell you the opposite, when accepting you into the ranks of the SM. The amount of investment will depend on the situation, company, product. Plus: the investment always pays off.
Selling products is not as easy as you initially think. Until you find your way to effective sales, you will experience a lot of negative emotions.
Not everyone will be successful. This point follows from the previous one. Much depends on your capabilities, abilities, experience, and learning ability. Someone will become successful, someone will leave this opportunity for a part-time job, and someone will leave altogether, muttering through clenched teeth: “You won’t earn anything here.”
You will work in the business, but you will not own it. Why? But because the products you sell do not belong to you. You will not be able to sell it as your own - for this you will have to develop your own product and open production.

Interesting job or financial pyramid?

Should you be afraid of working in a network company? What are the differences between SM and financial pyramids?

It is worth noting that SM has nothing in common with the notorious “pyramids”. The reputation of SM was considerably damaged, “thanks” to scammers who successfully disguised their companies as network ones.

How to distinguish a network company from a financial pyramid?

Signs of a “pyramid”:

The idea is to attract a large number of people to collect as much money as possible into the pyramid and disappear.
You make a profit for each person you invite who brings money to the pyramid.
The company's product (service) cannot be sold on the open market.
Consumers of products (services) are distributors only.
It won’t be possible without investing your own money. The size depends on the scale of the pyramid. Moreover, with your own money you are not buying a real and high-quality product, but dummies that, at best, simply do not cause harm. And in most cases, you give your hard-earned money for “membership fees” or some “papers” that have value exclusively within the pyramid.
Absence of any printed materials.
By investing money in a pyramid, you only receive promises that “very soon” you will become rich, rich.
In the pyramid they teach you to lie.

Signs of a legitimate network company:

The idea is to attract a large number of people to grow the company and increase the earnings of distributors.
You receive a percentage of the sales of people you invite to work.
The company's products can be freely sold on the open market.
Consumers of the products are ordinary buyers and distributors themselves.
Investment is only for goods that you buy and then sell.
Printed materials are usually present. At a minimum, product catalogs.
By investing in SM, you receive a quality product and interest on sales.
In SM they teach how to sell.

The most popular examples of businesses built using network marketing

The first of the first in SM were companies that appeared back in the 30s of the last century. They were engaged in nutritional supplements and sold only one product.

The most successful company in SM was the one that started in 1959 AMWAY. It was one of the first to go beyond the boundaries of selling the “1st product”, expanding the range of nutritional supplements with household goods.

What is network marketing: 6 advantages + 3 disadvantages + 5 myths + 10 tips for those who want to make money in an MLM company.

Network marketing or MLM. Who hasn't heard of him today?

Yes, it is perhaps difficult to find such a person.

And yet, most people who are not closely associated with this type of activity do not really know what is network marketing.

Some people overly demonize MLM, others, on the contrary, deify it and consider it almost the only one.

And some people simply don’t take it seriously because they associate network marketing with a friend who every month brings you to look through a colorful catalog and provides the opportunity to buy lipstick at a discount.

And what’s most interesting is that everyone is right, because they look at MLM from their own wheel.

What is network marketing as a type of business?

Network marketing (or MLM / MLM - multilevel marketing) is a special concept for the distribution of goods and services, based on the work of independent distributors, each of whom has the right not only to sell goods and services, but also to attract other distributors to the company.

Earnings depend not only on the quantity of goods and services sold, but also on how much the people you attracted to the company were able to sell.

Network marketing is a kind of pyramid, but unlike financial pyramids, this business is completely legal and can bring you good earnings, provided, of course, that you start cooperating with a serious company that produces high-quality goods and services at reasonable prices.

History of MLM

It was then that the owner of California Vitamins, a company selling vitamins and nutritional supplements, Carl Rehnborg, decided that the products he made would be sold not by professional sellers, but by consumers themselves.

Moreover, these same consumers will attract other buyers to cooperate, thus forming a network.

Thanks to this approach, within a few years the young company could boast a turnover of $7 million.

In the late 1930s, Karl Rehnborg renamed his company Nutrilite Products, but the principle of product distribution remains unchanged: it is sold by consumers themselves, armed with samples and manuals.

These same customers bring in other fans of Nutrilite Products nutritional supplements who want to not only consume them, but also sell them.

Rehnborg's business is growing by leaps and bounds and proves to all skeptics that network marketing has a right to life.

A new round of MLM development occurred at the end of the 1950s.

That's when two former employee Nutrilite Products De Vos and Van Andel decided that they were no worse than Rehnborg and founded the American Way Corporation, also working on the principle of network marketing.

It still operates successfully on the market today under the name AMWAY.

The heyday of network marketing occurred in the 1980s and early 1990s.

In the USA, with the help of MLM technologies, they distributed everything from household appliances to medicines.

Then they even said that soon the traditional type of trade, and the stores themselves, would disappear without a trace and network marketing would rule the world.

Today we see that these forecasts are far from reality.

Yes, MLM companies are still successfully operating in various markets, including in the former republics of the USSR, but they have not been able to displace traditional trading platforms.

According to the latest data, the turnover of large network companies (and today they number at least 4,000 thousand) is over 300 billion. US dollars.

How network marketing works

Since network marketing is a kind of pyramid, your earnings depend not so much on the number of your clients who purchase products, but on the income of the distributors you attract.

For each distributor you refer, you receive the specified percentage of income.

That is why in MLM companies those who are at the top of the pyramid and have the most widespread network of attracted distributors make good money.

Despite its cosmopolitanism, network marketing depends on the laws of the country in which the company opens a representative office.

For example, if we talk about Russia and Ukraine, network companies are prohibited from:

engage persons under 18 years of age as consultants;
promise specific wages, because there is no official employment contract concluded with distributors;
sell dangerous and unlicensed products, etc.

If you want to become a distributor of a network company, then doing so is quite simple:

You agree to negotiate cooperation with another distributor, or you independently go to the office of the company where you want to work.
Fill out the agreement form.
Get training (often this is just a conversation with an experienced consultant).
Purchase catalogs or product samples.
You begin to sell goods and services to customers and attract new distributors to cooperate.

Remember that if you come to work for an MLM company, you will become a freelancer who is not covered by social guarantees, sick leave, or vacation pay.

Even after many years of work, you cannot count on a pension from the state because you did not pay Social Security contributions, etc.

In addition, you have no guarantee that after some time the MLM company with which you for a long time cooperated, will not close its representative office in your country and you will not be left without work.

Network Marketing - Pros and Cons

If we consider network marketing as a way to make money, then it is worth knowing not only about its advantages, but also remembering the disadvantages.

This will help you make an informed decision when you decide to make MLM your main profession.

This information will not be superfluous for those who consider network marketing as an official salary.

Pros of Network Marketing

The main advantages of network marketing for those who seriously engage in it include:

Opportunity to learn.

If we are talking about serious network companies, then they, caring about both the reputation of their corporation and the size own earnings Therefore, they constantly raise the qualification level of their employees.

Seminars, courses, meetings with mentors, etc. are organized for them.

Sometimes training is carried out at the expense of the students themselves, but there are also pleasant exceptions to the rules.

Free schedule.

You don’t have to sit in the office at the time determined by your boss, because the boss is you.

You can devote 3 or 10 hours a day to work.

It all depends on its effectiveness: if you have made a profitable trade, you can reward yourself with rest, but there are also bad days when you have to work for a long time, but, alas, to no avail.

In any case, you create your own work schedule.

Unlimited earnings.

Ideally, this is true: no one sets a maximum income limit for you.

If you are a clever, creative person, capable of an unconventional approach to winning a client and ready to work hard, then your earnings will be quite decent and will begin to grow as your qualifications improve.

Financial independence.

By starting to engage in network marketing, you actually acquire a network that you can strengthen and expand.

If you sell high-quality products and fulfill all your obligations to customers, then your customer base will grow, and accordingly your profit will increase.

Moreover, the amount of earnings will not depend on the whim of the boss, but solely on you.

Close-knit team.

Those who have at least once worked in an MLM company can confirm how easy it is to start working here: no behind-the-scenes games for you, no rejection of a newcomer and no set-ups from the old guys.

More experienced employees will always help you, because the level of your earnings affects their income and status in the company.

Interesting work.

Of course, if you have what it takes to get involved in network marketing, you will find interesting and creative work.

MLM is not a tedious sitting in the office; you don’t have to imitate activities in order to survive until the evening. You definitely won't be bored.

Cons of Network Marketing

Network marketing also has some disadvantages, although quantitatively they do not reach the advantages:

Unstable income.

If you work in an organization with a specific salary, then you know for sure that at the end of the month you will receive the exact amount of money.

In network marketing, a completely different situation is observed: successful periods can be replaced by lack of money.

To earn a stable income, you need to have a large client base and constantly expand it.

Material investments.

When inviting you into network marketing, they will convince you that this is a business without investment.

In reality, this is not true, because with your own money you will have to buy product catalogs, as well as testers to demonstrate to the client.

Some MLM companies require their distributors to wear corporate colors or wear some elements of the uniform - this will also have to be purchased at their own expense.

Emotional stress.

You know as well as I do how people treat product distributors: at best, as annoying flies that need to be gotten rid of as quickly as possible, at worst, as swindlers who are trying to sell some kind of crap.

You need to be prepared for this and treat people’s reactions philosophically.

Also, come to terms with the fact that you will get very tired from constantly communicating with people.

You should also remember that network marketing is not a business for everyone.

If you find it difficult to leave your comfort zone, talk to strangers, if you are tongue-tied, do not have the gift of persuasion, and in general communication is not your strong point, if you are ready to give up at the first failure, then you are better off doing something else.

You are unlikely to have a long-term relationship with MLM.

Network marketing is an opportunity to make money, but not for everyone

I am not a supporter of demonizing network marketing, but I know that I definitely would not make money in this way.

But among my friends there are those who work in MLM companies.

Some take their work more seriously and, in general, make good money, others use network marketing as an opportunity to purchase cosmetics at a discount, which they themselves use.

But I don’t know any sad stories when swindlers, under the guise of network marketing, defrauded gullible people who wanted to become distributors, although on the Internet similar stories complete.

Common Myths Surrounding Network Marketing

I know that network marketing is surrounded by various myths.

I chose the 5 most common ones and asked my friend Alexander to confirm or refute them.

Alexander has been collaborating with AMWAY for a long time.

He started working in network marketing more than 10 years ago, when it was still possible to form his own network.

Despite the fact that most distributors’ earnings depend on the number of sellers attracted, Sasha took a different path and began to earn money from sales of, in general, good goods.

My friend’s main source of attracting new clients is, or rather, social networks.

He claims that even in the worst months he earns at least $70.

Considering that he has a main job, then such a source of additional income is quite good.

Network Marketing Myths:

You can earn a lot of money here.

“It may be so,” says Sasha, “but I haven’t met people who.”

To get rich in an MLM company, you need to be at its origins.

This is not a serious job for students.

If you are going to treat network marketing like that, then you have no business being in this business.

This is serious work that requires a lot of dedication.

It’s horror, not work, to run around with bags of goods and pester people.

You will really have to “pester” people, because without a conversation you will not be able to sell the product or attract a distributor.

But it’s not necessary to walk around apartments with bags; now there are plenty of other ways to attract clients and sellers.

There are only scammers in network marketing.

To avoid becoming a victim of scammers, do not get involved with frivolous companies that you know nothing about or those that have bad reviews.

Serious players do not deceive their clients.

You can't earn anything in MLM.

It’s possible, and I proved it to you using Sasha’s example.

I think that my friend would earn much more if he did not have a main job, but devoted all his time to network marketing.

Usually, myths that you won’t earn anything in MLM are spread by those who have not had success with this business.

But just because someone has failed doesn't mean you will too.

How distributors can communicate with people who are inclined to believe

The expert from this video will tell you the above myths:

How to make money in network marketing?

Despite the fact that there are many myths and misconceptions floating around network marketing, you can make money with this type of activity, and you can do it quite well.

If you feel the strength to do such work, if you know that you are ideally suited for this business, start acting.

10 useful tips for those who want to make money doing network marketing:

Start working in a well-promoted serious company that will not require you to invest in the business. a large sum: “Oriflame”, “Amway”, “Mary Kay”, “Ivon”, etc.
Here you will not be able to earn huge money at first, but you will learn the basics of business.
Strive for development: attend all kinds of trainings, read a lot, adopt the experience of senior colleagues, etc.
Thoroughly research the product you are selling so you can answer any customer questions.
Build your own network, don't just try to sell more goods.
Use various methods of promoting a product: through personal communication, via the Internet, using advertisements in free newspapers, etc.
Do not lie to the client, trying to sell as many goods and services as possible.
If you distribute high-quality products, then you won’t have to lie.
Look neat, speak competently and beautifully.
Don't be pushy if you feel the customer isn't interested in what you're offering—it angers, not encourages.
Be prepared to work for virtually nothing at first, so don't rush to quit your day job until network marketing starts making really good money.
Don't give up in the face of failure.
If one of your friends did not succeed in making money in network marketing, this does not mean that you will not succeed either.

Knowing what is network marketing, you can always do an interesting and profitable business that does not require special education.

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