This unique business has millions of distributors doing billions of pounds in sales annually. It is conducted in nearly 100 countries around the world. It has been praised by leading business people and also by heads of state for boosting the economy. Yet most people in the UK are still totally confused by it.
Network marketing has created many millionaires and spread that exception to millions more, but just what are the realities of this business?
So what is network marketing?
Network Marketing is based on the concept of 'networking'. We all have a circle of people we know through the circumstances of our daily lives and each of these people will have their own circle of acquaints, collections, family and friends. Network Marketing involves tapping into these networks not only to sell product but also to offer the business opportunity to potential new distributors who then start the process of developing their own networks for selling and recruiting.
In network marketing, services and products are distributed to the final consumers through a network of independently contracted distributors or agents (also known as consultants). These distributors are then financially rewarded in two ways: a) from responsibilities and overrides from sales generation and b) for their contribution to the building up of the network by getting new 'enrolls' to be downline distributors. The network marketing business model works because of the price differential that is generated from the distributor to the consumer. If the enrollments of the one you recruited generate sales, you get a percentage of the price differential for the sales, and so on.
Network marketing is usually associated with pyramid or ponzi scams. This is because the main structure of the two models can be quite similar at first glance. However, if one takes a closer look at the models, there is one big and defining difference between them. The main difference between legal network marketing firm and a pyramid scam is that the first one offers real products and services, the latter only promises opportunities and generates money from the cost of entry of the registered members. A pyramid scam re-channels the incoming funds from the fees that newly registered 'members' pays for entering the scheme and does not generate any kind of profits from other endeavors. The masterminds of the scam benefits while leaving most, if not all, of the downlines in financial burdens.
o As the networks widen, so the individual leader benefits not only from their own sales but also a percentage of the sales from their network. As more people join the network, so residual income increases.
o network marketing allows its distributors not only to network outwards in order to sell the product but also to benefit from their downline's downline, either to a limited depth or ad infinitum. However, the two terms tend to be used fairly indiscriminately.
o As with any other home-based business, distributors need to work hard and have courage and determination. Finding a good sponsor is just as important as finding an interesting product and a good compensation plan which offers flexibility and just reward for effort. Contrary to expectation, the newcomer has the same potential for success as the long-term sponsor provided that the necessary research and skills training takes place. It is not necessary to be 'in the beginning' and in some cases it may prove more difficult and risky to join at the beginning than to join a plan which has reached a more mature phase. Network Marketing is specifically suited to married women with family commitments as it offers them an opportunity to start a business on a part time basis with very little capital. The opportunity now exists for entrepreneurship women to use their talents and the skills gained from motherhood to build businesses based both on selling and on finding and supporting the efforts of others.
There are 2 trends that are driving this industry forward:
a. General shift towards self-employment.
b. People's quest for a better lifestyle - They no longer want to work 40 or 50 hours a week just to pay bills.
For many people Network Marketing is the only way to Create Financial Freedom in the UK today.
One business magazine wrote "Network marketing is so far ahead of the competition when it comes to money and lifestyle that is in a league of its own."
With a traditional career you only get paid for the hours that you work. When you leave your employment monthly salary stops and all you are left with is experience and sometimes a pension, which is rarely enough to live on. Network marketing is entirely different - Your efforts are multiplied by helping people succeed with their businesses, so that your investment comes back many times over, to create time and financial freedom. The longer you work at it, the easier it becomes. The more you help others become successful, the more successful you become.
"Network marketing offers people an opportunity to build a business of their own, with a small amount of capital, in their own time and with the help of a sponsor who is willing to help them every step of the way". Prime Time Magazine
As you leverage your efforts you create a 'residual income' - by helping enough people become successful. Over time, you can build a truly passive income that keeps paying you long after you have done the work.
Network marketing offers people an opportunity to build a business of their own, with a small amount of capital, in their own time and with the help of a sponsor who is willing to help them every step of the way. "Prime Time Magazine
As you leverage your efforts you create a 'residual income' - by helping enough people become successful. Over time, you can build a truly passive income that keeps paying you long after you have done the work.
Consider this-
According to a study conducted in the USA in 1995, 'Out of 100 people who are working at age 25, by the age of 65 ...
o 63% are dependent on Social Security, friends or relatives
o 29% are dead
o 3% are still working
o 4% have adequate capital for retirement
o 1% are wealthy
Questions typically asked about Network Marketing.
Q.Can Network Marketing be done successfully part-time?
A. Absolutely ... it's very common in fact. You can start your Network Marketing business on a part-time basis without giving up your current source of income until your Network Marketing business is generating the income you require. And the best part is that you can continue to operate indefinitely on a part-time basis. What would you do if you were financially independent and most of your time was free to do with as you pleased? This is why so many people are flocking to Network Marketing. And that's why we say that Network Marketing puts the freedom back in free enterprise!
Q. Do I have to sell products door-to-door or hold parties or meetings?
A. No. One of the greatest features of Network Marketing is that success can be achieved using a wide variety of methods. You choose the methods that YOU are comfortable with. Within Tiscali we use amazing internet technologies. No delivering products, no collecting money, no party plan meetings!
Q. Is not Network Marketing one of those pyramid schemes?
A. Definitely not. Although Network Marketing and pyramid schemes do share some similarities, there's a very important difference that makes the latter illegal.You see, in pyramid schemes, income is generated solely on the process of recruiting others into the pyramid. Sometimes a product or service of questionable value is involved (that is never retailed to the general public by the way), but generally what you're buying is the right to recruit others into the scheme. This is illegal. Also, in pyramid schemes, those who get in first and who are at the top win, while everyone else loses. In a legitimate Network Marketing company, on the other hand, distributors are paid only on product movement; not on recruiting. Both at wholesale and retail. There's also compensation based on the training and management of your marketing team. And unlike illegal pyramids, in Network Marketing, no matter where you're positioned or when you join, you can advance to the very highest income levels and even make more money than those above you in the network.
Q. I'm not a salesperson, so this probably is not for me.
A. Actually, studies have shown that people with no sales experience do great in Network Marketing. In fact, the studies show that they often do better than those with previous sales experience. This is because Network Marketing is not about selling; at least not in the way most people think of selling. There's no place for arm-twisting or high-pressure techniques in Network Marketing. Rather, Network Marketing is simply about sharing the concepts and products of your Network Marketing company that you use and you're excited about.
Q. How much money can I make?
A. The bottom line is you'll get out of it what you put into it. It works ... if you do. But that's the beauty of it, too; you are in control; it's up to you how far you take it. And do not forget, the income you create in Network Marketing is residual. This basically means that for the work you do just today, you have the potential to earn money not only for today but for years to come.
Q. What's so important about sponsoring in this business anyway?
A. It's like this ... it does not matter how intelligent, rich, energetic, or dynamic you are; we are all limited to the same 24 hours a day. By sponsoring, however, you can overcome this limitation. By sponsoring, you can essentially clone yourself and have dozens, hundreds, even thousands of people all working indirectly on your behalf on their time and receive a cut of everything they do. Sponsoring also builds your security in this business. Why? In most traditional businesses, what happens if you become ill or disabled and are unable to service your customers? Or otherwise you just want to take a nice long vacation? Whatever the case, you could lose most if not all of your income overnight because it relies on you being there. That's not owning your own life and that's certainly not financial freedom.Through the process of sponsoring and building a downline in Network Marketing, however, you can create total financial freedom for yourself. With a downline of independent business people working for you, you no longer have all your eggs in one basket. On the contrary, because each person in your downline has a vested interest in continuing and building their own businesses, you create an income that is non-dependent upon you - an income that can continue, even grow, indefinitely with or WITHOUT you.
Q. Do I have to stock and deliver products?
A. Most Network Marketing companies today allow its distributors (and often even retail customers) to order direct from the company. The company simultaneously tracks your bills, credits your account, and automatically sends you a check for the total amount due.
Q. Is not Network Marketing just another "get-rich-quick" scheme?
A. No, "get-rich-quick" is a fairy tale. It just does not happen in the real world. Sure, there are a few exceptions, but they're extremely rare. In fact, if overnight riches is your dream, your odds are probably better playing your state lottery than doing it in business - any business.
Q. I could not get involved in Network Marketing. It's not a "real" business.
A. It's very real. Network Marketing is now a multi-billion dollar industry involving millions of independent business people and major US corporations like Colgate-Palmolive, Gillette, Sprint, and MCI, just to name a few. And it's a rapidly-growing international force, too, with thousands of Network Marketing companies already in operation in Canada, Mexico, Europe, Japan, Australia, New Zealand, and the Pacific Basin.
Q. If Network Marketing is so great, why are not more people involved?
A. That can be summed up in one word: misconceptions. The general public just does not understand what Network Marketing is or its potential. But that's finally starting to change. Right now it's estimated that only about 2% of the US population is involved in Network Marketing. But industry experts predict that number number could climb to 10% by the end of this decade. You can position yourself to take advantage of this trend by getting started in Network Marketing now. The timing is great for getting involved!
Q. What are the costs involved in starting and operating this kind of business?
A. Virtually all Network Marketing companies require you to first purchase some kind of "Starter Kit." This is a one-time cost, and is usually less than $ 100. In addition, of course, you'll have monthly expenses for office supplies, postage, advertising, etc. A total of £ 50- £ 150 pounds per month is probably a realistic expenditure to expect. Anyone can afford this amount of money without jeopardizing their current lifestyle while they're trying to build a better one. And here's some more good news - most, if not all of that, is tax deductible.
Q. What if I can not afford to buy extra products.
A. You're not supposed to. Network Marketing companies just want you to replace those products you now buy elsewhere with the equivalent-but-higher-quality products your Network Marketing company manufactures. By doing so, you'll likely save money since you now get to buy at wholesale. Plus, it only makes sense to buy from yourself - to buy from "your own store."
Q. I've tried Network Marketing before and it did not work for me.
A. Let's say you've just moved into a new city and you decided to go out to eat that evening. Unfortunately, the food at the restaurant you picked turned out to be horrible. But just because of this one bad experience, you certainly would not swear off eating at all the other restaurants in the city, would you? Of course not! Network Marketing is no different. There are fair Network Marketing companies, great Network Marketing companies, and, yes, even some bad Network Marketing companies. But Network Marketing works! You just need to link up with the right company and the right opportunity at the right time. See MLM RockStars.
Q. I do not have the cash right now to get involved in Network Marketing.
A. Get it! If a brand new £ 60,000 Mercedes were offered to you for £ 1000, would you find the money somehow to buy it? Go and get the money because your own Network Marketing business could be worth a lot more than that Mercedes.
Q. I can see how others have become successful, but I do not think I could do it.
A. People of every age, every background, from every walk of life are making it in Network Marketing today. If you have the desire, you can succeed in Network Marketing.
Q. If I would happen to be sponsored by someone half way across the country, how do I get questions answered? And what about training?
A. Free consultation and assistance from your sponsor, other upline associates (and often the corporate staff of your Network Marketing company) is a phone call away.Faxes, E-Mail, Voice Mail, and other new technologies also provide fast and efficient communications between upline and downline ... no matter where they're located. As for long-distance training, this is easily handled through video training CD's, audio taped seminars, books, online computer and telephone conferences, etc.
Q. I just do not have the time to start a Network Marketing business. I've got too many irons in the fire already.
A. That's precisely why you should consider Network Marketing. Beside creating financial freedom, Network Marketing is specifically designed to create personal freedom for you so that you can do all the things in life you really want to do that you do not have the time for now.
Q. Do not you have to get in at the beginning to make any real money? Does not saturation ever occurrence?
A. That's another big misconception that's been perpetuated by the media for years. The fact is, there has never been any evidence produced that "saturation" occurs in Network Marketing. This very topic was debated in US courts at one time and that was the conclusion by the courts.Secondly, realize that because Network Marketing is still a very young industry, there are hundreds of millions of prospects worldwide who have never even heard of Network Marketing . It will take years to even make a dent in that.But here's the main reason why "saturation" is a myth: Timing. In the US alone, there are tens of thousands of brand new prospects "hatched" every year.Part of that figure is young adults who have only just reached the stage in their lives where they'd consider (and could afford) to start a business. Then there are the thousands who have just experienced a major shift in the direction of their lives because of changes at work, at home, etc. These same people, who just months before could in no way, shape, or form be considered prospects for Network Marketing, are now suddenly very open to the proposal. And this is happening constantly. Bottom line: The market is wide open and the potential is powerful.
Finally, Internally acclaimed business people agree that Network Marketing represents one of the greatest opportunities in the world today.